First time buyers need to take a lesson in the true cost of purchasing their first home, according to research from Alliance & Leicester.
The mortgage provider found that six in ten prospective buyers who are currently renting or living with their parents are expecting to spend only up to £120,000 on their first home - when the average first time buyer property costs £149,470.
This lack of price realism could see first-timers needing a £33 billion collective windfall to hoist themselves onto the first rung of the housing ladder.
"Although they need to keep their costs low, first time buyers should perhaps reconsider their budgets. The majority are looking for a house under £120,000 but realistically they may need to be looking closer to £150,000," commented Stephen Leonard, director of mortgages at Alliance & Leicester.
"These unrealistic expectations will cost over £33 billion to those who want to get onto the first rung of the housing ladder but are still renting or living with their parents."
Alliance & Leicester's research reveals the extent to which the cost of buying their first home is worrying the prospective homeowners - 28 per cent of those who do not own their home feel they can't afford to.
Mr Leonard advises first-timers not to feel too gloomy, however - many mortgage providers are unveiling good deals that could help relieve the difficulties.
"Although their first steps might feel uncertain and shaky, they should be aware that there are many positive moves that lenders are taking to ease the stress," Mr Leonard stated.
"There are many good mortgage deals that prospective home buyers can take advantage of."Click here to find out more about first time buyer mortgages.
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