Property ownership for millennials may be a pipe dream
The dreams of owning a house are slowly evaporating for prospective UK homebuyers, with younger generations facing a lifetime of instability thanks to increased prices, according to a recent study.
A poll carried out by Ipsos MORI has found that 74% of those aged 25-34 believe it is harder for them to put down roots than it was for previous generations. Thanks to the continually rising property prices across the UK and the widening gap between those prices and average wages, many young people are facing a lifetime stuck in the rent cycle, already moving twice as often over the course of their lives than those who are now retired.
At the turn of the century, the price of an average house was a meagre 3.2 times the average wage, but in the last 15 years, this has risen to 5.5 – the steepest rise the property market has experienced in almost 80 years.
The far-reaching implications of the current housing crisis is even being felt in the nation’s capital, where recent graduates cannot afford to buy or even rent homes, despite enjoying starting wages of £40,000 to £45,000 – ultimately forcing them to look elsewhere for work and potentially even threatening London’s position as the business capital of the world.
“The cost of buying a home bears no relation now to what people can afford,” said Campbell Robb, chief executive of charity group Shelter. “We are seeing a generation of people now in their 50s or 60s who are looking at their children, and their children will be worse off than they are.”
Without an increase of government spending on affordable new-build homes, the situation may be set to get worse. Rental deposits are expected to skyrocket by 40% over the next ten years, meaning that simply securing a deposit will swallow over 70% of the monthly average wage of UK workers, rising to 120% in London – and leaving many without the resources to secure a mortgage at any point in the near future.
This also leaves many sellers in a difficult position, as the pool of potential buyers is substantially reduced – meaning a fast house sale is out of the question if they live in a less desirable area. Of course, many sellers can still take advantage of house buying companies, who are willing to buy any house for cash with faster processing times than traditional estate agents.
Are you worried your house is not getting enough viewings? Why not ask National Homebuyers for advice, as we buy any house. Call 08000 443 911 or request a call back to find out how much you could get for your property