There is no denying that many people view homeownership as a passage in life. Owning your home and having a place that is yours is an ambition for many people, but in recent years, a growing number of people have decided that homeownership is not for them.
VeriSmart undertook a recent study, a letting compliance company, examined the shift from homeownership to rental occupancy in the United Kingdom.
There is a great deal of focus on the relationship between the UK and the EU these days, and when it comes to homeownership, the UK has fallen behind. Anecdotally, the UK was seen as a leader in homeownership compared to many EU nations, but the research indicates the EU lies 24th out of 28 countries.
There is 65% of homeowners in the UK
For tenant occupiers, the UK sits much higher, being the fifth largest of the EU nations, sitting behind Germany, Austria, Denmark and France.
These figures are impressive by themselves, but for many people, it is the movement in these figures over the past decade that is of interest. Since 2010, owner-occupancy rates have fallen by 5% while the percentage for tenancy-occupancy has increased by 5%.
The fact that there is still a 65% owner-occupancy rate in the UK suggests that owning a home is still essential for many people. It is a good goal in life, and there is a lot of support on offer to help people step on to the property ladder.
Tenants may outnumber owner-occupiers in the future
However, projections suggest that this could change in the future. If the current level of decline is maintained, by 2039, there would be more tenants than homeowners in the nation. By the year 2045, the balance would tip to 55% rental-occupancy and 45% owner-occupiers.
Of course, while there are tenants who have been priced out of the property market, there are also people who choose to rent. There is freedom and flexibility associated with renting that many people prefer. There are more options for people these days, and renting, as opposed to home ownership, allows people to make swifter decisions and to travel if the need arises.
Jonathan Senior is the founder of VeriSmart, and he commented on this matter, by saying; “We are currently seeing a shifting mentality in the way we choose to live our lives and for Generation Rent, in particular, there is no longer that urgency to make it out of the rental sector and secure their own ‘piece’ of bricks and mortar.”
‘Bricks and mortar’ will always be seen as a suitable investment, and house prices should continue to rise. Therefore, there will always be a desire to own property amongst a large proportion of the population. However, there is no denying the mindset around property ownership is changing, and it is essential the market evolves to meet everyone’s needs.
No matter what move you wish to make in the property or rental market, Thomas Morris is here to support you. For a chat or discussion on your options, contact your local Thomas Morris branch, and we’ll be delighted to offer guidance. If you are looking to sell your home, book a valuation at a time that is of suitable to you.