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Young people kept off property ladder

Young people kept off property ladder

Category: Mortgages

Updated: 25/07/2012
First Published: 25/07/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

High deposits and strict lending criteria are forcing prospective first-time buyers into rented properties.

Around 38% of young people feel trapped into renting homes, rather than venturing onto the property ladder because of funding costs.

Selected mortgage lenders have reduced their rates lately; however, strict lending requirements have meant many potential buyers are having their applications withdrawn. Sometimes even the smallest mark on credit histories can go against a mortgage decision.

According to the Royal Institution of Chartered Surveyors, who compiled the figures, almost a fifth of those who have attempted to purchase their first home have seen it fall through as a result of funding.

Peter Bolton King, RICS global residential director, said: "Many first-time buyers are facing the prospect of a property ladder with no rungs. With lenders requiring such hefty deposits and affordable mortgage deals out of reach for most, a generation of potential homeowners are facing an uphill struggle. Without allowing more first-time buyers to enter the market, chains will continue to stall and transaction levels will stagnate."

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