Finance experts are warning that a crisis is unfolding as millions of UK homeowners face the prospect of carrying mortgage debt well into retirement, according to new analysis.
The combination of delayed homebuying, soaring property prices and extended mortgage terms has created unprecedented challenges for borrowers.
Research by mortgage overpayment app Sprive reveals that two-thirds of last year's first-time buyers will still be making payments in their 60s.
The situation is further complicated by the threat of artificial intelligence to job security, with predictions that up to eight million UK positions could be at risk from automation.
New research is warning that British pensioners could be saddled with mortgage payments in retirement
GETTY
Of the 827,000 first-time buyers who purchased with mortgages in 2023/24, 11.5 per cent were aged 45 or over - nearly triple the 3.6 per cent recorded in 2019/20.
More concerning still, 84.9 per cent of these buyers committed to mortgage terms exceeding 25 years.
Almost a third opted for terms of 35 years or longer, effectively guaranteeing decades of debt repayments.
The analysis found that 547,000 of 2024's first-time buyers - 66 per cent - will continue paying mortgages into their 60s. At least 26,000 will still face housing debt in their 70s.
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Debt has becoming a major issue for households amid the cost of living crisis GETTYFamily wealth has become increasingly crucial for homeownership, the research found. Nearly a third of first-time buyers in 2024 received financial help from relatives or friends, rising to over a third among 25-44 year-olds.
Inheritance dependency is particularly pronounced among older buyers. Almost one in five buyers aged 45-64 relied on inheritance, double the overall average of 9.2 per cent.
Only 59.5 per cent of this age group could purchase using savings alone, compared to over 90 per cent of under-35s.
Changes to the employment landscape were also recognised as adding another layer of risk for thinking about retirement.
With AI and automation threatening up to eight million UK jobs, particularly in white-collar sectors, many homeowners face uncertain income prospects whilst committed to decades of mortgage repayments.
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GETTY"We're seeing the emergence of a perfect storm," said Jinesh Vohra, CEO of Sprive. "People are getting on the ladder later in life many because they are 'wait to inherit' buyers who are stuck renting into their 40s, hoping for financial support or inheritance to break in."
He warned about the convergence of risks: "Carrying mortgage debt into retirement is becoming the norm but it's incredibly dangerous when future income is uncertain.
"If your mortgage runs until you're 70 but your role is replaced by AI in your 50s, what happens then?"
Vohra advocates mortgage overpayment as a solution, with his app offering cashback through everyday shopping to help borrowers reduce their terms.
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