Are rental rungs replacing the ‘property ladder’?

A recent report from Halifax has revealed a change in attitudes towards renting.

In 2011, the first Halifax Generation Rent Report described a generation who wanted to buy but couldn’t afford to or didn’t dare try for fear of rejection. Three years and 32,000 survey respondents later, 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 report highlights that if the majority of current 20-45 year olds renting are unable or choose not to buy as they get older, the profile of the housing market will change significantly in the longer term. This would mean homeownership would reduce with time, with fewer and fewer people making their way onto and up the property ladder.

Key findings from the 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.

“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,” said Craig McKinlay, Mortgages Director at Halifax.

“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,” he added.

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