Only one in three Brits think home ownership is achievable in their lifetime
Only 30 per cent of Brits expect to be able to afford a home within their lifetime, according to fresh research.
Home ownership has become increasingly out of reach for Brits in the last three decades as wage increases have failed to keep up with rocketing house prices.
The findings, from Barclays, represent a stark departure from figures for older generations, with 76 per cent of over-55s in England owning their own home, and 74 per cent of those aged 65 and over owning their home outright.
The perceived biggest barrier to homeownership is the cost of a deposit, with high property prices the second biggest concern, according to Barclays.
“There is more work to be done… if we are to create a more dynamic housing market for everyone,” Jatin Patel, head of mortgages, savings and insurance at Barclays, said.
After reaching a low of 2.0 in 1995, the house price to earnings ratio has been on a generally upwards – worsening – streak, peaking at 6.0 in 2021.
A prospective buyer earning the average UK income and buying a typical first-time buyer property with a 20 per cent deposit would have a monthly mortgage payment equivalent to 36 per cent of their take-home pay – well above the long-run average of 30 per cent, according to the Nationwide Affordability Survey.
Young renters rely on ‘bank of mum and dad’
However, it appears that older renters are more likely than younger Brits to think home ownership is unacheivable.
Nearly half – 48 per cent – of Gen Z renters, and 41 per cent of Millennial renters, think homeownership is within reach within the next five years, with half of Gen Z and 47 per cent of Millennial renters saving for a deposit to buy a home, Barclays found.
Notably, however, 40 per cent of Gen Z respondents said they would find it impossible to buy a home without inheritance or a loan from a family member.
The ‘bank of mum and dad’ gifted or loaned £9.4bn in 2023 – a figure which has nearly doubled in the last five years.
Mike Ward, Armalytix chair, said: “Family gifts increasingly determine who can move forward and who remains stretched… those with larger family backing move ahead, while others face higher costs and greater risk.”
Nationwide found that 40 per cent of all deposits in 2024 were either from inheritances or gifted.
“Those who have the option of family support… find it much easier to get onto the housing ladder and only the highest earners and those who have received significant support are likely to be able to buy at the top end of the market,” Frances McDonald, director of residential research at Savills, has said.