Despite the new Help to Buy scheme, a study of 2,000 under 35s reveals widespread pessimism about the chances of homeownership.
The report for L&Q shows that around 70 per cent of those saving for a deposit have become so disillusioned they have stopped saving and spent the money on holidays, cars or bills.
Lucy Chitty, Assistant Director of Sales for L&Q said: "It's clear that despite signs of recovery, many of the younger generation view the prospects of owning their own home as an unlikely dream.'The study shows many are disheartened in their attempts to get on the property ladder and have abandoned efforts to save for a home altogether.
"Many people now see becoming a homeowner as so unrealistic that they've decided to splash money on temporary luxuries or intangible things, further reducing their ability to buy property in the future."
The study showed that three quarters of the 2,000 under 35s describe themselves as 'nowhere near' to even getting on the property ladder.
Indeed, seven in ten think it will be at least five years or more before they can become a homeowner and just over 80 per cent said it was becoming less realistic to expect to own a home in Britain.
The average person thought 33 was the earliest age people could realistically hope to get on the ladder, after having saved for a deposit for at least six years.Reuse content