Renters and residents are losing faith in homeownership, according to a new study which reveals that six in 10 non-homeowners believe they’ll never get onto the property ladder.
Residents blame the current housing market and economic climate for this, stating that it has made homeownership unattainable. In the new research by Go.Compare Home Insurance, more than half (52%) of non-homeowners stated that this was why they felt owning a home was no longer important.
Despite some having doubts about whether they’ll ever buy their own property, most still aspire to putting down roots. More than three-quarters (76%) of the non-homeowners surveyed said they feel home ownership is still important, compared to the rest who didn’t feel it was.
The average salary for a single person to buy a house in the UK is £59,307, according to the insurance comparison site’s salary checker tool.² However, analysis of ONS data on average salaries nationwide found that, shockingly, no industry listed provides an average wage high enough to meet this.³ Based on these figures, it’s unsurprising that 60% of non-homeowners feel they won’t ever be able to buy a house.¹
Renters pointed to various reasons as to why they feel that homeownership is no longer important. Many feel that homeownership is too big of a commitment (30%) and renting is an easier option (28%), offering them better value for money (17%). Some felt they had more important things to save for or spend money on (22%) or were concerned that they could lose a lot of money in the long run by buying a home due to changes in house prices (14%).
Nathan Blackler, home insurance expert at Go.Compare, said, “It’s disheartening to find that the majority of renters and residents who don’t yet own a home don’t believe they ever will due to the current economic climate and the shape of the housing market. Despite this, it’s still a goal that most want to achieve, which is why more needs to be done about the issue.
“Our research has shown that it’s simply unattainable for the average worker to be able to afford, and many non-homeowners believe that the government needs to step in to help first-time buyers get on the property ladder. Whether that is achieved through subsidised house prices, stamp duty relief, or improved government schemes such as help-to-buy ISAs, shared ownership or 99% mortgages.”
More information on residents’ opinions about homeownership can be found on Go.Compare’s website.
¹ In order to collect the data used in this report, a survey of 2,000 UK residents was conducted via YouGov. The survey was run on 03 July 2024, and all responses were randomly selected. The results have been weighted to represent Great Britain’s population.
² House prices were taken from HM Land Registry UK House Price Index: June 2024. Monthly repayments were calculated based on the 90% mortgage with a 5.5% interest rate over 25 years. Retrieved: September 2024.
The average salary needed to buy (£59,307) was calculated assuming that monthly mortgage repayments would take up one-third of your take-home income and applied to the average UK house price across all property types (£298,076).
³ Salaries by industry were sourced from the ONS dataset: 2023 estimates of paid hours worked and earnings for UK employees by sex, full-time and part-time, region, and two-digit Standard Industrial Classification 2007.