The increasing cost of mortgage borrowing means many more Generation X homeowners will be paying off their mortgages into a retirement.
This is according to a survey by Just Group which found 45% of those in the 42 to 58 age category with a mortgage said it was taking them longer to pay off than they had hoped.
The most common reason for this was because they had been forced to extend their mortgage term to reduce monthly repayments.
Indeed, the survey found over a quarter (27%) of Gen X, who are classified as those born between 1965 and 1980, were not confident of paying off their mortgage before age 67.
Just Group said 13% firmly believed they would not be able to pay off their home loan by the time they reached the age at which most of this cohort become eligible to receive the State Pension and a further 14% were unsure if they could.
What’s more, double the number of Gen X London residents with a mortgage said they didn’t expect to repay their mortgage before 67 compared to the national average.
Stephen Lowe, group communications director at retirement specialist, Just Group, said: “About three-quarters of the Gen X cohort own their own homes but many are struggling to clear their mortgage within the expected time frame.
“This group find their finances stretched and are faced with the unenviable choice of either clearing the mortgage or saving for a pension.
“People’s budgets are being squeezed as they juggle competing pressures. As a result, we are seeing growing anxiety among this demographic that many will approach retirement still carrying the burden of making their mortgage repayments.
“This is felt more acutely among those in London, where property prices are higher and nearly double the national average of Gen X homeowners with a mortgage worry that they will still be saddled with a mortgage as they enter retirement.”
