Outpacing wage increases, rocketing house prices, an ever-challenging mortgage market and poorer job security have all influenced young people looking to get on the property ladder.
Resultantly, Millennials or Generation Y (those born between the mid-1970s and mid-1990s) are extensively predicted to become the first-ever generation to do financially worse than their parents and grandparents.
Battle Against Increasing Odds
While this generation is struggling to develop careers and improve their earnings, the ratio of house price to income has continued to heighten, creating challenges for today’s first-time buyers.
One of the biggest hindrances for Millennials has been the savings required for a down payment. While the government-backed schemes have been a great help, it is still the case that with the ongoing rise in house prices many are incapable of saving sufficient funds.
High rents also act as a factor contributing towards this. Escalating rents can make the issue complex, making it less likely for a prospective buyer to accumulate adequate savings to get a foot on the property ladder. This is now observed in tenants’ expectations of buying a home. Since it is becoming difficult to save for a deposit, it has been reported that only 11 per cent of tenants feel they will be able to get onto the property ladder, plunged from 13.4 percent, this time last year, while 13.1% have accepted that they will perhaps never be able to get home ownership, up from 11.0 per cent twelve months ago.
Getting your priorities right
However, many of the difficulties faced by Millennials are also accompanied by lifestyle choices. There is now a type and level of expenditure that many Millennials now think of as ‘essential’ which debatably in previous generations would have been deferred until after they had bought a house.
Is there hope
For many, there are options available to them to make this process easier, but most don’t even know what options are available and who to turn to.