Generation Rent finding it even harder to get on the ladder
Two-thirds (66%) of renters want to own their own home, but it’s getting harder as a result of the pandemic, according to Vida.
The specialist mortgage lender said that one in five renters (19%) who want to buy are finding it harder than before to step onto the housing ladder because of COVID-19.
This includes a fifth (20%) of key workers that rent, who are now having to reconsider their plans to buy.
Why is it harder?
More than a quarter (28%) of renters who have had to push back their plans to buy say the virus has caused a fall in their income which has made buying less likely.
More than a quarter – 27% – have had to dip into funds that could have been used to help them buy a home of their own.
The research also revealed that a tightening of lending criteria had made it harder to get a mortgage, with 29% saying that stricter lending requirements had it much harder to buy.
Anth Mooney, CEO of Vida, said: “Generation Rent has been hit hard by the pandemic. While some younger buyers are lucky enough to get help from the Bank of Mum and Dad, millions of individuals underserved by the mortgage market are stuck in a cycle of renting. Finances have been hit by furlough and/or sudden loss of income or job security.
“This is not a problem which just affects young people. From the over-55s who have always aspired to own their own home to the key workers – the nurses, the social workers and the supermarket delivery drivers that are putting themselves at risk to keep us safe during this pandemic – Generation Rent spans all of the ages. At Vida, we think that those people who want to buy should have a fair opportunity to find a safe place to call a home of their own.”
Andrew Montlake, managing director of Coreco, said: “It is challenging at the best of times to purchase a home with house prices having risen, fuelled by pent-up demand and the Stamp Duty holiday, while higher rents and increases in the cost of living make saving for a deposit trickier.
“The concern is that the gap between the haves, those that are lucky enough to have larger savings pots or assistance from parents and family, and the have-nots is getting wider and wider. We need a concerted effort from government, the housing industry and the mortgage market to ensure that we do not have a lost generation of prospective homeowners.”