It’s not just those in their 20s and 30s who find it hard to get on the property ladder. Those in their 50s are also struggling, 23 per cent either renting or living with their parents, according to Alliance & Leicester Mortgages' movingimproving index.
Surprisingly, nearly a quarter of Britons in their 50s are renting (22 per cent) or still living with their parents (1 per cent) and do not have a home to call their own. However, the survey reveals 41 per cent of these non-homeowners desperately want to buy but cannot afford it.
Compared with this time last year, the ‘babyboomer’ generation is having more trouble getting on the housing ladder. Last year, 33 per cent of the over-50s faced this problem. Looking at regional attitudes of the over-50s, over half of those who are non-homeowners in the South East think they can’t afford a house (58 per cent) compared with those in London (45 per cent).
Nevertheless, it is still those in their 20s and 30s who feel they are not able to afford to get on the housing ladder. According to recent reports, a first-time buyer is now on average 34 years old before they get on the first rung and the research reveals that over half of non-homeowners in their 20s (56 per cent) and 30s (58 per cent) most complain about house prices being out of the reach.
Stephen Leonard, director of mortgages at Alliance & Leicester, commented:“Our research reveals that the affordability issue is more widespread than you’d expect and not just something that affects Britain’s youngsters. Although those in their 20s and 30s are most affected by this problem, an increasing number of those over 50 are also finding it hard to afford a house.”
Outlook for first-time buyers and stamp duty
First-time buyers seem to be setting their sights at higher value properties compared with this time last year.
Despite a £5,000 increase in stamp duty in this year’s Budget, first-time buyers are not escaping the tax. In fact, the research reveals that more first-time buyers are likely to pay stamp duty now compared with this time last year. Last year, 41 per cent of potential first-time buyers were looking to spend over the stamp duty threshold of £120,000 and would have paid the tax, but now this has nearly doubled and nearly two thirds (61 per cent) are looking to spend over this year’s threshold, £125,000.
Furthermore, 11 per cent of aspiring first-time buyers will incur the three per cent stamp duty tax as they are looking to spend over £250,000 on their first property. This has doubled since this time last year (5 per cent).
Stephen Leonard continued: “Despite house prices rising by just over £3,000 in the last year, first-time buyers seem to be setting their sights much higher. The number of first-time buyers looking to buy a home over £250,000 has more than doubled and hopefully this trend is due to better financial planning allowing them to have more money to get their dream first house.”
Other findings revealed:
Nearly half of non-homeowners (47 per cent) want to buy a home but feel they cannot afford it.
More women feel they cannot afford to get on the housing ladder than men (52 per cent vs 41 per cent).
In London, over a quarter (27 per cent) of first-time buyers are looking to spend over £250,000 on their first home. Only eight per cent are looking to buy a home under £125,000.
