Four in 10 aspiring homebuyers are putting their plans on hold, waiting for house prices to drop, according to a poll of 2,000 adults who do not currently own a home.
Prospective buyers have, on average, around £36,000 set aside for their first property. In London, would-be first-time buyers have amassed even larger deposits, with average savings standing at more than £46,000.
Buyers confident but cautious
Half of people feel confident they already have enough money in the bank but are waiting for prices to feel truly financially secure. Nearly 45% still want to save a deposit worth at least 20% of their ideal property's value before buying, despite only needing 5% to get onto the ladder.
Another 29% want to make sure they have an emergency fund in place before committing to a purchase.
Research findings
The research found 77% of prospective buyers are keeping a close eye on house prices in their local area. Even among those who already have enough saved for a 10% deposit, 83% remain cautious about taking the plunge.
For some, the right time to buy is as much about reaching personal milestones as it is about what's happening in the housing market. One in 10 want to know where they want to live long-term before buying, while 9% are waiting for a pay rise or promotion. A further 8% want to be in a long-term relationship before taking the plunge.
Reasons for waiting
It also emerged 30% hope delaying their purchase will allow them to buy a "forever home" rather than a "starter home", according to the OnePoll research. Meanwhile, 18% believe waiting could help them secure an additional bedroom.
Oli O'Donoghue, head of mortgages at HSBC UK, which commissioned the research, said: "Wider market conditions can change frequently, which can make people feel they should wait a little longer before making a move.
"While it's natural to keep an eye on what's happening in the market, and there can be a tendency to try and find 'the right time' to buy, buying a home is a really individual journey and should also be viewed through a personal lens.
"Waiting for the perfect time could also mean passing up the 'perfect' home, so those who are financially ready may benefit from exploring their options, rather than putting their plans on hold.
"Where you are in life, your financial position and your longer-term goals are all important considerations.
"For many people, the decision to buy isn't just about what the market is doing today, but whether they feel ready for such a significant commitment."
O'Donoghue added: "Buying a home is one of life's biggest milestones, and it's natural to want to feel confident that you're making the right decision for your future.
"While there's no shortage of predictions about the housing market, everyone's circumstances are different.
"Understanding what you can afford, exploring the options available to you and thinking about your longer-term goals can help you make a decision that feels right for you.
"Speaking to a financial expert can help people navigate their options, understand the steps they can take towards homeownership and feel more confident about moving forward with their plans."
