With the Autumn Statement soon to be upon us, the press is alive with speculation. One topic that keeps re-appearing, is how the Government plans to address the chronic housing shortage around the country and how and where new homes will be built. But, it looks as though the Chancellor may not just focus his efforts on homeownership, as his sights are set on Generation Rent too.
For the first time in decades, it would appear that a generation of Londoners are set to become lifelong tenants – but in privately rented homes, as opposed to social housing. This is a very different situation to 16 years ago; in the year 2000, 60% of Londoners owned their homes, either outright or mortgaged. Today, recent research has revealed that 60% of Londoners will be renting by 2025 – giving the capital its colloquial name, the City of Renters. If you were born between 1960 and 1970, then 64% of you living in London would have owned a house by the time you were 35. Today, there is less than half that chance, as just 26% aged between 20 and 39 will own their home by 2025.
It means that for many young people living in the capital, they will never own a home inside of the City. What’s more, the shortage of attractive, suitable and affordable housing on offer in the private sector is hard to come by, forcing many people living in London to choose accommodation that is not always fit for purpose. According to the latest figures from the University of the West of England, London is now 18 times more overcrowded than the rest of the UK, so finding suitable housing is becoming more competitive than ever.
The solution is thought to lie in the 30,000 new flats for rent are either built or being built in all but three London Boroughs – and many more are expected in the near future. It appears that for the first time, the Government is focusing efforts away from owner-occupation and is instead switching focus to the private rented sector instead, in efforts to get more houses built. Competitiveness in the rental sector has left many Londoners priced out of decent quality accommodation from a regulated large-scale landlord. It has paved the way for big financial institutions and hedge funds to happily plug the gap in the market.
This “Build to Rent” scheme is thought to be able to provide modern housing for rents starting at £250 per week and the Autumn Statement could be an opportunity for new housing minister, Gavin Barwell, to promote a new focus on the private rented sector, switching away from David Cameron’s mission for owner-occupation, and building more houses for rent. New style renting is fast becoming the way of the 21st century world we live in and is increasingly becoming a lifestyle choice rather than an affordable alternative to buying.
What would you like to see come out of the Autumn Statement? Are you a Generation Rent-er keen to buy your first home, or do you choose to rent your property so that you have more flexibility? Here at DMH Stallard, our expert property lawyers have a wealth of experience to assist you with a number of enquiries, either relating to the Autumn Statement or otherwise. Contact us today to find out how we can help you.