With this report Halifax asks the question: “Will rental rungs replace the property ladder”?
Despite the steady improvement in the UK economy, positive employment figures and wage growth beginning to catch up with inflation, the latest Halifax Generation Rent Report 2014 reveals that many potential first-time buyers are beginning to accept the reality of living in rented housing much longer.
According to the Halifax, their first Generation Rent Report in 2011 described “…a generation who wanted to buy but couldn’t afford to or didn’t dare try for fear of rejection.”
Three years on and 32,000 survey results later, and the Halifax say that the opinions of 20-45 year olds are changing, “opting to accept the reality of renting and live in properties that would otherwise be out of reach or require years of financial sacrifice to buy.”
The 2014 Report has been produced for the Halifax by the National Centre for Social Research (NatCen).
It indicates that since 2011 people’s attitudes towards renting have changed. If the majority of current 20-45 year olds renting are unable to buy, or choose not to buy, as they get older, the profile of the housing market will change significantly in the longer term, the report states.
Key highlights from the Halifax report include:
– One in five of 23-27 year olds have no desire to own a home
– Almost half (48%) agree Britain will become a nation of renters within the next generation
– 46% agree Britain is becoming more like Europe, where renting is ‘the norm’
– 86% of potential homeowners refuse to sacrifice the quality of accommodation they currently live in to reduce the amount of rent they pay in order to save for a deposit
– 54% of homeowners think people aren’t willing to make the necessary sacrifices to get on the property ladder
– 57% say first-time buyers today are guilty of trying to find their perfect property rather than adjusting their expectations to their means
– 57% of would-be first time buyers would like to save but claim to not have any spare cash that they could save.
Commenting, Craig McKinlay, Mortgages Director at Halifax, said: “With attitudes softening towards the social implications of renting, and the number of people who say they will never own a property increasing, we may be heading towards the point where the aspiration to own a nice home will be replaced by the aspiration simply to live in one. It seems that people are now beginning to accept a lifetime of renting and this would not only change the way the property ladder looks in the future, it could even bring into question whether or not it will exist at all for some people.”