Research by the Council of Mortgage Lenders has found that flexible mortgages could help reverse the falling numbers of young homeowners. The biggest falls hit the youngest age groups.
In 2002, 23% of privately owned households were owned by 20 - 24year olds, compared with 38% ten years earlier. The figures for the next two age groups, 25 - 29 year olds, and 30 - 34 year olds were not much better.
After stabilising in the mid 1990's, numbers fell again after 2000. Among the reasons given for the drop in numbers of young buyers, was student debt.
Our view
In this age of debt, we do not see how flexible mortgages will encourage lenders to offer money to a person who has thousands of pounds in debt and is struggling to repay it. We know the average student finishes their studies with over £10,000 in debt.
The facts remain,
a) if a student secured a job whilst studying the debt would be kept down and
b) if a graduate actually took paying the debt of seriously after their studies, even £10,000 could be cleared in less than 3 years given the low interest rates charged.
The bottom line is that many do not take responsibility for their actions whilst studying or indeed soon after and leave with a considerable burden.