More graduates turning to friends and family

23-Nov-2007

More and more graduates are looking to joint mortgages as a way of getting onto the first rung of the property ladder, despite the potential risks involved, Scottish Widows has said.

The firm's latest graduate first time buyer survey has revealed that the percentage of former students opting for such deals is now approaching three-quarters of the entire graduate market.

Seventy-two per cent of graduate buyers either bought with their partner, a friend or a family member, according to the study - compared with 69 per cent saying they had done so a year ago.

In total, 44 per cent of graduates said they had been able to buy their own home.

However, the study also revealed that 69 per cent of those with shared mortgages said they would be unable to buy their co-buyer out should the need arise - leading Scottish Widows to advise prudence before plunging in to such deals.

"In principle, with a widening gap between earnings and house prices, it is a good idea, as it can help overcome some affordability issues," said Scottish Widows Bank communications manager Amanda Docherty.

"However, this is not an arrangement that people should rush into. Nobody wants to end up in a situation where they find it extremely difficult to share a home with someone they no longer get on with but can’t afford to do anything about it," Ms Docherty cautioned.

The report comes after the National Association of Estate Agents (NAEA) suggested that a slowing market may be able to help more new buyers to purchase property.

Mortgage market begins to shift again.

More singletons on Scottish housing ladder

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