The Office for National Statistics (ONS) has published insights into major life milestones around homeownership and retirement.
It showed that young people are leaving the family home later, while people are retiring later, with a bigger increase in the average retirement age for women — from 61 years in 2011, to 66 years in 2021.
The proportion of people who own their own home also decreased since 2004.
In 2022, more than half of people owned their own home – either with a mortgage or outright – by age 36 years, up from 32 years in 2004.
The long-term trend showed an increase in the age that more than half of people own their home, although the short-term changes are less clear.
Newspage asked property, mortgage experts and IFAs for their views, below.
Reaction:
Andrew Montlake, managing director at Coreco:
“This research shows the consequences of a wounded housing market allowed to bleed out over many years.
“Without a long-term plan that puts housing at the very heart of Government policy, rather than short-term demand-sided policies that only line the pockets of builders, prices will continue to be out of reach for many.
“This forces people to buy later, work longer and take on longer mortgages.
“A fresh approach to housing is needed, one that takes into account the inter-dependence of private ownership, the private rental sector (PRS) and social housing, to deliver what is needed for the next generation.
“Not only that, getting it right is vital for the health of the economy and society as a whole.”
Amit Patel, adviser at Trinity Finance:
“House price inflation, a lack of ‘truly affordable’ new build housing and affordability issues mean that borrowers now have no real choice but to take out longer term mortgages.
“It’s hard to see this improving until there is a housing overhaul.”
Gary Bush, financial adviser at MortgageShop.com:
“A disastrous set of figures released by the ONS on these key milestones, but are they really a surprise?
“The readthrough seems to be first-time buyers are renting for longer now rather than buying their first home in their twenties, obviously based upon deposit levels required and the income-to-mortgage gap increasing annually.
“It’s encouraging to see that a greater percentage of homeowners in their early 60’s have now repaid their mortgages – however, it’s clear that this could be the last time that this stat appears due to house price inflation that is showing no signs of calming over the long term.
“With the law on employers not being in a position to force workers retirements due to their age, over a decade ago, the numbers are now showing that people’s retirement is being delayed more and more obviously due to economic pressures in the UK.
“Looking at the horizon I can only see the average retirement age being delayed into peoples 70’s in the future.”
Justin Moy, managing director at EHF Mortgages:
“Financing ‘later for longer’ is not something any borrower would want to sign up for, but there is little choice for first-time buyers.
“Parents looking to use downsizing as a viable exit from the four-bed home to the two-bedroom by the coast will need to keep the family home longer, to keep a roof over their 20-somethings heads.
“This reduces the supply of family homes to the market, pushing prices even higher and more out of reach of everyone.
“When you sprinkle higher rates on top, it doesn’t make home ownership any sweeter.”
Elliott Culley, director at Switch Mortgage Finance:
“It’s no surprise to see first-time buyers becoming older, people working longer and mortgages being paid off later.
“These are all consequences of higher house prices, meaning it’s harder to get onto the housing ladder.
“Many first-time buyers initially take longer terms to keep payments affordable and with current rates we are seeing many mortgage holders employing the same tactic to keep their heads above water.
“The figures revealed today will only worsen over the years to come.”
Michelle Lawson, director at Lawson Financial:
“These stats are unsurprising. Getting on the housing ladder is harder for first-time buyers as they are saving for longer.
“Most also have to wait to buy with a partner, which helps bolster affordability and the property they can buy.
“People are unintentionally forced to take mortgages for longer due to affordability, house prices and interest rates. This is the new ‘normal’.”
Robert Timm, managing director at Sunland Mortgages:
“The fact people are leaving their family home later and later is no great surprise.
“Rents are significantly higher in proportion these days compared to in 2011, and young people are savvy, they realise they can live at home, rent-free, and start to save a deposit.
“Given the current interest rates, and more and more people taking their mortgage terms over 35 or even 40 years, it’s conceivable that the age by which people will eventually pay off their mortgage will increase significantly to beyond 65, maybe close to 70.”
Harps Garcha, director at Brooklyns Financial:
“Road to owning a home is riddled with hurdles, especially for first-time buyers.
“The main culprit? Affordability, or rather, the lack of it.
“Housing prices are skyrocketing while salaries struggle to keep pace.
“Saving for a deposit feels like chasing a moving target, particularly when rent consumes a large chunk of the monthly salary.
“Once on the property ladder steep mortgage balances and high mortgage rates, mean retirement plans are delayed as mortgage payments take precedence over savings.”
Scott Taylor-Barr, principal adviser at Barnsdale Financial Management:
“All these figures are no surprise and are the consequence of the decisions taken by UK plc over the previous decades; extending retirement ages is due to people living longer (which is no bad thing), but some would argue that we haven’t extended retirement ages far enough to keep pace with the average age of mortality.
“People having to wait longer to get on the property ladder and then maintain that mortgage for longer is a direct result of the lack of sufficient new property being built, pushing prices up way above the rate of average inflation and, more importantly, above the rate of wage growth.
“If the desire is to allow more people to buy earlier in their lifetime and not have to maintain mortgages so far into their later years, then the Government need a bold and visionary housing policy to deliver more of the right type of property, in the right areas, to bring down overall values; it would win votes with younger people, but would likely lose the vote of older voters.”
Ben Perks, managing director at Orchard Financial Advisers:
“Anyone who has scrolled through Rightmove will know that house prices have shot up significantly since 2004.
“So, it is no surprise that first-time buyers are older, are borrowing more for longer and are having to work later in life to clear the debt.
“This is an issue that isn’t going away any time soon. The availability of housing is a key contributor here and government intervention is required.
“They can’t keep burying their head in the sand: they haven’t hit their house build target once in the past 20 years.”
Ken James, director at Contractor Mortgage Services:
“Shock horror, you mean to say my kids will stay at home for longer and my mortgage will continue to have to paid until I am older, you would have had to have been asleep for the last few years for this to have come as a suprise.
“With the increase in the cost of living and the rises in mortgage rates, the ability to overpay on mortgages has decreased, many now opting to increase the term of the mortgage helping them make the lending more affordable.
“Children who venture into university for degrees have found that the cost of education has increased and with student loans hanging around their necks this will have an impact of potential future lending amounts, we are living in a world where everything we buy costs more and we have less money with which to buy it, we should expect these figures to get worse not better unless their is a seismic shift in the economy and we start to see a reduction in costs and rates.”
