Most young people in UK would get a mortgage with a friend, research finds
The majority of millennials in the UK would take out a mortgage with two or more people to enable them to get a foot on the property ladder, new research has found.
Some 60% of young people aged 18 to 35 said they would consider taking out a mortgage as a group to make home ownership a reality, compared to 26% of those aged over 36, according to a survey from M&S Bank.
It also found that 20% of millennials do not believe they will be ever be in a position to own their own home, with saving for a deposit the main barrier. Indeed, 59% revealed that they have less than £1,000 saved up.
The move towards shared ownership is reflective of the lifestyles of millennials today, many of which have no option other than to rent, according to M&S Bank.
‘Many young people are trapped in Generation Rent because house prices seem increasingly out of reach. For many, home ownership appears possible only through sacrificing certain aspects of their current lifestyle, be that moving to a different area, moving to a smaller property than they’re renting, or seeing their disposable income take a significant hit,’ said Paul Stokes, head of products at M&S Bank.
‘But our research has shown that millennials are keen for an alternative option and joint home ownership is one of them. From housemate to mortgage-mate is a natural progression which can enable more people to achieve the otherwise unattainable dream of property ownership,’ he added.
The M&S Bank research found that 58% of those aged 18 to 25 live with a partner and 25% with friends. The vast majority, some 95%, said that living with others means they have company and can share the financial responsibility of a home.
‘Living with and buying a house with friends or family members alleviates the financial pressure of trying to afford home ownership alone, which is unattainable for many. The option of becoming a mortgage-mate is particularly appealing to those already in a housemate arrangement, and our research shows that the concept has become increasingly popular with millennials,’ Stokes concluded.