Concerns are rising about the availability and quality of homes as the housing crisis deepens.
According to the 2016 Homeowner Survey by the HomeOwners Alliance and BLP Insurance, 78% of aspiring homeowners are worried about the availability and quality of homes, up 6% from last year.
The survey, which polled over 2,000 UK adults, revealed that the number of people that aspire to own their home has risen to almost three quarters (73%), up from 65% four years ago.
House prices, getting on the property ladder and saving for a deposit continue to top the list of housing concerns.
The survey revealed that the ability for first-time buyers to get on the housing ladder and saving for a deposit are a serious problem for 82% and 80% of UK adults respectively.
Meanwhile, the proportion of aspiring homeowners who say that the availability of housing is a serious problem has risen from 72% last year to 78%.
The quality of housing is also viewed as a serious problem by 60% of aspiring homeowners.
Paula Higgins, the chief executive of the HomeOwners Alliance, said: “Despite a blizzard of government initiatives aimed at helping homeowners, the housing crisis is deepening across the country, with ever more non-homeowners wanting their own home, and ever greater concern about the lack of housing.
“Many government policies have boosted demand for homes, but what this survey shows is that the real problem is the desperate shortage of houses. Until the government tackles the fundamental issue that we just don’t have enough good quality homes, the housing crisis will continue to deepen and a generation will continue to have their dreams of homeownership crushed.”
There are fears that first-time buyers are being squeezed out of the market due to the dwindling supply of suitable homes and ballooning property prices.
According to the latest Nationwide House Price Index, house prices rose 0.2% during April to £202,436.
Last year, 142,890 homes were completed, a 21% increase on the previous 12 months. However, this number still falls well short of the government target of 200,000 new homes annually.
Tougher affordability checks from lenders and rising house prices have also made it increasingly difficult for first-time buyers with smaller deposits to get on the property ladder.
Low interest rates combined with the economic recovery have done little to reduce the need for rented housing, while house price inflation ahead of wage growth has pushed property prices out of reach for many.
Kim Vernau, chief executive of BLP Insurance, said: “We are now at a critical juncture for the construction industry and housing market. The government urgently needs to speed up the delivery of new homes for aspiring first time buyers. Tenures of all types are required across the country and affordable housing and social housing should also be a priority.
“Balancing these competing demands is a challenging task, particularly given the shortage of labour skills that we are currently witnessing in the construction industry. This is likely to get worse in the absence of key initiatives to help address this critical issue and the new Housing and Planning Bill and threat of a potential Brexit could tilt the construction labour market even further off balance.”
Government schemes
The government has introduced a number of new schemes in recent years to help those looking to buy a home.
Help to Buy ISAs, introduced in December, give first-time buyers saving for a deposit the opportunity to put away £200 a month in a dedicated ISA that the government will top up by 25%, up to a maximum of £3,000.
The Lifetime ISA will allow anyone younger than 40 to put away up to £4,000 a year until they are 50. For every £4 people save, the government will give them back £1, a bonus of up to £1,000 a year.
It will be launched in April next year and those with a Help to Buy Isa will be able to transfer their funds into it. Alternatively, you can continue saving in both, but you will only be able to use the bonus from one to buy a house. The Help to Buy ISA is due to end in 2019.
The savings and the bonus can be used towards a deposit on a first home worth up to £450,000. Accounts are limited to one per person, so two first-time buyers can both pair up and double their bonus.
With the Help to Buy equity loan scheme you can borrow up to 20% of the purchase price of a new-build home. The loan comes from the government and is repaid when the property is sold. The rest of the payment is made up with a deposit of at least 5% and a mortgage of up to 75%.
Help to Buy London was launched on 1 February and gives aspiring homeowners who have been frozen out of the market in London the opportunity to get on the housing ladder. First-time buyers with a 5% deposit can borrow up to 40% of the value on a new home priced up to £600,000. They will need a mortgage of 55% to cover the rest.
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