With rising house prices and an overheated market showing no signs of cooling, it looks like young Brits are thinking outside the box and looking elsewhere to purchase homes.
Here’s how some people plan to buy more reasonably priced homes and why we could soon see a mass exodus from the UK housing scene. I’ll also share some tips for finding yourself a home that you can afford.
Why are UK house prices so high?
Rising house prices were a symptom of the coronavirus pandemic that no one was really expecting. However, during lockdowns, a ‘race for space’ ensued, with people looking to move to larger properties away from the urban sprawl. On top of this, there was also the Stamp Duty holiday and the fact that many people built their savings while restrictions were in place.
All of this combined with historically low interest rates (making it cheap to access a mortgage), created a perfect storm for a boiling hot housing market. With lots of demand and a limited supply of homes, prices have been creeping higher and higher.
This is making homes even less affordable for young people on relatively low wages. Rising rents are also making it increasingly difficult for some to build up savings and put together a deposit. So it’s no surprise that many people in this situation are starting to look at alternative routes to homeownership.
How are younger Brits responding to high UK house prices?
In order to avoid the highly inflated UK house market, some young Brits are looking to buy property abroad instead.
Research from home and contents insurer Urban Jungle shows some interesting stats about people in the 18-35 age bracket. According to their survey:
- 25% are considering moving abroad to make owning a home more realistic.
- 80% are actively saving for a deposit, but a third of those believe they won’t be able to meet their target.
- 84% who’ve managed to get on the property ladder have been surprised by the hidden costs of buying a home.
Why would moving abroad be a good option?
Not only does the younger generation have to deal with high house prices in the UK but there’s also inflation and the rising cost of living to worry about. In most cases, wage growth has not nearly been fast enough to keep pace with other costs.
One positive outcome of the pandemic is the rise in remote working. Working remotely using the internet opens up a lot more possibilities for first-time buyers. Buying a house abroad can be more affordable, and some countries also have much more reasonable living costs.
No longer will workers be forced to live in expensive commuter towns or near city offices. Some can now look for cheaper living arrangements, whether that’s within the UK or abroad. If you don’t like the idea of an international move, check out our article explaining some helpful things you need to know about buying a home in the current climate.
Where can you find help to deal with high house prices?
If the rising cost of owning a home is becoming a real barrier, don’t panic. We’ve got some excellent resources to help you. If you’re struggling to get a deposit together, here are three ways to get help.
It’s also worth making sure you’re completely clued up on mortgages. Check out this straightforward guide for accessing the best mortgage deals in the UK.
Whatever your situation, there will be ways that you can make the dream of homeownership more realistic. But it may involve a lot of hard work and research. So don’t be put off it takes some time.
The post Here’s how young Brits are planning to avoid high UK house prices appeared first on The Motley Fool UK.
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