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11:02am Saturday 28th June 2014 in News
PAYING off your mortgage before you reach 60 has become merely a distant dream for many homeowners according to new Equifax research by YouGov.
Online credit information provider Equifax assessed the outlook of current homeowners who have a mortgage, finding that over a third (36 percent) expected to be older than they had originally planned by the time they pay off their mortgage.
Most (23 percent) expected to be between 61-65 years old when they were finally mortgage free.
One in ten (11 percent) expect to be between 66 and 70 before completing mortgage payments.
The latest research also provides a snapshot of the sacrifices people will make in order to secure their ‘dream’ home as the impact of new mortgage affordability rules sinks in.
Although recent focus has been on first time buyers, those looking to buy their second or third home will also face strict affordability tests before they can move on.
Among those second and third time home movers, a quarter (26 percent) would be willing to take on the stress of a new job with a higher wage to secure the finance for their dream home. And almost a quarter (23 percent) said they would borrow the maximum amount available to them.
One in three (31 percent) homeowners surveyed said they would be prepared to cut back on general living expenses for at least six months, and 49 percent were willing to tighten the purse strings over luxury living expenses to buy a home.
Over half (56 percent) would reduce the amount of time spent with friends and socialising, and just over half (53 percent) would also cut back on retail therapy for at least six months to be able to afford a new mortgage.
Andrew Webb, sales and marketing director of Equifax Personal Solutions said: “With new housing stock limited, it is vital for homeowners to continue to move up the property ladder in order to free up smaller homes for first time buyers.
“But they must be in a strong financial position to do so. The fact that, according to the research we commissioned, many homeowners recognise the importance of cutting back on their lifestyle spending, including holidays and socialising, is promising in terms of managing their future affordability.”