A QUARTER of young adults in Britain admit that they are relying on an inheritance to get on the property ladder, as house prices in the UK continue to soar.
While 25 per cent of British 18-34-year-olds think the only way they’ll manage to buy is by inheriting the cash, one in ten say they would leave the country in order to purchase a more affordable home.
Nearly half (48 per cent) of those surveyed by Halifax think it is harder than ever to get on the property ladder, and 25 per cent think they will never own their own home.
More than half of the 1,500 young people surveyed feel that the average house price for a first home in their area is currently unrealistic for them.
Despite the number of first-time buyers reaching a ten-year high last year, with 339,000 Brits buying their first home, half of 18-34-year-olds don’t think home ownership is a realistic option for their generation, with two thirds (65 per cent) saying they don’t earn enough to afford it.
Various government schemes have been unveiled in recent years to give people a helping hand on to the property ladder, including Help to Buy and Lifetime ISAs, which are set to launch in April.
A housing white paper has also recently been launched to help home buyers and renters.
But figures from the English Housing Survey recently showed that one in five households in England is living in private rented accommodation, while home ownership has fallen to its lowest level in 30 years.
Home ownership was at 62.9 per cent last year – the lowest proportion since 1985, and eight percentage points down on its peak of 70.9 per cent in 2003.
Martin Ellis, a housing economist at Halifax, said many young people feel they are running a “financial gauntlet” – by saving for a deposit, finding an affordable property in the right area and funding living costs.
He said: “It’s never too early to do some research to help build a better understanding of how much is affordable, the borrowing options available and calculating what’s achievable to help make owning a property more of a reality.”
One of the biggest issues faced by first-time buyers today is the need to save a big enough deposit, with the average around £32,000 in the UK – which is an unrealistic sum for many.
It’s not surprising then, that separate research by consumer body Which? found that nearly one in four first-time buyers took between five and ten years to save up enough for a house deposit.
How to get help buying a house
THERE are several government schemes available to help you get on to the housing ladder.
- Help to Buy loan: This scheme is for those who have a 5 per cent deposit, and is only available on new-build properties that are worth less than £600,000. The government lends you up to 20 per cent of the property value (interest-free for the first five years) which gives you access to cheaper mortgages. You will need to pay this back at the end of the mortgage or when you sell.
- Starter Homes: First-time buyers under the age of 40 can access this new scheme. You’ll get a 20 per cent discount on the market value of the property (new-build only) but you cannot sell or let the property for five years after you buy it.
- Shared ownership: This scheme is available to non-homeowners who earn £80,000 a year or less (£90,000 in London). People can buy a share of a home from a housing association and continue to rent the remainder. Buyers will need a ten per cent deposit as well as money to cover stamp duty and other fees. You’ll also need to find a mortgage lender that is willing to lend on shared ownership properties.
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