27 Mar For first time in 7 years more young people now own than rent
Many of us will be spending quite a while at home in the coming months, giving us time to contemplate the four walls that we call home, to decide whether they are in fact the walls we can see ourselves staring at for the next few years, or if we need a change. Back in January, the FT wrote an article titled ‘Young homeowners catch up with private renters again’, which highlighted that more and more of us are following the British dream of owning our own homes, so we thought we’d share the essence of it with you in case you’re inspired to leave the world of landlords and estate agents behind you and stroll towards the sunny uplands of ownership.
Are you a happy renter, or does the fact that you’re beholden to someone else – your landlord – and with that, the worry of rent rises, nervousness about damaging someone else’s property, the insecurity of a finite tenancy term, etc., make you wish you owned your own home so you could do what you liked, when you liked, so you could put down roots? Apparently, there are now more 25- to 34-year-old homeowners than private renters in England for the first time in years. Lucky so-and-so’s who can now choose whether to redecorate, knock their kitchen through to their dining room, build an extension out the back or into the loft (given certain planning considerations).
But how come this has happened now? Since the global financial troubles of 2008, lenders no longer offer the 95%, 100% or even 105% mortgages that they used to, and buying a home will require you to have a significant deposit. None of this has changed, so why has the number of buyers? It’s likely to be down to a few factors:
Mum and dad may have profited from the pre-2008 property boom, buying up investments and renting them out or ‘turning’ them for a profit, so they could have a little extra liquidity lying around in their bank account. Even if they didn’t, for over a decade they have seen their younger generation struggling to save enough, so they may have been persuaded to dig deep to give their kids the start in life they could have had before the crash.
The excesses of multi-home ownership have become socially and politically frowned upon, so new tax burdens placed on landlords and investors have reduced the number of people who buy properties to rent out. Lower rental stocks mean higher rents and this in turn means fewer people who are able to afford those rents and, therefore, will stay at home. This may mean more people now have funds to buy a property – whether the reason is because it’s just too much for mum and dad to put up with for years on end (so they hand over the money) or their kids could save because they’re not paying rent.
Help to Buy.
The government has put a significant amount of money and effort into expanding their Help to Buy scheme, which assists younger buyers with smaller deposits to purchase their own first home. This may be something they do with a friend, with parental help, or just by pushing themselves just that little bit harder to afford it.
People just dreaming big.
The dream is enticing. The idea of a place of your own starts out just meaning anywhere other than the bedroom you grew up in, but when the reality of renting bites you might start redefining what you want from a home. Is it somewhere you can personalise, somewhere with a new kitchen, open-plan living or bifold doors looking out onto a colourfully blooming garden? Whatever your dream home might be like, dream big and look into the means available for you to buy it.
If you are one of the lucky ones and you find yourself with your first pad in need of a little renovation or an extension, call us on 0203 021 2140 or email email@example.com.