First-time buyers and the ominous 'Generation Rent'

July 13 2012

Much has been written on the struggles faced by first-time buyers with statistics pointing to a ‘Generation Rent’ situation.

These reports began in May when the ONS released figures that reported that almost 3 million people aged 20-34 were living with their parents in 2011, a 20% increase on the number in 1997.

Full story at http://www.guardian.co.uk/money/2012/may/29/3m-young-adults-live-parents

This was followed by a report from the Joseph Rowntree Foundation that concluded that the house shortage was turning the under-30s into ‘generation rent’. The Joseph Rowntree Foundation said that by 2020 the number of home owners under the age of 30 will fall from 2.4 million to 1.3 million, a drop of 46%.

Full story at http://www.guardian.co.uk/society/2012/jun/13/generation-rent-uk-housing-shortage

The figures certainly don’t look encouraging for first-time buyers and young adults who are looking to make their first step onto the property ladder. As headlines continue to predict the outcome of first-time buyers ‘Generation Rent’ may become a permanent fixture. According to the Kingsway Mortgages, half of 25-40 year olds believe that we will become a nation of renters by the next generation.

The increase in the size of the deposit, the lack of job security and high house prices are being pointed at as the main problems first-time buyers have to tackle. This can’t be helped by the fact that only 14% of 20-45 year olds are actively saving for a deposit. A statistic backed up by the 79% of parents who feel their children should spend less money on holidays and going out.

All statistics available from http://microsite.safeserve.com/kingsway/43/infomail.aspx

On the 13^th July edition of The Times’ Bricks and Mortar section the lead story continues to focuses on the plight of the first-time buyer and gives advice on how to secure that elusive initial mortgage. Indeed owner and managing director of Currell Residential, Anne Currell, is asked to offer her experienced advice on first-time buyers.

Mrs Currell said to The Times: “My advice for a first-time buyer is whatever you are buying the first priority has to be to find somewhere as close as possible to a transport hub; the Tube, the Overground or several reliable bus routes.”

Additional advice is directed towards looking for a flat that is in an area that has growth for potential rather than size and highlights north of Mare Street in Hackney and just north of Highbury towards Finsbury Park as two examples. Read the full article in 13^th July’s issue of The Times in the Bricks and Mortar pull-out supplement.