Rising numbers of aspiring buyers feel permanently locked out of the housing market
The proportion of people resigned to a lifetime of renting continues to rise, with almost a third of aspiring homeowners now believing they will never own a property, according to new research from the Building Societies Association (BSA).
Its latest Property Tracker survey found that financial barriers remain the most significant obstacles for first-time buyers. Fifty-eight percent of respondents identified saving for a deposit as their main difficulty, while 54% pointed to the cost of monthly mortgage repayments.
Even with recent regulatory changes intended to give lenders more flexibility, 47% said that borrowing limits remain a substantial hurdle.
Concerns about government policy are also increasing. More than a quarter or 26% of those surveyed now cite stamp duty as a barrier to buying a home, up from 7% in September 2022. With property tax reform reportedly under consideration in the forthcoming Budget, uncertainty is contributing to hesitation among buyers and sellers, affecting market confidence.
Frustration with the complexity of the homebuying process has also reached a new high, with 14% now viewing it as a major barrier, compared to 10% in July. This comes as the government consults on reforms aimed at making property transactions simpler and less stressful, particularly for first-time buyers.
Market sentiment remains cautious. Only 17% of respondents believe now is a good time to buy, while 33% disagree, resulting in a net confidence score of -16%. This is a slight improvement from the summer, when the score was -21%.
The emotional impact of the housing crisis is clear. Forty-four percent of non-homeowners said they had expected to own a home by now, highlighting the growing gap between aspiration and reality.
Earlier BSA research found that first-time buyers are facing the toughest conditions in more than 70 years. Since the financial crisis, 2.2 million would-be first-time buyers have been unable to purchase a home. The share of 25- to 44-year-olds who feel homeownership is out of reach has risen from 27% in 2020 to 33% this year.
The rise of Generation Rent signals fewer first-time buyers and a shrinking pool of potential mortgage clients. Mortgage brokers may need to adapt by diversifying services, focusing on remortgages, buy-to-let, or specialist lending, and supporting clients facing affordability challenges. Building long-term relationships and offering guidance through complex market conditions will become increasingly important as fewer people expect to enter homeownership.
“For too many people, the dream of owning a home has turned into a sense of defeat,” said Paul Broadhead (pictured right), head of mortgage and housing policy at the Building Societies Association. “The financial barriers are well known, but it’s clear that policy uncertainty and the complexity of the process are now part of the problem too.
“Speculation about changes to property taxes may grab headlines, but it risks damaging confidence and creating unnecessary volatility. What buyers need most is stability, not stop-start interventions that distort the market.
“Building societies are working hard to support first-time buyers with flexible lending options and innovative mortgage offers. But lasting change requires a joined-up approach that focuses on housing supply, simplifies the buying process and creates the confidence that homeownership is achievable again. If we get that right, the future of the housing market can be a much brighter prospect for the next generation.”
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