"The HomeOwners Alliance has been tracking views of consumers for five years now, and these latest findings show that the housing crisis is deepening across the UK"
According to a new study by the HomeOwners Alliance and BLP Insurance, over 250,000 non-homeowners appear to have given up on the dream of owning their own property in the past year alone.
However, the 2017 Homeowners Survey found that for the first time in five years, there has been a drop in the number of non-homeowners who aspire to own.
According to the figure, in 2013, 65% of non-homeowners aspired to homeownership, with this number increasing every year and peaking at 73% in 2016. But this year, the numbers have fallen for the first time, back to 71%. This equates to around 253,166 people across the country who have given up on ownership in the past 12 months. The stats mirror the rise of the government’s flagship Help to Buy programme launched in 2013 and is now receding with the cancellation of the mortgage guarantee part of the scheme in 2016.
Five years on from the first Homeowners Survey, aspiring homeowners’ concerns about house prices, saving for a deposit and availability of homes are the biggest issues and are worsening with time. Among aspiring first-time buyers, 86% say house prices are their most serious concern (up 3% in the past year), with 85% citing saving for a deposit as a serious problem (up 1%) and 80% worried about the availability of homes (up 2%).
The findings also reveal a deepening housing crisis, with concerns rising in nearly all areas of the country. London is suffering acutely, but the problems are not contained to the capital. While Londoners are the most concerned with house prices (87% saying that they are a problem), this is also echoed in Wales (87%) and the East of England (85%). Similarly, availability of housing is a concern for Londoners (81%) but slightly more people in the South West (82%) also stated that it was an issue in their region. Elsewhere in the country, concerns were about being able to re-pay a mortgage, particularly in Yorkshire & Humber (68%) and Northern Ireland (68%).
Across the country, the number one concern among Britons remains the difficulty of getting on the property ladder in the first place. This was seen as even more of a problem this year (86% saying that it was a problem or serious problem) than last year (82%). While average earnings have increased 2.6% annually, average property price growth over the same period of 4.5% has out-paced this.
Paula Higgins, Chief Executive of HomeOwners Alliance said: “The HomeOwners Alliance has been tracking views of consumers for five years now, and these latest findings show that the housing crisis is deepening across the UK. This in turn is impacting on people’s aspirations to get on the property ladder. While we are used to stories about people not being able to buy a home until they are 40, the story has taken a turn for the worse with people increasingly giving up altogether on the dream of homeownership.
While aspiring homeowners’ concerns about house prices, saving for a deposit and housing supply grow, the change in political rhetoric around homeownership and a lack of new homes being built in the last year, plus the removal of flagship government schemes like the Help to Buy mortgage guarantee, appear to have had a negative impact on consumer attitudes. People are feeling less optimistic about their chances of buying their first property.
With the election approaching, it is vital that housing is placed at the forefront of the policy agenda and that whatever party is elected, it takes serious steps to address the growing concerns of aspiring homeowners.”
Kim Vernau, Chief Executive Officer of BLP Insurance, had this to say: “The housing crisis is worsening across the country. We are failing to deliver the numbers of homes required as a direct result of a lack of SMEs to develop over and above the numbers provided by the large house builders. The recent housing white paper from the Government proposes a wide variety of recommendations to the market for consultation, to address issues with planning and resource, with a distinct shift away from focusing solely on home ownership. This is a tacit acknowledgment that not everyone will be able to own their home.
It is important that post the election result, the provision of housing is seen as a critical requirement and the results of government consultations prioritised into action. In the absence of this, the opportunity for aspiring new home owners to get on the housing ladder will only continue to deteriorate.”
There is some good news. Concerns are receding on issues such as negative equity and the ability to move up the housing ladder. Some 42% of UK adults say they are concerned about negative equity, compared to 44% last year, 49% in 2016 and 64% in 2014; after a steady increase in house prices. Alongside this, concern about the ability to move up the ladder has softened, down 4% in the past year to 58% (compared to 65% in 2014).
In Newcastle, Sunderland, Middlesbrough and the wider North East region, the major concern is the ability of first time buyers to get on the property ladder, with 82% of respondents citing this as a worry. Those in the North East had the least trouble with finding a property and being able to move up the housing ladder. However, this ease of availability seemingly comes at price; 54% see the possibility of negative equity as a serious problem.
82% of Mancunians, Liverpudlians, and others in the North West are anxious about the ability of first-time buyers to get on the property ladder. Being able to save for a deposit to buy is also a significant worry. However, those in the North West appear to have fewer concerns than other regions with housing for the elderly, with just 43% saying it was a worry.
Yorkshire and the Humber
Respondents in Yorkshire and the Humber are the most concerned in the country when it comes to being able to pay off their mortgage. However, saving for a house deposit remains the biggest worry, with over 80% saying it was a serious problem for them.
People in Nottingham, Leicester and Derby and the wider East Midlands region are the most concerned with the ability of first-time buyers to get on the property ladder and saving for a deposit (87% and 82% respectively). Availability of housing and negative equity are far less of a worry for those in the East Midlands, with just 43% and 42% of those surveyed anxious about these issues.
The ability of first time buyers to get on the property ladder concerns a massive 85% of those surveyed in the West Midlands. Those in this region are some of the least concerned with saving for a deposit to buy, though this still worries 77% of respondents.
East of England
The East of England has seen some of the UK’s biggest property price increases in recent years, so it is unsurprising that 88% of those in this area are worried about the ability of first-time buyers to get on the property ladder. It was also one of the regions most concerned with the archaic leasehold/freehold system.
Perhaps unsurprisingly, nine out of ten Londoners said they worried about the ability of first-time buyers to get on the property ladder. The capital’s inflated property market means that stamp duty rates, house prices and even just being able to find a property to buy are all big concerns for those who live there.
With the London market having cooled over the past year, property price growth in the commuter belt has outstripped the capital in many areas. Increasing house prices are a big worry for those in the South East, with 84% of respondents concerned, a trend which closely mirrors London.
The South West region indexes highly on a number of key housing concerns. The ability of first-time buyers to save for a deposit and get on the property ladder both worry nearly nine out of ten respondents, while those in the West Country are also the most concerned of any region about the availability of housing.
Those in Wales are most concerned with saving for a deposit, with 87% of respondents admitting it is a serious worry. However, with many areas of Wales having a good stock of affordable homes, they are one of the regions least concerned with being able to pay off their mortgage.
With Scotland setting its own rules on property transactions and practices, it is no surprise that Scots are less concerned about the homebuying process, gazumping and the leasehold system than most other areas. Their biggest concern is the ability of first-time buyers to get on the property ladder, with 76% of those surveyed worried.
Those in Northern Ireland are the most concerned of the regions surveyed about a number of other property issues such as negative equity, being able to pay the mortgage, estate agent fees and housing for the elderly.