- One in four Brits use savings to pay for holidays instead of putting towards house deposits
- Number of first-time buyers aged 16-34 has fallen by almost half (49 per cent) since 1981
- 42 per cent of 18-25 year olds prioritise saving for a holiday over a property
- A fifth (21 per cent) of over 55s rent instead of owning their own home
New research by leading price comparison website MoneySuperMarket today reveals that the profile of a typical first-time buyer in the UK is changing, while the overall number of people getting on the property ladder has dropped by a staggering 45 per cent since 1994.
When looking at the changing face of home ownership, the data reveals that a large portion of Brits are putting their dreams of buying a home on hold and instead using their savings for short term commitments. While 34 per cent of Brits are saving for holidays and travelling, only a fifth of Brits (19 per cent) are currently putting their savings towards home ownership. This is particularly high in the 18-25 year olds category, where 42 per cent have stated that they prioritise saving for a holiday over anything else, including property. In fact, 25-34 year olds consider saving for travel and holidays equally as important as saving for a property deposit.
This could be because getting on the property ladder has become more difficult over the last 20 years, with the average annual salary now accounting for only 11 per cent of the average house price in 2018, compared to 23 per cent in 1999. 16-24 year olds have been particularly affected, with a dramatic 68 per cent decrease in first-time buyers in this category between 1981 and 2016.
25-34 year olds are paying an average of 39 per cent more on rent than the over 55s did before purchasing their first home.
The data also reveals that there has been a 54 per cent increase in the number of 34-50 year olds renting from 1996 to 2016, with 60 per cent of 35-44 year olds citing a preference for renting over home ownership. A further 41 per cent stated that they weren’t earning enough to even consider saving for a home.
The current financial landscape means that more than a third of Brits (36 per cent) also find themselves compromising on the size of their property, while 29 per cent of those surveyed found they had to settle for a less preferable location.
More first-time buyers in the West Midlands (42 per cent) found they had to compromise on location when buying their first home than those in East Midlands (11 per cent), while 48 per cent of West Midlanders also found they had to compromise on their budget, the most of any region in the UK. On the other hand, for Londoners the biggest issue was found to be space, with more than half (51 per cent) stating the size of the property to be their biggest compromise .
For more information on how conditions for first time buyers have evolved, you can view the full research on the MoneySuperMarket website.
Top image Credit – Whatwolf