A quarter of young people believe the only way they'll ever own a home is by inheriting cash, research by Halifax has revealed.
The majority of those surveyed said that a shortage of affordable property is making home ownership a distant pipe dream, with more than one in ten (14%) believing they'll be renting forever.
Although the number of first-time buyers has actually been going up in recent times – it reached a 10-year high of 339,0001 in 2016, aided by a range of affordable housing schemes introduced by the government and tax hits to the buy-to-let sector – half of 18-34 year olds don't believe home ownership is a realistic goal for their generation, which is frequently labelled as Generation Rent, Generation Y or the millennials. Some 65% said they simply don't have the funds available to afford it.
In many cases, high deposits are the main barrier, with 52% of young people unable to stump up the cash for something so expensive. Given the years it now takes to save for a deposit, the research found that the average age of a first-time buyer has inched up to 30.
Additionally, more than half of young people feel that the average house price for a starter home in their area is out of reach, leading many to consider relocating to more affordable areas. 22% of those aged 25-34 would be willing to up sticks to a cheaper area, a figure that rises even higher for those aged 18-24.
On average, the deposit for a first-time buyer home is £32,3212, soaring to above £100,000 in the capital. In the South East it's £47,472, while Northern Ireland has the cheapest first-time buyer deposits, standing at £16,695.
The research also found that one in ten young people would be willing to leave the UK to find a more affordable home, while 25% are adamant they will never own their own property.
One in five said home ownership is now a thing of the past. Even for those who do manage to raise a deposit, 33% feel tough mortgage criteria is too difficult for them to meet.
“Even with the highest number of first-time buyers in the last decade in 2016, many young people still feel they are running a financial gauntlet – saving for a deposit, finding an affordable property in the right area and managing to fund living in the meantime,” said Martin Ellis, Halifax's housing economist.
“It’s never too early to do some research to help build a better understanding of how much is affordable, the borrowing options available and calculating what’s achievable to help make owning a property more of a reality,” he added.
Many lenders, in an attempt to help first-time buyers onto the property ladder, offer mortgages with just a 5% deposit. Longer mortgage terms also help to make monthly payments more manageable. In many cases, mortgage repayments now work out as cheaper than rent, but first-time buyers are still struggling to raise the necessary deposit amount needed to get the ball rolling.
Furthermore, the research highlighted how first-time buyers are now increasingly thinking long-term with their purchases. Some 28% of all first-time buyers in 2016 opted for a mortgage term of 30 to 35 years, up from 11% in the last decade.