Potential first-time buyers feel disheartened about their chances of getting on to the housing ladder, with over one in four saying it will take ten years to raise the deposit.
Trade body the Building Societies Association says only 26% potential buyers recently surveyed expect to raise a deposit in three years or less. In 2008, the proportion was 69%.
Nearly one-third of potential first-time buyers believe that things will get harder for them next year, saying that high rents and the cost of living are making it difficult to save.
Among those planning to buy for the first time, 23% said they believed they would do so next year, compared with 73% who said they would still be renting or living with family.
BSA head of mortgage policy Paul Broadhead said: “Buyers and lenders alike are adjusting to a new kind of normal in the UK housing market and the headwinds generated by a weak economic environment mean that it is here to stay right now.
“It is, however, a complete myth that no first-time buyers are getting their feet on to the housing ladder. Between January and October 2012, building societies and other mutual lenders helped 22,000 more first timers buy their own home than in the same period last year, with around one in every three mortgages made to this group.
“Mutual lenders have contributed most of the net lending in the UK this year as some banks have shrunk their balance sheets.
“Looking ahead to 2013, there is no doubt that sensible creativity will be required from all of those involved in the mortgage market.
“There is potential to grow and develop alternative forms of tenure for the future, although simplicity and transparency for the consumer must be at the core of any such developments.
“In addition, it would be helpful if government and regulators could decide their priority between the ‘lend and lend now’ rhetoric and the demands to grow capital – lenders can’t do both.”
Comments
Hawkeye,
I admit it is very very difficult to get a mortgage,
However you have only covered some of a banks risk analysis.....What was the salary multiple your applicant was asking for? What industry / sector were they working in.
I asked before what would be sensible lending to you?
“It is, however, a complete myth that no first-time buyers are getting their feet on to the housing ladder". What drivel some are but there are so many restrictions now the lenders are being so picky that it is a wonder any mortgages are granted. For example, 40% LTV turned down no reason given, minor electrical works required and no offer forthcoming until works completed, 2 days late in paying one credit card bill in the last year loan refused. I am sure others will have heard of other lame excuses for mortgage refusal. I bet god would have a problem getting a mortgage today.