Mortgage blog: One in five young people have given up on buying a property
A fifth of 25- to 40-year-olds in the UK have abandoned their dream of owning their own home due to rising house prices and the difficulty in obtaining mortgage finance. A new survey from Halifax, one of the UK's major mortgage lenders, has also found that seven in ten people don't believe government initiatives will help them get onto the property ladder and believes that this could have serious long term issues for society and the mortgage market.
Seven in ten people believe Britain is socially and economically divided by homeownership
The survey of 8,051 people found that one in five 25- to 40-year-olds have given up on the idea of owning a home amid the barriers to property ownership. The International Business Times reports that "about 36% of the respondents were of the opinion that they would like to buy a home but they do not think they would ever be able to do so.'
Halifax's mortgages director, Craig McKinlay, says: "Homeownership is clearly still an important goal for a lot of people, but fewer and fewer people consider it to be something they'll be able to achieve. Renters say they never feel properly settled and fear they will struggle to retire, so the social impact of this shift is significant. More needs to be done to redress the balance, both through making homeownership more accessible and offering more stability through the rental sector."
Young people in Britain are also unconvinced that government initiatives to stimulate the mortgage market will help them. Over the last year several schemes have been announced including the Funding for Lending initiative and the Chancellor's multi-billion pound mortgage guarantee scheme.
However, about 70% of the respondents to the Halifax survey were not optimistic about government plans to help homebuyers.
"Despite all sorts of schemes and policy changes the fact remains that it's still tough for a first-time buyer to get onto the property ladder," says Keith Osborne, editor of WhatHouse.co.uk. "There are still only a handful of 95% mortgages available - just 54 according to the most recent research - and so it's not surprising that young people are struggling. What may be more worrying is that 70% of young people now believe that the country is divided by property ‘haves' and ‘have nots' which could have a serious effect on neighbourhoods, society and the job market in coming years."
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