Kidults struggle to secure first mortgage

While the credit crunch might have helped first-time buyers by dragging down house prices, an inability to finance a property purchase means young people are still struggling to climb onto the first rung of the property ladder.

Such are the problems associated with buying a house for the first time that Abbey Mortgages has come up with a new term to describe people who are putting their plans on hold and living rent-free with friends or family.

According to the low interest mortgages provider, there are currently over 1.6 million 'Kidults' in the UK aged between 18 and 34.

Most of these are southern-based, a phenomenon which has been attributed to the above-average house prices in London and surrounding areas.

However, the issue is not unique to people of younger generations, as 300,000 35- to 54-year-olds are also in the same situation.

This means there are close to two million adults in the UK living rent-free as they can not afford to buy their own home, and the extent to which the situation has worsened recently is illustrated by the fact that the equivalent figure for last year was less than 500,000.

While this state of affairs is hardly ideal - particularly not for those in the older age bracket - Abbey Mortgage director Nici Audhlam-Gardiner believes it may hold some advantages, particularly over people who are renting while simultaneously saving up to buy their first home.

"In the current climate many people have little choice but to return home or turn to their friends or family for somewhere to live at no cost. Whilst an adult living at home until their 30s is more associated with our continental cousins, Abbey Mortgages research shows that this is a trend that is on the increase here in the UK as well," she commented.

"With larger house deposits required to get the better mortgage rates, living rent free is a great opportunity for potential first-time buyers to save money that can be put towards a deposit for a property of their own."

Kidults can expect to save a collective £839 million more than people who have to pay rent, with the average rent currently standing at around £441.78 a month.

Once they have saved up for a deposit, Kidults hoping to flee the nest and buy a home of their own would do well to take time to scour the mortgage market to assess which product would be best for them, with low interest mortgages a good starting point.