The sky-high property prices of recent years have effectively shut recent graduates out of the property market according to new research by the Scottish Widows Bank.



Out of 1,155 former students polled (all under the age of thirty), 63 per cent did not own their own property, while a further 10 per cent say they cannot even imagine owning their own home. 19 percent believe it will take them up to ten years to get on the property ladder.



Scottish Widows spokesperson, Murdo McHardy, compounded the bleak outlook by claiming the situation is likely to get worse:



“As it stands, this generation of graduates could be struggling to get on to the property ladder well into their thirties or even forties and, unfortunately, the situation is only going to get worse. Student debt is on the increase and this, coupled with the huge rise in house prices, is making it impossible to save an adequate deposit.”



Just over a third want to pay off their student loans before buying their first home, while two thirds were finding saving for a deposit almost impossible. About 14 per cent say they plan to marry before they buy a home, and 17 per cent of over 25 year olds said they wouldn’t have gone to university in the first place had they known it would have limited their capacity to buy property.



With the advent of top-up fees, students graduating last autumn did so with debts averaging around £13,000. Inevitably this has a considerable effect on their lives when they leave university, as priorities change at paying off debt, rather than property ownership, becomes the priority. Proof, if it were needed, can be seen in the average age of first time buyers which is 34, up from 29 in 1974.



The Government has taken some steps to tackle the problem; a “key workers initiative” was announced recently, which is to provide a chance for low paid professional to get a toehold on the property ladder under a plan to offer first homes for £60,000. Do these steps go far enough? Not according to McHardy:



“Moving to an area where house prices are cheaper is an option but should our brightest prospects really be expected to compromise their career plans to put a roof over their heads?”



Her solution is to encourage lenders to offer students bigger mortgages. This is an idea that those in the industry are beginning to put into practice. A spokesperson for the Council of Mortgage Lenders said:



“Lenders offering graduate mortgages offer them in the expectation that their income will rise as their careers develop. It’s also true to say that we’re likely to see even more innovation among lenders in the future because graduates are coming out with higher and higher debts.”