Less than a quarter of people wanting to buy a property in UK likely to do so
Friday, 01 April 2011
Over 80% of non home owning adults in the UK aspire to be a first time buyer but less than a quarter expect to be able to buy a property within next five years, according to research published today (Friday April 01).
A survey from HSBC shows that 78% of all non home owners, who have never bought before, aspire to do so, 86% of those aged 18 to 24 want to buy and 84% of 25 to 34 years olds are in the same position.
According to HSBC this means that over 90% of all UK households want to own a home compared with 68% who actually do so.
But the research shows that only 19% expect to be able to realise their dream in the next five years and 45% do not expect to be able to purchase a home ever.
Among the more optimistic are the younger age group of 18 to 24 year olds, of which 22% expect to buy in the next five years but 21% do not expect to ever be able to own their own home.
Some 69% of those who took back in the survey said that raising a deposit is the main hindrance while 59% said it was insufficient income to pay a mortgage and 27% said they were worried about losing their job. Only 12% said they were concerned over future falling house prices.
The current average price of a home for a first time buyers is £136,842, some 6.6 times a young single persons average earnings of £20,654. With lenders across the industry typically reluctant to lend more than four times income, this leaves an affordability gap of 2.6 times income, equivalent to £53,700 or 39% of the house price.
In order to afford a 90% Loan to Value (LTV) mortgage, the maximum a standard lender will currently allow, a typical firs time buyer home earnings would have to be £30,800, 49% higher than current average earnings for a single young adult.
There is the possibility to not be a statistic.
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