First-time house buyers consider alternative finance options
ALMOST half of first-time property buyers in the UK are considering using alternative finance to help raise a deposit, according to new research.
The research conducted by high street bank Santander found that more than 40 per cent of first-time buyers are increasingly turning to methods including crowdfunding, selling raffle tickets, shares and bonds.
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Of these, 22 per cent of first-time buyers are considering selling shares in the property offering a potential capital return when the home is sold.
A further 19 per cent are planning to embrace crowdfunding to raise their deposit, while nine per cent are planning on selling a bond to investors offering a guaranteed interest payment.
And eight per cent would explore selling raffle tickets for an equity share in the property after the deposit total is reached.
“We know that getting a foot on the housing ladder is tough and our research suggests first-time buyers are taking some quite serious measures to make that first step,” said Miguel Sard, managing director of mortgages at Santander UK.
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“They are showing incredible levels of resilience, determination and ingenuity to save for a deposit and exploring all available options to maximise their savings.
“It is important that those considering alternative finance routes to raise funds read up on all the relevant regulations to avoid potential prosecution or huge legal fees.”
Santander also found that 38 per cent of first-time buyers opt to move back in with their parent for two years to save for a deposit while almost two million would give up healthy food.
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