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'I waste £9 a day on car parking': why first-time buyers moving back home still struggle to save a deposit

Olivia Farrell
Olivia Farrell has had to move back in with her parents Credit: Andrew Crowley

It may seem like the ideal way to save for a deposit, but would-be first-time buyers still face a battle to raise cash, even after moving back in with their parents.

A generation of young people are reliant on the Bank of Mum and Dad to help fund their housing dreams, and some are also depending on parents to provide them with accommodation while they save.

Research by Trussle, an online mortgage broker, shows that almost half of parents (48pc) would let their children return to the family home while they save for a house, with 23pc allowing them to do so rent free.

Yet even this may not be enough as the cost of living at home can quickly add up.

Olivia Farrell, a 25-year-old who works in marketing, moved out of her flatshare in London to return to her parents’ home in Beaconsfield, Buckinghamshire as high rents meant she was unable to save for her first home.

“The main reason for moving back was to try and save some money,” she said. “It is impossible to save in London. Pretty much all of my wage was going on rent and bills. I was having to push for promotions and pay rises just to get by.”

Miss Farrell said she was spending £750 per month on rent in the capital and a further £100 on household bills, plus the cost of travel and other living expenses.

But while some of her outgoings have been reduced since she returned home, others have increased substantially. This means she is not able to save as much as expected. 

Miss Farrell now spends an extra £400 a month on a train season ticket to commute to London from Buckinghamshire, plus £9 each day to park near her local station. In addition to these financial costs, her commute has increased from 30 minutes to 2-and-a-half hours.

“When I moved home I thought I’d save loads of money but now I need to pay for a car park, train and tube fares, plus for the cost of living,” she said.

The move home has also had a detrimental impact on other aspects of her life.

“To come back to the family home is stressful. You’re living back under someone else’s roof and you lose your freedom. I feel like I'm missing out on the social element of life,” Miss Farrell said.

“If I go for dinner after work I can only stay for an hour because I need to think about going home and going to bed."

Olivia Farrell was spending £750 per month on rent in London, she now lives with her parents Credit: Andrew Crowley

She expects she will still have to rely on parents to help her raise a big enough deposit to buy a house. But will living with parents have a detrimental impact on her mortgage chances?

Dilpreet Bhagrath of Trussle said that some banks look at rental payments as proof that a customer would be able to afford the monthly mortgage repayments. This can be an issue for those who have been living at home as they will have no track record. Miss Bhagrath suggested that first-timers take other steps to improve their credit rating.

“Lenders will also look at other financial commitments including loans and credit cards – so it’s still possible to build up a good credit rating by staying on top of those payments while living at home rent free,” she said.

But she warned that first-time buyers, who are likely to have a small deposit, will be typically be offered mortgages with higher rates than other customers, as banks judge these customers as riskier.

Miss Bhagrath said it may be more beneficial to choose a two-year fixed deal initially, which will allow the buyer to build up equity in their property, before switching to a more competitive deal in a couple of years’ time.

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Are you a first-time buyer living at home and still struggling to save a deposit? What are the biggest problems that you face? Do you have any tips on how to save as much as possible? Tell us in the comments section below.