Home ownership slips further out of reach for UK renters

Almost a fifth (18%) of British renters don’t ever expect to own their homes, according to a survey by flat and house share site SpareRoom.co.uk.

The site carried out a census of more than 10,000 site users, which reveals that British aspirations of home ownership are slipping further out of reach.

In SpareRoom’s 2011 census, just 12% of renters expected never to be able to buy property.

However, the reality may be even bleaker, as this figure rises significantly among those still renting into their 40s. Almost half (49%) of this age group never expect to make it onto the property ladder because they have been priced out of the market altogether, even though their annual income is 17% higher than the UK average. This group is arguably a more accurate gauge of future home ownership levels because they are at, or near, their maximum earning potential.

Across all age groups, almost (49%) of renters won’t be able to buy for five to 10 years, while almost a quarter (23%) say it will be at least a decade before they can get on the ladder.

A quarter (25%) of Londoners believe it will be at least 10 years before they can buy - no doubt due to soaring house prices and high rents eroding deposits.

Almost half of renters (49%) spend 30% to 50% of their salary on rent while more than a fifth (23%) spend over 50% of their salary on rent. Almost three in 10 (29%) tenants now consider their rent ‘unaffordable’.

Londoners (25%) and Scots (23%) are most likely to spend more than 50% of their take home pay on rent, while renters in the East Midlands are least likely to (14%). Londoners (37%) and renters in the East of England (26%) are most likely to consider their rent ‘unaffordable’, while those in Yorkshire and the Humber (15%) are least likely to.

In London, where average rents have now hit £691 per month, 39% of the average London flatsharer’s monthly take-home pay goes on rent.
 
Matt Hutchinson, director of flatshare site SpareRoom.co.uk, said: "For nearly one in five of Britain’s ever-growing population of renters, aspirations of home ownership are slipping away.

“Price rises seem to be unstoppable, with a typical London home now clearing the £500,000 mark, and prices for first-time buyers rising faster than prices for owner-occupiers. Coupled with rising rents eroding savings, it’s hardly surprising that such a significant proportion of renters have resigned themselves to never owning their homes.

“The reality is that many young professionals will never own their homes. Attitudes to renting for life will have to change as, like it or not, we are heading towards a European approach towards property, where so called ‘lifestyle tenants’ are the norm. Given the British love-affair with property ownership, this is going to be a major cultural change."