69% of millennials remain defiant in homeownership plans despite affordability challenges – Together
The challenging economic environment has done little to dent the UK’s enthusiasm for bricks and mortar, new research from property lender Together has revealed.
The average age of homeownership for millennials (those aged 28 to 43) now stands at almost 10 years higher (34 years old vs 27 years old) than when the baby boomer generation (those aged 60 to 76) were getting on the ladder, due to the market being less volatile.
Indeed, over a third of baby boomers admit they wouldn’t change their priority toward homeownership if they could rewind the clock to when they were younger and first had money to invest.
But, far from creating a generation of self-styled GUPPYs – those who are giving up on property – Together’s study suggests that 69% of millennials still hold burning aspirations to pick up the keys to their own property in the next five to 10 years – despite the odds stacked against them.
Indeed, Together’s own customer data shows that the number of mortgages provided to first-time buyers in 2023 was about 9% more than in 2022.
Interestingly, despite it being far cheaper to access property 50 years ago, boomers who first bought a home in the 1970s are less likely to consider property as an investment vehicle – compared to their saving savvy millennial children.
When asked what they would put their money into if they had £25,000 or more to invest, over half (52%) of millennials chose property – compared to just 17% of baby boomers, who view cash savings or ISAs more appealing (at 30% and 28% respectively).
Even with more constraints on their short and long-term finances, millennials looking to own property in the next five to 10 years are still keener to pursue property given the chance of improving its value (41%) and being able to help future generations (who may face an even tougher economic climate) by passing it on (37%).
Both reasons which were far less of a concern for baby boomers – despite growing trends in family members having to financially support younger generations today.
Even with affordability concerns, the tenacity of millennial first-time buyers today is undeniable.
Among millennials, 45% said they only wished they had been in a position to buy sooner, if they could turn back time to when they were younger and had a bit more readily available cash for investments.
Alan Davison, director of customer sales at Together, said: “Over the last 50 years, in supporting the homeownership and commercial property ambitions of the UK; we’ve seen our fair share of ups and downs in the market.
“While less volatile, first-time buyers in the early 1970s faced high prices before a dramatic drop in the economy took hold in 1974.
“And so, it is encouraging that, while affordability remains a concern, there continues to be a healthy appetite for homeownership.”
He added: “Our research proves young people’s unrelenting desire to open doors to new properties, whether that’s to create family memories or develop exciting new projects for wider public use.
“Prices may be high, and many first-time buyers will be hopeful for some inflationary and interest rate relief this year.
“However, millennials are continuing to see value in property ownership not only an investment vehicle, but also as a part of their future succession plans, which sheds a positive light on the property market moving forward.”