Your Business and Industry

02 December 2021

Four out of five renters want to own a property but financial obstacles cited as main barrier

According to our research, four out of five renters want to own a property in the future however cite a number of financial barriers as potentially stopping them from meeting this goal.

The research, carried out by BVA BDRC on behalf of ourselves, interviewed 300 individuals on their housing aspirations during Q3 this year, seeking to understand how renters felt about how they might make a first purchase and what was required in order to do this, and the obstacles that had been overcome by those who already own their home.

Interviews with those currently renting revealed a strong desire to become an owner occupier with the most commonly anticipated timeframe for this being three to four years. However, when asked what barriers they would need to overcome first, 31% said a low/unstable income or salary, 31% said they had no deposit or were still saving, and 10% said their current credit score/debt history might count against them.

Almost two out three respondents felt now was a good time to be a property owner. However, when asked if now was a good time to be looking for a mortgage that number dropped to 44% and only 39% said now was a good time to be a first-time buyer.  

The ambition to become a homeowner was revealed to be important not just as a place to call home – almost three in four said their property is a home rather than an investment – but over half said they saw property ownership as part of inheritance planning and say price growth is therefore important.

Just over a third (35%) of respondents said they would be interested in a multiple-person mortgage allowing a number of borrowers to purchase a home together, however this rises to two-thirds of 18-34 year olds.  A high proportion - 64% - of all those respondents who have children under 18 were also interested in the option.

When existing homeowners were asked what (if any) kind of financial assistance they received when arranging their last mortgage, 63% said they had received none, 24% had used parental help, 5% had support from other relatives, 5% used a Government Deposit Scheme, while 3% had assistance from friends.

Nearly three quarters of respondents said they anticipated needing no financial assistance when they arranged their next mortgage (73%), 5% would get help via parents or a Government Deposit Scheme, 3% from other relatives, and 2% from friends.

We offer a full range of specialist residential mortgages, including options for up to 4 family members buying together, and accepting gifted deposits from extended family. Almost all of our residential mortgage products are available to first time buyers, plus other borrowers including those recently self employed, those with multiple or unusual sources of income, those with low credit scores, and those who have experienced credit blips.

George Gee, our Commercial Director, said:

“It’s clear from our research that home ownership in the UK continues to appeal, with a significant number of those not already on the housing ladder wanting to make their first move into their own property as soon as they can.

“Yet, we can also see that many would be first time buyers feel they have obstacles to overcome in terms of their financial situation, their ability to secure a large enough deposit, and their credit status. The good news is, that the specialist mortgage market has moved significantly towards would-be borrowers in recent times, however, their awareness of a greater number of potential options remains an issue..

“The needs of specialist residential borrowers are increasingly well-catered for, especially first time buyers and those who may be looking to remortgage but feel they have some unique circumstances, or do not fit the ‘standard’ requirements of the mainstream lenders around their income or credit or employment.

“As a lender highly active in this space, we want to encourage both first-time buyers and existing homeowners to utilise the services of mortgage intermediaries  in order to secure access to expert advice, and the products and finance solutions which they may otherwise believe simply don’t exist.

“Lenders like us can accommodate a huge range of borrower types, whether they are seeking to finance a purchase or require specialist underwriting to remortgage an existing loan. We have an opportunity to make property dreams a reality here and, with the support of the intermediary community, we can enable this for a growing number of people.” 

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