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Daily Mail
27-05-2025
- Business
- Daily Mail
How long will it take me to save a £30,000 home deposit?
I want to buy my first home and have worked out that I need to save a deposit of about £30,000. I am starting from scratch and could save about £300 per month, how long would it take me to save the deposit? This information is for educational purposes only and does not constitute financial advice. Plum does not provide financial or any other form of advice. Plum replies: Getting onto the property ladder has arguably never seemed more challenging. Higher interest rates, rising house prices, lower housing supply and stricter lending criteria have combined to make things tough. It would take approaching nine years of saving the entire average annual household disposable income in England, of £35,000, to afford the average-priced home, worth £298,000 last year, according to the ONS. However, there are some positive signs emerging for potential homebuyers. The Bank of England's base rate is falling and is expected to come down by more than economists forecast at the start of the year, so borrowing costs should get lower over the months ahead. Meanwhile, earnings have been growing in real terms for approaching two years – meaning that on average wages are rising faster than inflation House price growth is also showing signs of slowing down, especially after the latest stamp duty holiday ended in April, while many major lenders are loosening lending criteria. All this means that buying a home could become a little easier. How to save a home deposit First though, you need to save a home deposit. Typically, first-time buyers need to save between 10 per cent to 20 per cent, with the remainder of the cost financed by their mortgage. If we take a typical house purchase price of £300,000, that means you'd need to set aside between £30,000 and £60,000. While that can seem very steep when beginning from £0, the key is to start early. Even small contributions can build up quicker than you thought, thanks to the power of compounding, which means earning interest on already-earned interest, or investment gains on top of existing gains. Apps like Plum can make it easier for you to set money through automation. The app connects to your bank account and works out how much you can afford based on your incomings and outgoings. A lot of Plum customers have found that they've ended up with more savings than they thought possible. It's also a good idea to take advantage of opportunities to boost your savings, if you can. The Lifetime Isa scheme is designed to help first-time buyers and can amplify the returns from savings to help you secure your first home. That's because you get a 25 per cent bonus from the Government up to a maximum of £1,000 each tax year, as you can save up to a maximum of £4,000 annually. Remember that Lifetime Isa terms apply and you should make sure a Lifetime Isa is the right choice for you, before opening and saving into one. Anyone aged between 18 and 39 years old can open a Lifetime Isa. And the money you make from putting your money to work in a Lifetime Isa is tax-free. That's as long as you stick to the Government's rules about when you can withdraw your money and for what reason - you must use the money to help you buy your first home or for retirement, unless it's an exceptional circumstance. If you don't stick to the Government's rules, you'll have a 25 per cent withdrawal penalty so you may end up with less money than you deposited initially. For savings over and above the Lifetime Isa limit, it pays to make sure that tax doesn't eat into your returns. This means using the tax shelter of a cash Isa or stocks and shares Isa is wise. You have an annual Isa allowance of £20,000 per tax year, which includes the £4,000 that can go into a Lifetime Isa, so that means you could also protect other savings you might have from tax as well. > Learn more about Plum's Lifetime Isa How long would it take to save a £30,000 deposit Here is an example from Plum to show you the power of compound interest combined with the Government bonus if you put your money in a Lifetime Isa. If you saved £333 a month for five years with an interest rate of 3 per cent, your savings would grow to approximately £26,418. That's a return of over 32 per cent, having deposited just under £20,000. Should you use a cash or stocks and shares Lifetime Isa? A big question is whether to put the money to work through a Cash Lifetime Isa or a stocks and shares Lifetime Isa, so you can get a potentially bigger return on top of the 25 per cent Government bonus. This very much depends on your attitude to risk and when you need to access your money to buy your first home. With a cash Lifetime Isa, your money isn't at risk as long as your deposits are FSCS protected, and you know the interest you'll be earning. The amount of money in a cash Lifetime Isa can't go down, so there's no risk of you ending up with less money than you put in, unless you don't follow the Government's restrictions. But your return will be limited by the interest rate you can get on the cash Lifetime Isa. With a stocks and shares Lifetime Isa, you have no ceiling on your potential returns, as they will depend on investing in the stock market, where gains have no cap. But there is a risk that markets could stagnate or fall instead of rise and your money might not grow, or may even