Is It Time to Fly the Nest?

Based on the analysis of data from the Office of National Statistics from 2016, Aviva suggests that an additional half a million young adults in the UK may still be living with their parents over the next 10 years. This follows a 37% increase over the last decade of people aged between 25 and 34 who are still living their parents, taking the current number up to around 1.23 million. Based on the latest projections, the UK could have an extra 452,000 adults within that age group remaining in the family home by 2027.

This trend coincides with an average 45% increase in UK house prices for first time buyers, with the average price paid for a property rising to £211,000. Reportedly, findings from a separate surveyconducted by Aviva show that 62% of the 500 participants cannot afford to move out of the family home to rent or buy a property. However, 47% of the did say the were “very happy” with their current living arrangement with their parents, with 24% saying they enjoy being “looked after”.

Is there a solution?

Raising a deposit to buy a property is one of the biggest challenges faced by would-be first-time buyer, with many adults having to resort to borrowing a sizeable sum from their parents. For those who do not have the option of financial assistance from family, the Help to Buy equity loan scheme introduced by the Government can provide certain first-time buyers with a 5% deposit and 20% interest-free loan over five years.

You may be able to purchase with parents on a joint mortgage, sole owner basis, where parents’ income is taken into account in order to generate a bigger mortgage but they are not on the property deeds so you avoid paying higher stamp duty.

It’s also worth expanding your search area for properties to and explore more affordable areas. It is well known areas in the West of Scotland where Caledonia Bureau is active are a lot more affordable than Glasgow, while still in commuting distance. This may result in a longer comment to and from work and being further away from friends and family, but it could enable first-time buyers to get their foot on the ladder. As a long-term strategy, it’s a worthwhile consideration.

A final option would be to share a mortgage with a friend, partner of family member who finds themselves in the same position or who is willing to accommodate such a set-up. There are a number of lenders who offer this type of mortgage product, so it could be a real possibility.

The best course of action for anyone hoping to buy their first property, whether on their own, as a joint applicant, or with assistance from family, friends or the Government’s Help to Buy scheme, is to make an appointment with an independent professional advisor for impartial advice. It’s an incredibly complex area; therefore, professional advice is paramount.

As one of the West of Scotland’s longest-standing estate agents, we have had lots of experience managing the ups and downs of the housing market in recent times, so you can be confident you’ll be in safe hands when working with us. With an expert team by your side and a variety of properties on offer, including both property to let and homes for sale, Caledonia Bureau are confident that we can match you with the right home. Give our friendly team a call today, choosing from our offices in Clydebank, Helensburgh, Dumbarton and Paisley.

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