House prices go up (up 2.8% compared to last year – typical cost of a home is now £236,800). Levels of home ownership have gone down. Recent media reports, more than half of those under 40 will be living in rented properties by 2025.
The growth of private renting among young people over recent decades has fuelled concerns. Millennials have been labelled “generation rent”, as growing numbers of young people are renting their homes for longer periods of their lives than their parents’ generation.
Home Ownership increasingly out of reach!
Home ownership and social housing are increasingly out of reach for young people. A situation aggravated by the challenging youth labour market, rising student debt and welfare reforms. All of which make it more difficult for them to fly the nest and set up their own home.
Recently reported that the fact of the matter is to do with “class” i.e income and family background are having a huge impact on how young people navigate the housing market. Reports are stating that young people from wealthier families are more likely to become homeowners. They are more likely to have financial assistance from the “bank of mum and dad”, and their parents are also more likely to have housing wealth to pass on. How wonderful for them, but what about the “Norm” majority don’t have this luxury of the “bank of Mum and Dad”!.
Yes, there seems to be a stark divide among Britain’s young people. At the age of 30, people whose parents don’t possess any property wealth are around 60% less likely to be homeowners.
With House prices increasing 4% to 5% a year and a shortage of affordable homes are set to swell the ranks of “generation rent” over the next decade. So that by 2025 more than half of those under 40 will be living in properties owned by private landlords.
Recent report from accountancy firm PwC suggests the number of new homebuyers is set to fall over the next 10 years, as the high cost of raising a deposit locks large segments of society out of the housing market.
Levels of homeownership have gone into reverse!
Levels of homeownership have gone into reverse -after years of increases that were stoked by Margaret Thatcher’s right-to-buy policy and the deregulation of the mortgage-lending business.
Reports suggests this trend will continue. By 2025, a quarter of all households will privately rent, they predict, with the biggest increase among those aged between 20 and 39, where “ a clear majority” will be private tenants within 10 years.
So the question should be asked “ is it too late too late to save generation rent”?
Common comments from “Generation Rent” with regards to owning and renting a home;
“It’s raising a deposit I find so difficult”
“I’m on my own, so I cannot get a mortgage without a large deposit, and I’ve never had enough money to save towards it”.
“I had to leave the property because the landlord wanted to sell”.
“After six years of renting, I have nothing – but my landlord profits quite nicely”
“I am spending over 70% of my wages on living expenses”
“The rental market is draining all my money”
“House prices continue to rise but our pay does not”
“Every year we don’t know whether the landlord is going to sell”
“It starts to make you wonder, do we even matter at all? ”
Bunce has been designed to support generation rent on to the property ladder check out our website: www.buncecrowd.com