‘Buying a home out of reach for our children’
Yahoo Finance UK
.By Lana Clements Yahoo Finance UK
Home ownership is slipping further out of reach for the next generation thanks to soaring house prices, it’s feared.
Half of parents have conceded that they will need to provide financial help for their children to have any hope of getting on to the property ladder, according to research by TSB.
But two thirds of first-time buyers from older generations were able to get on to the property ladder without family handouts.
Three-quarters of those surveyed by the bank said the cost of buying is too high, with Londoners the most worried about the difficulties of buying a property.
As well as high house prices, stamp duty is increasingly acting as a barrier to ownership. Two fifths of those from older generations didn’t pay the levy, whereas 90% of today’s first-time buyers have had to pay the tax.
It comes as separate research showed that rents increased in May, potentially making it harder for would-be buyers to save a deposit.
Residential rents edged up by 0.6% last month across England and Wales, showed data from LSL Property Services.
And rents in seven out of ten regions are higher than a year ago. The cost of letting remains most expensive in the capital, with London rents rising at an average of 1% per year to stand at an average £1,124 a month.
However, the overall increases are now below inflation, according to the index. And there is a considerable change of pace in the capital, offering tenants a little respite after rent rises reached 7.9% a year in 2013.
Overall, total returns for buy-to-let landlords have reached a four-year high, factoring in both rent increases and rising house prices.
“A squeeze on living standards may well be the biggest challenge of our age,” said David Newnes, director of agency Reeds Rains and Your Move.
“But rents are not the cause... Rather than conjuring up a storm, politicians should be working constructively to ensure there are even more homes available to let.”