Study finds 73% of aspiring buyers feel locked out of the property ladder, with high rents cited as the primary barrier
A third of renters in the UK are saving £100 or less per month, leaving them facing up to 35 years to accumulate a deposit, according to research published by Skipton Building Society.
Data from Connells, part of the Skipton Group, shows the average first-time buyer deposit currently stands at £41,403, with properties purchased by first-time buyers averaging £243,883. Those starting with no savings face the prospect of that target moving further out of reach should house prices continue to rise.
The survey of 1,000 aspiring buyer-renters found 73% feel locked out of homeownership. Nearly half (45%) attributed this to high rents impeding their ability to save, with 32% spending between 40% and 60% or more of their monthly salary on rent — well above the widely used 30% affordability threshold.
Some 68% of respondents said they feel their lives are on hold while they save for a first property alongside paying rent. The vast majority (94%) reported making financial sacrifices, including cutting back on holidays (49%) and socialising (45%), while one in five has delayed major life decisions such as marriage or having children. Two in five (43%) said these sacrifices had negatively affected their mental health.
Separately, 35% of respondents described the saving process as long and exhausting, while 30% said they felt anxious about their financial future. Despite this, 32% said they believed the effort would prove worthwhile.
On the question of what would help most, 34% of renters pointed to lower deposit requirements, 31% called for more affordable housing to be built, and a quarter said lenders should more readily accept rental payment history as evidence of mortgage affordability. A further 24% cited the need for more flexible mortgage products.
"Getting onto the property ladder is becoming increasingly challenging for renters, as they try to balance the cost of living with saving for a deposit and all the other associated costs that come with buying your first home," said Jen Lloyd (pictured right), head of mortgage products and proposition at Skipton Building Society. "The figures in our latest research are a stark reminder of the pressures many are facing, often despite already demonstrating they can afford significant monthly housing costs.
"In many cases, renters are already meeting payments comparable to a mortgage, but the barrier of saving a deposit continues to hold them back. We believe it's only fair that people who have demonstrated they can afford regular rental payments have a real opportunity to become homeowners, even if high rental costs have made it difficult for them to save for a deposit."
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