For many people, buying and owning their own property is a key aspiration, but unfortunately, for the younger generation, the dream of property ownership is either out of reach, or far more costly than what it was for their parents or grandparents, also known as the baby boomers (people aged 50-70).
New research has found that because of falling home ownership among younger people, and the rising cost of renting a property, millennials (those younger than 35 years old) are now paying around £44,000 more on rent before they turn 30, compared to the baby boomer generation who benefited from inflation-beating pay rises, cheaper property prices and lower property price increases.
The research also found that by the time they’re 30, millennials are also paying around £25,000 more on rent compared to the generation who directly preceded them, also known as Generation X. The research showed that nearly 60% of Generation Xers managed to make it on to the property ladder by the time they reached 30, compared to just 42% of millennials. The figures also revealed that nearly 63% of baby boomers managed to afford their own home before they were 30.
The Resolution Foundation has said that the figures are very worrying and that younger generations are suffering because of decades of falling housebuilding and rising house prices. The Foundation continued to say that the living standards for young people are far worse than that of their parents and grandparents because they’re being forced to rent properties for longer at a time when renting costs are skyrocketing; they are therefore unable to save the money needed to put down as a deposit on a home of their own. According to the Foundation, a first-time buyer today needs approximately £33,000 as a deposit, which is eclipsed by the extra £44,000 millennials now need to spend on rent just to keep a roof over their head.
The Foundation has stressed that the country’s failure to build new homes means the problem of rising house prices and subsequent renting costs will only get worse, not better, and it’s not baby boomers who will suffer. The younger generation will continue to suffer the most as house prices rise and rental costs continue to spiral upwards.
The Foundation has stressed that it will now launch an 18-month investigation into the living standards of young people, and will recommend policies that the government should implement to improve the living standards of future generations.
Are you looking to buy your first property in Cardiff? If so, as Cardiff’s largest estate agent, we have the knowledge to help first-time buyers find their dream home for the best price in many beautiful areas across the Welsh capital. For help and assistance, please get in touch with the team of property experts here at CPS Homes today on 02920 668585, email email@example.com or pop into one of our Cardiff branches in Cathays, Cardiff Bay or Roath.