"Seeing mortgage payments shoot up for millions of people because of how traditional mortgages work will of course put off many would be homebuyers."
- Arjan Verbeek, CEO and co-founder of Perenna
The experience of securing a mortgage is deterring two in five aspiring first-time buyers (42%) from pursuing homeownership, new research from Perenna reveals.
Nearly two-thirds of first-time buyers (62%) have faced difficulties securing a large enough mortgage to buy, making the dream of homeownership feel unattainable for many. London is hit hardest with 65% of first-time buyers affected and where property prices are 34% higher than the average property price in the UK.
Income-related difficulties are also prevalent, with 68% of first-time buyers experiencing challenges securing a mortgage due to their income level.
The affordability crisis is also forcing many first-time buyers to make major life milestone sacrifices to save up for a large enough deposit. Half are delaying major life events such as marriage, starting a family, or changing their job to fulfil their dream of homeownership.
Nearly three-quarters (72%) agreed that long-term fixed rates would give them confidence in stepping onto the homeownership ladder.
40% said that mortgage lenders need to better support first-time buyers by allowing greater borrowing power and nearly half agreed (48%) that if there was a mortgage that allowed them to borrow more to buy, they would find this attractive to consider.
Arjan Verbeek, CEO and co-founder of Perenna, said: “It’s a travesty younger people are put off from one of the most rewarding experiences in life, becoming a homeowner. Seeing mortgage payments shoot up for millions of people because of how traditional mortgages work will of course put off many would be homebuyers. We need to change this trajectory urgently.
"We believe everyone deserves a chance to own their home and enjoy living in it without worry. Longer-term fixed-rate mortgages are part of this solution, providing greater borrowing power, and stability through payments that don’t shoot up, a far cry from the way traditional high street mortgages work. Perenna’s goal is to make homeownership a reality for first-time buyers and make us a nation of happy homeowners.”
