UK set to become a nation of renters in next 20 years
If people renting a home continue to do so and not move onto the housing ladder at present rates then the UK will see more renting than owning a home by 2039, according to new research.
Currently home owners account for 65% of the housing market, a fall of 5% since 2010. If there is no change in tenures then that is set to become 50.7% renting and 49.3% owning within 20 years.
The analysis from letting compliance firm VeriSmart also says that by 2045 this will have grown to 55% of the nation living in the rental sector and 45% owning their own home.
It suggests that this is not a trend driven out of necessity but rather people choosing to rent within the private sector, as during this time the number in social rental accommodation has also dropped.
‘We are currently seeing a shifting mentality in the way we choose to live our lives and for Generation Rent, in particular, there is no longer that urgency to make it out of the rental sector and secure their own ‘piece’ of bricks and mortar,’ said Jonathan Senior, chief executive officer of VeriSmart.
‘This was initially driven by consistently buoyant house price growth coupled with stagnant wage growth providing no other option but to rent, however, social rental numbers are falling, Build to Rent is growing in prominence, and there has been a number of tenant friendly changes to the sector,’ he explained.
‘All of these changes are making the rental sector a more attractive place to be and as a result, we are seeing more of us opt for it and stay there for much longer than we may have traditionally,’ he added.
The firm also points out that while the UK is a nation of aspirational home owners, but the high cost of property has seen many remain in the rental sector. Indeed, the UK currently ranks as the 24th lowest of all 28 European Union nations.
In contrast, the UK is home to the fifth highest percentage of tenant occupiers of all EU nations, behind just Germany, Austria, Denmark and France.