In recent years, the UK property market has seen a significant shift in homeownership and renting patterns. More people are opting to live in rented accommodations rather than owning their homes. This article examines data obtained from various sources like the English Housing Survey to provide insight into the percentage of Brits choosing to rent and factors that influence this decision.
A brief overview of UK’s housing situation
The United Kingdom’s population is estimated at over 66 million people, all needing a place to call home. The English Housing Survey provides valuable insights regarding the nature of housing across England, with similar surveys conducted in Scotland, Wales, and Northern Ireland. Understanding the housing dynamics more broadly can inform policies around housing affordability and access while also giving potential renters or buyers information necessary for informed decision making.
Comparing owned versus rented households
Historical trends show that there has been a consistent increase in rented properties. With reference to the latest data available, as per the 2018-2019 English Housing Survey, approximately 14.6 million households in England were owner-occupied, whereas about 4.6 million were privately rented, and another 4 million were socially rented. These numbers reveal that more than one-third (approximately 37%) of the resident population in England were renters.
Shifting focus towards younger age groups
Younger generations play a vital role in shaping the rental phenomena, necessitating the need for examination. In 2003, nearly 60% of those aged between 25 to 34 were homeowners, whereas by 2018, less than 40% within this age group had managed to buy a home. Understandably, this means that a significant portion of them now reside in rented properties.
Factors contributing to an increasing rental choice
Different factors contribute to this evident shift in renting preference, and understanding them can help paint a clear picture for the future. Following are some key factors identified:
- Increasing property prices: With a surge in house prices well above the inflation rate and income growth, purchasing a home has become increasingly burdensome and challenging for several individuals and families.
- Challenges in acquiring mortgages: In response to previous housing market crashes, stricter lending criteria have made securing a mortgage more complex, with many potential buyers struggling to meet necessary requirements.
- Evolving career dynamics: The fast-changing digital economy results in more freelancers and remote workers who prefer the mobility and flexibility offered by renting over homeownership. Moreover, job relocations and short-term employment contracts also push people towards renting as a logical choice.
- Social factors: The increasing prevalence of volatile long-term relationships can discourage people from investing in a joint property purchase, ultimately driving more singles, divorcees, or cohabiting couples into the rental market.
The rise of ‘Generation Rent’
A specific demographic group referred to as ‘Generation Rent’ represents those young adults stuck in the cycle of continuing to rent due to financial constraints and other above-mentioned reasons. To further explore the concerns associated with this phenomenon,
Ownership aspirations vs. reality
In contrast to popular belief, most of Generation Rent indeed aspire to own their homes eventually. A study conducted by the Housing Commission found that over 80% of the 18-34 age group desired to buy a property, and 73% of those aged between 35-44 held similar aspirations. Despite the prevalent desire for homeownership, data suggests that renting remains a reality; the persistent barriers to buying property also render it potentially long-term.
The impact on affordability and quality
In addition to owning a home, renters often struggle with aspects such as rents soaring above income growth and rental security. With increasing demand, rented accommodations might fall short in providing quality housing while remaining affordable for many young adults who aspire to buy their own homes.
In conclusion, the UK’s housing landscape is ever-changing, pivoting increasingly towards renting preferences over homeownership. Younger generations play a significant part in these dynamics, pushed by various economic, social, and employment factors. Addressing these concerns becomes imperative for policymakers to guarantee access to comfortable housing for all demographics – whether they rent or own their homes.
