Houses are expensive and people increasingly say that the housing market is on the wrong track due to inaccessibility and affordability challenges. Yet home ownership remains an important goal – 8 in 10 Luxembourg residents agree that it is better to own than to rent, according to the latest ING International Survey on Homes & Mortgages.
Potential home owners juggle many financial goals
Saving to buy a house is just one of several burdens placed upon household finances today. Paying off education, raising a family and funding hobbies or travel all figure highly in people’s thinking.
We asked respondents a series of questions on whether they prioritise saving for five specific goals over saving to buy a home. On average, four in five Europeans say housing isn’t their top priority right now. In Luxembourg, travel, hobbies and saving for children come first to saving for a new home.
Getting on the property ladder remains hard and 86% of people believe that it is increasingly hard for first-time buyers to buy a house. This might result in a frustration that makes people procrastinate when it comes to saving for such a long-term goal!
Buying later shifts priorities
The way we prioritise saving for a home reflects perceptions of a market that is considered to be expensive and inaccessible. While perception might be that past generations placed almost all their effort into building a house deposit early, the latest ING International Survey suggests wider economic pressures are among several reasons why this may not be happening today.
Given that many are saving a house deposit over longer periods and becoming home owners later in life, it’s perhaps unsurprising that how we save for one of life’s biggest purchases is being impacted. This may reflect a change in life cycles. Increasing expectations of a longer working life could mean there is more time to take a first step onto the property ladder. And while some argue spending on increasingly affordable alternatives such as travel contributes to the challenge of home ownership, our survey suggests this is part of a broader shift. We are all managing multiple and diverse financial goals.