fall in value, and you could get back less than you put in. It's typically recommended that you only put funds in stocks and shares if you plan to keep money invested for the long-term, which is at least five years, to help smooth out any fluctuations in your investments. When building a pot of money for something as important as your new home, you'll need to go in with eyes open if you decide to go for the investments rather than cash but of course, you may get those larger returns. If you do invest, you may want to reduce your exposure to the market the closer you get to reaching the deposit you need, which could mean moving more of the money into cash. To help you plan for how long it will take you to save for a house deposit, Plum has launched a Lifetime Isa calculator. All you need to do is type in details about your savings, where you want to buy and the type of property you want. This calculator provides illustrative projections only and does not constitute personal advice or a recommendation. This content is for general information only and does not constitute financial, investment or tax advice. Plum does not offer regulated financial advice. Investments can go up and down in value, and you may get back less than you invest. Eligibility for Lifetime ISAs and the availability of government bonuses are subject to HMRC rules. Tax treatment depends on individual circumstances and may change. Please consider speaking to a qualified financial adviser before making financial decisions. Plum is the trading name of Plum Fintech Limited and Saveable Limited. Plum Fintech Limited is registered and regulated by the Financial Conduct Authority (FRN 836158). Saveable Limited is authorised and regulated by the FCA (FRN: 739214)
Telegraph
24-05-2025
- Business
- Telegraph
‘How can I help one of my grandchildren buy a house without making the others jealous?'
Dear Sam, I want to help my granddaughter buy a house. She is in the police force, and is currently living in subsidised shared accommodation because it is too far for her to commute from home. My financial adviser told me that I can afford to be generous with my family over the remainder of my life without running out of money. I even have a significant 'just in case' pot which would pay for care at home if I preferred that to selling the house and going residential. I feel very well provided for. My granddaughter has found a place in Kent that makes the commute tolerable. If she can get a 20pc deposit organised, she can raise a mortgage for the rest. She has saved some, but needs another £25,000 to be sure she can cover the deposit and costs of buying her first home. I can easily afford to give her this, but I do have two other grandchildren. They are younger, and not ready for homeownership. I have two dilemmas. Firstly, is there a way I can treat them all equally? I don't know when the other two will buy homes, but the prices will be different, so I will probably need to give them more to achieve the same result. The second dilemma is that I would want them to use the money to become homeowners. I am a strong believer in getting on the property ladder and securing their housing position, but I don't want them to end up with boyfriend/girlfriend who benefits from my money if they buy something together and then have a bust up. How can I make sure I can help them all, encourage them to buy homes and ensure what I give my grandchildren can't be claimed by anyone else? – Margaret Dear Margaret, I know your financial adviser, which is how you were encouraged to write in with your dilemma – and it doesn't surprise me that because of good planning and well-managed personal finances, you find you have the means, and the heart, to support your family in a deeply meaningful way. Your granddaughter's determination, joining the police force and saving diligently, is also admirable. It's no wonder you feel moved to help her take that next step on to the property ladder. Your instincts are generous and wise, but I can see why you're feeling torn. The first of your concerns – fairness – is one many grandparents share. You want to help now, but without disadvantaging your other grandchildren later. The truth is, equality doesn't always mean sameness. Property prices will change, your grandchildren's lives will unfold at different paces, and needs will vary. Rather than trying to make identical gifts at different moments in time, it might help to shift focus toward the principle of 'equitable intention', offering similar opportunities to each grandchild, even if the financial outlay isn't exactly equal. To manage this, you could keep a simple record of gifts made, clearly noting the purpose and value. If you give £25,000 now to your eldest granddaughter, record it as such with the understanding that, when the time is right, the younger grandchildren will receive a comparable leg-up, whether for property, education, or another major life goal. If circumstances change, you'll still have the flexibility to adjust accordingly. Keeping a note like this in your will or letter of wishes (which is not legally binding, but can guide your executors) helps communicate your values and intentions without tying your hands or forcing premature decisions. The second dilemma – protecting the gift from partners or relationship breakdowns – is trickier, but it can be approached sensibly. If you were to gift the money outright and your granddaughter buys