"Most renters dream of owning their home one day, but the struggle to save has got even worse in the past decade. In much of the country, the typical worker faces at least a decade living and saving in the private rented sector before they have a mortgage deposit. That gets close to two decades for Londoners and even then that’s only possible by sharing with other people into their forties” he claims.
“More people are renting from private landlords for longer stretches of their lives, and want a home that allows them to settle down. That’s why we need the measures in the Renters Reform Bill that will stop landlords evicting tenants without a valid reason, drive out criminal landlords and improve the quality of private rented homes."
Research by his group suggests that in 2012 it would, on average, have taken 6.8 years to save for a deposit for a mortgage. Higher rents and house prices mean it now takes nearly a decade, at 9.6 years to save for a deposit.
The research shows that the region least affected is the North East, where it takes the same amount of time as it did a decade ago (approximately 4.6 years) to save for a deposit; London is the worst affected taking an extra 4.3 years to save for a deposit, making the average time to save for a deposit in the capital some 18.3 years.
A key element in the expanded timescale is is the increase in the price of the average first time buyer home, which rose by 72 per cent between 2012 to 2023 to £253,202.
The group’s statement says: “With ordinary renters facing many more years in the rental market before being in a position to buy, Generation Rent is calling on MPs to back the Renters Reform Bill and make sure that renters are properly protected from unfair evictions and substandard housing.
“To reduce rents and therefore the length of time it takes to save, Generation Rent is calling on the government to build enough homes in the places people want to live, including social housing which will directly help those most in need.”
The group says it has looked at government data on rents, house prices and salaries to estimate how long it would take the typical single renter to save for a deposit.
Assuming that tenants saved 20 per cent of the income they had left after tax, student loan contributions and rent, the median renter nationally could save £2,177 per year in 2012, which rose to £2,630 per year in 2022-23, a rise of 21 per cent.
However, Generation Rent claims that because the average 10 per cent deposit for first time buyers of £14,745 in 2012 has now inflated to £25,320, it would take 9.6 years of saving to reach.
In London the position is even more severe and the statement claims: “The median rent on a one-bed in London is £1,276, 48 per cent of the median salary. A renter realistically could only live in a shared house, but even then it would take 18.3 years to raise the average deposit of £45,979.”
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there’s a connection between Section 21 and the period of time people rent while saving for a deposit to buy a home.
What????? Am I missing the point? I fully get the financial issue for first timers and it is an issue . But it has as much to do with S21 as the 1969 moon landing.
“that will stop landlords evicting tenants without a valid reason”
There always a reason which is why it’s used - use some logic Ben
Twomey is campaigning for the wrong things.
The Rental Reform proposals will increase rents simply by encouraging a lot of landlords to sell up. A large number of independent landlords are over 55 and don't need the stress and uncertainty of all the half baked ideas in the RR.
The financial climate is also conducive to selling up. For the last 15 years there's been very little incentive to put money elsewhere. Interest rates were rock bottom, the Stock market just feels like posh gambling and then we were suddenly trapped with sky high CGT liabilities.
Now with a combination of higher mortgage rates, Section 24 and higher interest rates on savings plus the possibility of falling property prices selling is suddenly looking far more attractive.
Twomey needs to look more closely at why tenants are evicted. Section 21 doesn't mean 'no fault', it means 'no reason given'. The only time a good tenant is evicted is if the landlord wants to sell or if the property needs major work. Maybe occasionally if the landlord hasn't increased the rent for the last few years and now finds themselves in the position of doubling mortgage costs, Section 24 and rents that are way below the current market rate. It's an awkward conversation to have with long term tenants.
If Twomey wants stability and high standards in the PRS he should be campaigning for landlords to be treated fairly. If we were taxed in the traditional way rents could be lower. Does he understand the first 20%, 40% or 25% of a tenants rent goes straight to HMRC if they rent from an unincorporated landlord who owns more than about 2 properties? That's on top of the normal tax a landlord pays. It isn't the landlord who gets this money, it is HMRC. It is a tenant tax and I'm staggered all the activists haven't campaigned vigorously to get Section 24 abolished.
Making fault based evictions incredibly slow and difficult leaves good tenants homeless for longer. Get the feckless tenants out quickly and free up homes for decent tenants.
Absolutely spot on. In every respect!
Good point about the first 20% going to Govt.
May mention that next time I have to increase rents mid-tenancy; though that's not something I usually do.
And another x% (whatever the figure) going to the agents + 20% VAT to Govt. on that fee.
My reason to evict is MY business, because I OWN the bloody thing !! The majority of renters today will never own their own home…. Never. This is why my adult children have never/nor will ever, rent !! I am selling a property now which will be split between them and this top up will then enable them both to buy 💰💰🎉🎉 what the children of parents who don’t have this option will do……God knows.
My son was living at home till he was 27. He was working and saving almost all his wages. He did not pay us any rent. He did not have a car or girlfriend, did not drink or go out and by the age of 27 managed to buy his first house, a 3 bed terraced. He just made it a priority to buy his own house.
Thousands of Flats going up now offered on Shared ownership, if people are stupid enough to fall for this nonsense they’ll be missing the Private landlords.
We hear the claims of "you had it easy" etc but always forgetting that in 1985 Basic Rate Income Tax was 30% and the allowance was just £2205 for a single person. A higher rate was up to 60%.. add to that Mortgage rates of around 12% it's not quite the garden of roses, there was no help to buy schemes or PEPS
They need to ask themselves why have prices risen. It is nothing to do with Landlords.
It all goes back to Tony Blair who decided to send everyone to University to massage unemployment figures and as a result we had a generation of young people who had good salaries and Lenders decided to change their lending criteria to base the amount on two salaries. Overnight we saw house prices rocket and until Lenders change the formula back to basing it on one salary prices will remain high.
Current owners are unable to sell at lower prices because they will have negative equity!
Yet another example of Government action causing a reaction, just like at present!
If they think prices of houses should reduce what are they going to do about the rising cost of the materials to build them?
I see the first of the builders went bust yesterday- just watch more will follow so how will that help Gen Rent?
How did this guy get S21 and direct link to house prices? He is off his box, less than 2% of all evictions have been with S21 so how he has linked this I will never know???
Nope, read that article 3 times and cannot see the correlation between s21 and high house prices??
I'm guessing that Ben is trying to justify his salary at Generation Hate, they all probably cheered loudly when he read this rubbish out at story time!
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