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What is the biggest barrier to homeownership?

Journalist: Jake Carter, Mortgage Introducer

ended 25. September 2023

People consider the high cost of a mortgage is the biggest obstacle to buying a property today, latest research from the Building Societies Association (BSA) has shown.

What do you believe is the biggest barrier? 

How can this obstacle be overcome?

What advise do you give customers looking to purchase their first house with a limited budget?

8 responses from the Newspage community

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Darryl Dhoffer
Founder at The Mortgage Geezer
Biggest barrier this year for home ownership for many consumers has been the uncertainty on mortgage rates and costs involved, along with areas of the country that have seen reductions in house prices. Buyers need consistency in mortgage rates and house prices and this year has been far from consistent. Hopefully, with the halt on Bank Of England base rate hikes, and the reintroduction of more attractive mortgage pricing from lenders, combined with a stabilising of house valuations, will we then see consumer confidence return.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
There are 3 main barriers to home ownership. Firstly the size of the deposit needed, which without help from the Bank of Mum and Dad, is difficult to save up, especially if living in rented accommodation. The second hurdle is affordability, which, following the increased rates and costs of living, many lenders have reduced how much they will lend, and the cost of borrowing is now much higher than it has been in the last 10+ years.
The final hurdle, which is probably the root cause is the uncontrolled upward spiralling of house prices, with the average house price now 10x the average salary, many would-be home-buyers are simply priced out of the market.
There are some lower-deposit options such as shared ownership and affordability could be boosted by a family member through certain schemes but sadly there is no quick fix for the underlying problem of house prices.
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Ross Lacey
Director & Independent Financial Adviser at Fairview Financial Management
Meeting lenders' affordability requirements and criteria is one barrier, but so is saving a sufficient deposit. We specialise in first-time buyers and the majority have a deposit that has, partially at least, either come from an inheritance or a gift from parents.
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Kylie-Ann Gatecliffe
Director at KAG Financial
We see the biggest barrier currently being affordability - as interest rates have risen, how much a client can lend has tightened. This combined with house prices still being high has made it tough for clients to get a property that ticks all the boxes. We have seen more people having to relocate, downsize or go for a different property type to make affordability work. Hopefully now fixed rates are starting to reduce affordability will improve and buyers won't be having to make as many tricky compromises.
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Graham Cox
Director at Bridging Hub
The biggest barrier to home ownership is the cost of buying one. It really is that simple. Property prices have surged ahead of average earnings for decades, making them increasingly unaffordable. Not just making the mortgage payment too expensive, but pushing the minimum deposit size out of reach as well.

The solutions are straightforward, they just need the political will to execute them. Build far more houses, especially social housing, whilst putting in place other measures to prevent further runaway house price inflation.

For example, include property prices in the 2% inflation target. Speed up planning, clamp down on Nimbyism, and aggressively tax property speculation and second home ownership.
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Austyn Johnson
Founder at Mortgages For Actors
Affordability. Its just so hard to afford the home you want without settling for a lesser property.
That added with the extremely tight criteria on low deposit mortgages, its difficult for FTB's, especially so in london.
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James Bull
Mortgage Broker at JB Mortgages
I agree that high-interest rates are certainly putting many people off buying a property. This is reflected in the large drop in purchase activity throughout 2023. I am hoping for interest rates to drop from October onwards which should make mortgages more affordable and tempt clients back into the market.
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Steven Hargreaves
Mortgage and Protection Adviser at The Mortgage Co
There are several barriers to home ownership, one factor is the monthly repayments from the increases in interest rates in the last 12 months, however, whether you are paying a mortgage or rent the costs are similar. Lenders reducing affordability and changing criteria have been a factor, especially when lenders can see rents of a similar amount to the new mortgage going out each month, so clients are showing they can afford the repayments.
You also have the press indicating property prices will be falling in the next 12 months, which does not instil confidence in buyers, thinking if they buy a property this year, by the same time next year it may be worth 5 or 10% less.
It would be nice to see some stability, both with the interest rates, and lenders' criteria, which would hopefully avoid the boom and bust housing market we have seen in the last 3 years, this will provide confidence.