jointly with a partner, that partner could acquire a beneficial interest in the property, especially if they contribute financially or live there long-term. If the relationship were to end, your gifted money could be caught up in a dispute or division. One way to reduce the risk of this outcome is to give the money on the understanding that it will be documented as a loan, even if it is never repaid. A formal declaration of trust or a loan agreement can establish your granddaughter as the sole legal owner of the money, protecting it in the event of a relationship breakdown. This approach gives her full use of the money but creates a legal separation from her partner's financial rights. It also preserves some flexibility, allowing you to later forgive the loan if the circumstances still feel right, for example, once she's married or well-established. However, there's a trade-off here that your financial adviser may already have highlighted. From an inheritance tax perspective, gifts rather than loans, begin the clock on the seven-year rule. Provided you survive for seven years after making the gift, the amount falls outside your estate for tax purposes. Loans, by contrast, remain assets on your balance sheet and are counted in full, even if they are never repaid. So, if reducing a future inheritance tax bill is one of your objectives, a straightforward gift may be the more efficient route. Just be sure to keep good records and be open with your adviser about your intentions. As advisers we can be inclined to overweight the tax outcome in a decision-making process – forgive us. Some grandparents prefer to buy a stake in the property as a way of protecting their contribution, but you've indicated that this doesn't appeal. That's entirely understandable. Another alternative is to place the money in a trust, but this can be complex and costly to manage, and is rarely necessary for modest sums. Ultimately, the path forward may involve a combination of open communication and light-touch legal planning. Speak with your granddaughter, she will likely understand your desire to help all the grandchildren equally and to protect your gift from risk. Working with a solicitor to draw up a simple loan agreement or deed of trust can keep things clear, fair, and future-proofed without casting any doubt over your generosity. Your instincts to support your granddaughter now, to avoid unintentional unfairness later, and to encourage home ownership as a foundation for a secure life are deeply thoughtful. With some careful structuring and honest conversation, you can honour those instincts and give your granddaughter a wonderful start, while keeping options open for your other grandchildren too. Warm wishes, – Sam
Telegraph
23-05-2025
- Business
- Telegraph
I can finally afford to buy a London flat. Here's why I won't
I'd always assumed that as soon as I had scraped enough cash together to put a deposit down on a home, I would waste no time in getting on the property ladder. After all, that is what everyone does – or at least, everybody used to, because it was affordable and plain common sense. A typical first home cost under £50,000 in the 1980s, with the average first-time buyer aged 28 and equipped with a deposit of less than £3,000, according to research carried out by developer Keepmoat Homes. But things have changed drastically since I was born in 1997. The average English home now costs almost eight times the median annual salary, up from 3.5 then. The choice to buy a home has become monumental in financial terms – yet continues to be viewed as the most logical one to take as soon as it is feasible to do so.
CBC
21-05-2025
- Business
- CBC
Somebody will get this Irish countryside house for $9, if all goes according to plan
Social Sharing Imelda Collins says she's figured out a way to sell her home for peanuts, while still turning a profit. Instead of putting her house near Sligo, Ireland, on the open market through a real estate agent, she's raffling it off to a lucky winner, with tickets priced at £5, or roughly $9.30 Cdn. "I just thought that was a cool idea," Collins told As It Happens host Nil Köksal. If all goes well, she sees it as a win-win for her and the new homeowner. "The dream winner would be somebody that can't afford a house, or somebody that is struggling to get on the property ladder, which I'm sure a lot of people are," she said. "If my raffle is successful, in the end, I would hope to make more money than had I sold it on the open market." How it works While raffling is an unconventional way of selling your home, Collins says it's become something of a trend in Britain. She got the idea after reading a news article about a woman in Dublin who raffled her apartment so she could live her dream of moving to Paris. Collins says she plans to use the proceeds of her raffle to move to Italy to be with her husband and his family. "Initially, my husband ... thought I was crazy, to be quite honest," she said. "I assured him I'd done all the research. I wasn't jumping into it." Collins is running the raffle through Raffall, a British company that primarily runs online charity raffles. "We didn't anticipate house raffles," Stelios Kounou, Raffall's chief executive and founder, told the New York Times. "We never imagined people would do that." The contest, which closes Thursday, is open to people anywhere in the world. The company requires a minimum sale of 150,000 tickets for