'Most young workers lack savings to buy a first home'
Four in five non-homeowning 23 to 34-year-olds lack the savings and earnings they need to buy an average priced first-time buyer home in their region, according to new research by the Resolution Foundation.
The left-leaning think tank's report also found that saving 5% of gross earnings for five years would only allow 11% of young non-home owners to buy the average priced first-time home in their area.
Since its peak of 51% in 1989, youth home ownership has fallen to 25% in 2016, rising slightly to 28% in 2019.
Only 4% of young non-home owners have the savings to buy an average-priced first-time home, the report said.
However, home ownership can still be achieved by "settling for a cheaper property" or combining savings with a partner, while 34% of young first-time buyers relied on loans and gifts from family and friends to buy over the last three years.
Adam Corlett, principal economist at the Resolution Foundation, said:
"Too many young people are having to rely on windfalls from others, or pooling resources with a partner, to get closer to owning.
"These options simply aren't available for everyone, and more needs to be done to deliver on the promise to turn generation rent into generation buy."
The Government has made support available to first-time buyers through equity loans, while the first homes scheme will build 1,500 homes across the country to be sold at 70% of the market value to local first-time buyers and key workers.
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