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A third of wannabe homeowners have given up hope of owning a property – and blown their deposit cash on holidays, cars and other luxuries, it has emerged. A study of 2,000 under 35s found that, despite the Government’s Help to Buy scheme, sky-high deposits still are crushing dreams of getting onto the property ladder.
Some 70% of those saving a deposit have become so disillusioned they have abandoned their attempts and spent the cash on holidays, cars or simply to cover bills.
In fact, one in two people under the age of 35 have ‘given up all hope’ of ever owning a property.
Lucy Chitty, Assistant Director of Sales for L&Q which commissioned the study, said:
”It’s clear that despite signs of recovery, many of the younger generation view the prospects of owning their own home as an unlikely dream.
”The study shows many are disheartened in their attempts to get on the property ladder and have abandoned efforts to save for a home altogether.
”Results revealed many people now see becoming a homeowner as so unrealistic that they’ve decided to splash money on temporary luxuries or intangible things, further reducing their ability to buy property in the future.
”Shared Ownership has historically been there to help support low income families purchase part of their home, but is now increasingly being seen as a way to get onto the property ladder in London.”
The study showed that three quarters of the 2,000 under 35s describe themselves as ‘nowhere near’ to even getting on the property ladder.
In fact, seven in ten think it will be at least five years or more before they can turn dreams of being a homeowner into reality.
A fifth of those saving deposits end up abandoning their attempts and spending the lot of it while a similar number spent ‘most of it’ and 31% spent at least some of it rather than leave it untouched.
Just 30% of those trying to get a deposit together have managed to leave their savings untouched.
Needing cash to cover the day to day bills was the biggest reason to dip into the deposit, while a third blew it on a holiday after giving up.
A dejected 15% say they’ll never try to get onto the property ladder again, but a determined third are still saving and one in six are exploring other ways of becoming a buyer.
Worryingly, 81% of the study felt it’s becoming less realistic to expect to own a home in Britain.
And nearly half say things haven’t gone to plan and they’d expected to own a home by now.
Reasons to abandon attempts to own a home altogether ranged from a worry about job security to a long-term relationship ending.
The average person thought 33 was the earliest age people could realistically hope to get on the ladder, after having saved for a deposit for at least six years.
A third of the sample had explored their property buying options and were disappointed as to what was available for their price range.
However, 70% said they had no idea of the full range of mortgage options available to them.
Lucy Chitty added:
”It’s important the message gets out there that there are many options for becoming a homeowner and other avenues they can explore.
”L&Q identified a lack of awareness in the consumer market and launched the PricedIn campaign as a way to demystify Shared Ownership. It created a platform to reach those who believed they were priced out of the London property market.
”Since launching the PricedIn campaign we have seen over 3,500 registrations and over 220 people housed through shared ownership since the beginning of the year.
”Shared Ownership really is one of the best ways to help improve the negative attitude to home buying in London that currently seems to exist and get people on the property ladder who currently believe it is out of their reach.”