someone to win the house. If Collins falls short of that, the winner gets 50 per cent of the ticket sales, Raffall takes its 10 per cent cut, and she keeps her home. Kounou says the platform has successfully raffled 18 houses so far, while another 50 people tried but failed to reach the ticket sales target. Only bidders are allowed to know how many tickets have been sold so far, says Collins. But she's not worried. "I am very, very, very near to my goal," she said. "I can divulge that." Is it legal? To ensure everything is on the up-and-up, Raffall classifies its raffles as "prize competitions," as opposed to lotteries, which cannot be run for commercial or private gain. Britain's Gambling Commission defines a prize competition as one in which "the outcome is determined by the participants' skill, judgment or knowledge." To adhere to those standards, Raffall includes an entry question to qualify for the draw. For Collins' raffle, the question is: "Which colour is associated with Ireland?" In Canada, the rules around raffling and contests vary by province. Provincial gambling authorities have, at times, investigated or shut down real estate raffles and other contests to win homes. In an article posted by U.K. law firm Home Property Law, lawyer Cordelia Grassby urges potential buyers to take precautions before buying a raffle ticket for a house, including making sure you can afford utilities and maintenance costs, asking about associated legal fees and taxes, and, if possible, visiting the property or having it surveyed. Collins says she's promised to take care of the stamp duty land tax and any legal fees associated with the purchase. The house, she says, has been recently renovated, and comes fully furnished. Collins says anyone would be lucky to win her house, which she lovingly calls "Butterfly Cottage." Nestled on 0.7 hectares (1.75 acres) of rolling green hills, Collins says the home is surrounded by nature. From her porch, she watches rabbits hopping through the grass. There's a swallow building a nest beneath her roof, and a robin who stops regularly to eat from her hands. "I've had some really special experiences with nature," she said. "And the winner will hopefully experience similar things to what I did, you know, if they love nature as much as I do." She says she's brought that love of nature inside, too, with bright colours and nature-themed wallpaper, curtains and bedding. "Ireland is well known for not having good weather. So my idea was even if it's raining outside, at least you're sitting inside in your beautiful living room and you're looking at the beautiful design and the wallpaper and it's bright and cheerful," she said. She admits just selling Butterfly Cottage through a real estate agent might have been easier. But she likes the novelty of the raffle, and is fond of the idea that someone will get a house for less than the price of a lunch. "It would be lovely for somebody who can't afford a home to win," she said.
The Independent
13-05-2025
- Business
- The Independent
Rise in ‘boomerang kids' as nearly a quarter of parents say adult children have come back home
Adult children are increasingly returning to the family nest, with nearly a quarter (23 per cent) of parents reporting their offspring have moved back home after moving out for the first time. These 'boomerang kids' are typically staying for around two years, according to research from NatWest, with the average age of return being 26. However, the study reveals a significant portion (21 per cent) are over 30 when they move back in. Making the phenomenon more complex, some parents reported their returning children brought partners or even their own children with them. This trend coincides with recent data from UK Finance highlighting the crucial role of parental support in helping young adults onto the property ladder. The trade association's research shows that first-time buyers receiving family assistance purchase homes at an average age of just over 30, compared to 32-and-a-half for those buying without help. Rental prices have also surged in recent years, making it harder for some people to save for a deposit to buy a home. Research published by the Royal Institution of Chartered Surveyors (Rics) last week indicated that tenant demand increased in the three months to April. Combined with a decline in new landlord instructions, this suggests that rents will rise over the next few months, Rics said. NatWest's research found that 85 per cent of parents believe that it is more challenging for first-time buyers currently than it was in their era. Parents are also making their own adjustments as their 'empty nests' are refilled, with more than half (55 per cent) of those with a returning adult child having given up a dedicated home office or guest room in their home. NatWest also said just over two-fifths (42 per cent) of mothers surveyed would be happy to welcome their children back as adults, as would just over a third (34 per cent) of fathers. Three-fifths (60 per cent) of parents said they do or would charge rent. Barry Connolly, managing director of home buying and ownership at NatWest, which offers a family-backed mortgage, said: 'Many children across the country are having to return to the homes that they grew up in well into their 20s and 30s to give themselves the financial headroom to save for a deposit.' Yonder Consulting surveyed 2,000 people across the UK in April for NatWest.
