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First-time buyers favour lifetime mortgages

Tuesday, 5 December 2006 12:00 AM

First-time buyers are so keen to get onto the property ladder almost half would take on a 50-year mortgage rather than take a loan from their family or buy with a friend.

That is according to a new survey of prospective first-time buyers by property portal HotProperty.co.uk.

This means first-time buyers, who are on average aged around 30, would still not own their home until they hit their 80s.

The report also shows one in three prospective first-time buyers see buying a property as a way of funding their retirement, in contrast to their willingness to take on a lifetime mortgage.

"Fifty year mortgages are already popular in countries like Japan, and with the UK's property prices very high and continuing to rise, it is not surprising that so many British first-time buyers are interested in assuming these types of mortgage," said Shawn Luetchens, HotProperty's managing director.

"Vast numbers of first-time buyers, perhaps perplexed and frustrated by the current state of the property market, are burying their heads in the sand and not thinking their property and pension strategies through adequately," he warned.

First-time buyers are mostly optimistic about their chances of making it onto the property ladder, however - just over half believe the market is overpriced and property prices will drop.

However, once on the ladder first-time buyers are not so optimistic, with nearly six in ten worrying about a house price crash.

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