First-time buyers need £31k deposit

The typical deposit needed by first-time buyers to secure a property has almost trebled in the last three years and now tops £31,000, according to the Council of Mortgage Lenders (CML).

An average deposit stood at £12,700 at the start of 2007, but rose to £31,500 by the second half of 2010.

The CML was speaking at an emergency housing summit yesterday designed to provide the first step towards solving the first-time buyer funding crisis.

Called by Housing Minister Grant Shapps (pictured), the summit was attended by a range of industry representatives, including people from the Building Societies Association, the Home Builders Federation, housing charity Shelter, the Financial Services Authority and local councils.

Michael Coogan, director general of the CML, said that while mortgage insurance, shared ownership and product innovation could all potentially play a part in improving the mortgage market, there was no "magic bullet" that would normalise it.

Shapps called the summit in order to have a "frank and open discussion" about the issues facing first-time buyers, and to consider ways they could be helped.

The Government estimates that there are currently 1.4 million households who want to own their own home, but are unable to do so because of house prices and the lack of mortgage availability.