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ONS report - home ownership and finances

ended 13. October 2021

An ONS report published this morning has found that:

  • The proportion of renters who expect to eventually buy their own home has declined further this year.
  • One in ten households  said they were behind with at least one household bill in April-May 2021, while more than one in five had recently used their savings to pay their rent or mortgage.
  • In April-May 2021, 22% of households had recently used their savings to pay their rent or mortgage.

Newspage sought the views of mortgage and financial experts:

8 responses from the Newspage community

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Premium
Daniel Wiltshire
Actuary & IFA at Wiltshire Wealth
"These findings are concerning enough, but with inflation forecast to rise above 4% by the end of the year and the cost of borrowing also expected to increase, household finances are set to be squeezed even further. There are sadly tough times ahead."
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Robert Payne
Director at Langley House Mortgages
"These are concerning statistics that show an unsustainable pattern of financial behaviour amongst some. If these trends carry on then we are heading towards a large number of defaults, which is bad news for everyone. It is unclear why this is happening but if it is linked to the impact of Covid-19 then we are potentially only witnessing the tip of the iceberg, with extremely worrying times ahead of us."
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Platinum
Kate Allen
Owner at Finest Stays
"For the first time in my lifetime, I’m feeling anxious about UK PLC and the rising costs of living (amongst many other nerve-wracking issues bubbling away). Plans to buy a family home have been scuppered by the vast increases in property prices along with reduced stock. Am I forever to be trapped in this pink-walled, red-carpeted, pine-doored 70’s rental?"
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Platinum
Scott Gallacher
Director at Rowley Turton
"I find it depressing that the dream of homeownership may remain just a dream for too many people. This is due to a combination of factors but fundamentally we don't build enough houses in the UK. The government needs to commit serious money to build hundreds of thousands of family homes for ordinary people, especially more council houses. It can't simply rely on the private sector, which naturally favours building more profitable 4 or 5 bed detached houses, to do this."
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Rhys Schofield
Brand Director at Peak Mortgages and Protection
"Renters are in a real Catch-22. Most people paying market rents could comfortably afford mortgage payments if they bought given rock bottom interest rates but many have no real prospect of saving the minimum 5% deposit generally needed to buy with all their wages being spent on rent. We need some joined-up thinking as an industry because the reality is that, with no real social housing safety net, if these people don't buy we are condemning them to a retirement of poverty where they will not be able to afford market rents on a pension income. "There are 0% deposit schemes out there but they tend to rely on the bank of mum and dad getting involved in some way but that is not possible for many would-be buyers."
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
"I'm not at all surprised that more renters now feel that owning a home is even more of a distant dream than ever. However, the situation, at least beyond the extremes in areas of the south of England, is not as bad as many think. A lot of the data we see reported, such as average house prices, bears no reality on the situation of buying a house in Telford or Leicester, for example. The data is a UK average, so is not actually the cost many will be buying at and certainly not as first-time buyers. "Given the scale of the issues faced by many sectors, without wanting to take away from the stress that being behind on bills causes to those in the situation, I'm actually a little surprised it's not more than 10%. I can only imagine that a combination of the furlough scheme and people's own savings have been the reason for such a comparatively low figure."
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Paul Neal
Mortgages & Equity Release Advisor at First Choice Financial Services
With Covid, furlough ending, rising fuel and energy prices it's no wonder people are beginning to struggle. You then have to wonder at what point do they manage to start putting money away towards a deposit for their home? With the average property price around £250,000, a minimum deposit would be £12,500 and if you have fallen behind with your bills, there is little point in even looking at this as you will struggle to be accepted by many lenders. Then we wonder why generation rent cannot afford to buy."
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Joshua Gerstler
Chartered Financial Planner at The Orchard Practice
"For far too long the government has implemented policies which they think help people to buy a home when in fact what actually happens is they artificially inflate house prices and make it harder for renters to buy their first home."