Britons forced in to ‘modern day slavery’ by soaring house prices
Massive mortgages are turning a generation of parents and first-time buyers into the modern equivalent of slaves, an alarming report has claimed.Those who manage to scrape on to the property ladder and parents with young families are like “bonded labourers” tied to their jobs, it said.
And it warns the soaring price of homes means Britain is in danger of becoming a “grossly divided” society, similar to that which existed in Victorian times.
With housing prices soaring to unprecedented levels, many young couples have been reduced to ‘bonded labourers’ in a ‘modern day slavery’, the shocking report has claimed.
The shocking report, published today, paints a bleak picture of the devastating social consequences of the crippling cost of buying a home.
“Super-size” mortgages - the size of which would be “inconceivable” to previous generations - are forcing soaring numbers of parents to desert their children in order to work long hours.
Many are taking on second jobs in a desperate bid to pay a mortgage which could be up to seven times’ bigger than their salary.
It comes as figures revealed the average home loan taken out today is a record-breaking £152,800.
Many homebuyers in the South have to borrow more than double this amount with average asking prices of nearly £400,000 in the capital.
The report, from the Universities of Aberdeen and Loughborough, warns of the damaging social consequences of today’s record home loans.
Dr James Bone, a sociology lecturer from the University of Aberdeen, said: “For these young homeowners, the burden of mortgage debt will place great stress on those who have families.
“Both debt-harassed parents are forced to work increasingly long hours to meet the mortgage payments.
“Little time will be left for family life and little disposable income with which to enjoy it.”
He compares the plight of many young homeowners to “bonded labourers”, forced by large mortgages into a position close to slavery.
“Many young couples and families are now assuming levels of debt that will render them little more than bonded labourers,” he said.
The early findings from his study, published today, says Britain could be returning to the sort of social divide not witnessed since the Victorian times.
It will create a “grossly divided society last seen in the 19th and early 20th century”, according to the study of people aged 18 to 40.
For people who do buy, they will be taking on levels of debt which would have been “inconceivable” to previous generations. The average mortgage has jumped rapidly from £50,000 in 1994 to £100,000 in 2003 to £150,000 today, according to the British Bankers’ Association.
If they have families, their huge debts will force both parents to keep on working, even when their children are very young.
For people who do not buy, the consequences could be equally damaging.
Many will feel forced to delay getting married or having children because they want to own before making such an important commitment.
Without their own home, many will have to live with their parents, rent at vast expense or live in “student-style” house-sharing, even in their thirties.
One family involved in Dr Bone’s study, “On the Treadmill”‘, spoke of the misery involved in renting, rather than owning their own home. They have been moved five times in four years, as their landlords decided to sell-up or start charging an extortionate rent.
Official figures show the number of working women has soared over the last 30 years, according to the Office for National Statistics. When records began in 1971, there were nine million working women. Today, there are 13.3 million.
Since house prices started rising a decade ago, forcing people to take on bigger mortgages, an extra one million women are working full-time.
A spokesman for the think-tank, the Relationships Foundation, said: “This report highlights a very difficult situation for many families.
“When taking on these huge mortgages, parents mustn’t forget that a good home is more than just a large house. It involves time together as a family.
“There is a wealth of research showing that keeping time for children is essential for their well-being and helps them educationally, socially and emotionally.”
House prices have been rising for more than a decade to reach a record of nearly £200,000. They are still rising at an inflation-busting 10.9 per cent, according to the Halifax, Britain’s biggest mortgage lender.
It estimates that buying a home is impossible in 70 per cent of towns for key workers, such as teachers, police, firemen and nurses.
Four interest rate rises since last summer - and the threat of a fifth just round the corner - is making the situation even worse.
David Stubbs, senior economist at the Royal Institution of Chartered Surveyors, said: “Stretched affordability amongst first-time buyers means that many cannot contemplate buying a home at the increased rates of interest now been demanded by mortgage providers.”
Recent research found rising numbers of young people under 30 can only afford to buy with help from their parents.
About 40 per cent of young people who have bought over the last three years had help from their parents, according to the Council of Mortgage Lenders.
Historically, just one in four people had help from the so-called “Bank of Mum and Dad”.
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