More than one in five Gen Z homebuyers would move at least 25 miles away from their preferred location in order to afford a property, according to the latest Barclays Property Insights research.
The study highlights the growing compromises younger buyers are making to get onto the housing ladder, with affordability continuing to outweigh location as the most important factor when purchasing a home. Among Gen Z respondents aged 18 to 29, property price was cited as the top priority when buying a home, ahead of location and neighbourhood quality.
A quarter of Gen Z renters said they cannot afford to buy in their preferred area, while 21% of those who prioritise affordability said they would be willing to move more than 25 miles away to secure a property within budget.
The research also found that 14% of Gen Z adults have already lowered their expectations or reduced their budget due to affordability pressures.
RESILIENT DEMAND
Despite these challenges, demand from younger buyers remains resilient. Barclays found that 16% of Gen Z renters are actively searching for a property to buy, an increase of 9% compared with the previous month.
There was some encouragement for buyers in the latest mortgage data, which showed average deposit requirements fell by 16.4% year-on-year to £57,209. London recorded one of the sharpest declines, with the average deposit falling by 27.2% to £136,057, while significant reductions were also recorded across the South East and East Anglia.
However, the research suggests that affordability is only one challenge facing home movers. Almost nine in ten buyers and sellers who completed a transaction this year reported experiencing delays, while 29% said a purchase had fallen through altogether.
Conveyancing issues, estate agent delays and difficulties finding suitable properties were among the most common causes of hold-ups.
TIME TO COMPLETION
Barclays mortgage data also showed that the average time between a final mortgage offer and completion increased by 21.7% year-on-year, highlighting ongoing inefficiencies within the homebuying process.
Jatin Patel (main picture, inset), Head of Mortgages, Savings and Insurance at Barclays, says: “Adaptability has become the hallmark of the modern buyer. First-timers remain constrained by affordability, but will be flexible to achieve their goals, making trade-offs on location or property features to get on the ladder.
“Meanwhile, existing homeowners are acting more decisively, with many locking in rates earlier, or shifting their plans in response to volatility. Together, these trends may make for a more complex housing landscape, but reflect a clear determination among consumers to take control of their financial future.”
AFFORDABILITY HURDLE
The research also found that more than two-fifths (42%) of mortgage holders are now more likely to secure a remortgage deal earlier, while remortgaging accounted for 40.6% of Barclays mortgage completions in May, up from 30.7% a year earlier.
Julien Lafargue, Chief Market Strategist at Barclays, said: “The expected reopening of the Strait of Hormuz and the associated drop in oil prices mean that inflationary pressures may be more contained than feared in the coming months.
“This should give the Bank of England some breathing room, allowing the central bank to keep interest rates unchanged for the time being.
“Although any renewed political uncertainty could represent a headwind in the short-term, the picture appears to be gradually improving for the UK real estate market.”
