Almost half (41%) of young people are feeling pessimistic about their chances of becoming a homeowner, new research from the Building Societies Association (BSA) has revealed. Despite this gloomy outlook, 48% of non-homeowners aged 25 to 34 still say they want to get on the property ladder.
The figures seem to be siding with the pessimists, as the percentage of 25 to 34-year-olds who own their own home has decreased from 40% to 33% over the last 10 years. While a lack of housing supply and the related high house prices are some of the main causes at the root of the issue, these aren't the only factors aspiring homeowners are struggling with.
The data shows that a large majority, 76%, find it difficult to secure a big enough deposit. This is followed by 46% who are struggling to access a large enough, or even any, mortgage deal, while 43% are worried about being able to afford their mortgage payments and 18% are concerned that property prices may fall in the future.
Although 15% are still worried about stamp duty, the abolishment of this tax for first-time buyers means that unless you're looking for a first home worth more than £300,000, this won't apply anymore. As for finding an affordable mortgage, that's where our Best Buys can come in.
If you've only got a deposit for 5% of the worth of the property, the first-time buyer chart can give you an idea of what you might be expected to pay every month (just click on Details for the product you're interested in). And if you've managed to get together a deposit of 10% or more, you'll be able to find even better deals in the general mortgage Best Buy charts.
"It is stark and worrying how gloomy many young people are about their chances of future home ownership," commented Paul Broadhead, head of Mortgage & Housing Policy at the BSA. "With the average age of a first-time buyer standing at 33, this is the very group most likely to be considering buying [but] without a massive push to build more homes to overcome the deficit of decades it is hard to see that things will improve."
It's hard to predict what the economy will do, but there is still help available. Aspiring first-time buyers can use a Help to Buy ISA or Lifetime ISA to gain a welcome Government boost to their savings, and those unafraid of taking some risks may even want to consider a stocks & shares ISA for the chance of higher returns over the long term (though note that any investment on the stock market means that you could also end up with less than you put in).
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