‘Generation Rent (Forever)’ –
3,497 Harlow Tenants have no intention of ever buying a property to call home
The good old days of the 1970’s and 1980’s eh … with such highlights
lowlights as 24% inflation, 17% interest rates, 3 day working week, 13%
unemployment, power cuts ... those were the days (not)… but at least people
could afford to buy their own home. So why aren’t the 20 and 30 something’s
buying in the same numbers as they were 30 or 40 years ago?
Many people blame the credit crunch and global recession of
2008, which had an enormous impact on the Harlow (and UK) housing market. Predominantly,
the 20 something first-time buyers who, confronting a problematic mortgage
market, the perceived need for big deposits, reduced job security and declining
disposable income, discovered it challenging to assemble the monetary means to
get on to the Harlow property ladder.
However, I would say there has been something else at play
other than the issue of raising a deposit - having sufficient income and rising
property prices in Harlow. Whilst these are important factors and barriers to
homeownership, I also believe there has been a generational change in attitudes
towards home ownership in Harlow (and in fact the rest of the Country).
Back in 2011, the Halifax did a survey of thousands of
tenants and 19% of tenants said they had no plans to buy a home for themselves.
A recent, almost identical survey of tenants, carried out by The Deposit
Protection Service revealed, in late 2016, that figure had risen to 38.4%, with
many no-longer equating home ownership to success and believing renting to be
better suited to their lifestyle.
You see, I believe renting is a fundamental part of the
housing sector, and a meaningful proportion of the younger adult members of the
Harlow population choose to be tenants as it better suits their plans and
lifestyle. Local Government in Harlow (including the planners – especially the
planners), land owners and landlords need an adaptable Harlow residential property
sector that allows the diverse choices of these Harlow 20 and 30 year olds to
be met.
This means, if we applied the same percentages to the
current 9,107 Harlow tenants in their 3,764 private rental properties, 3,497
tenants have no plans to ever buy a property – good news for the landlords of
those 18,636 properties. Interestingly, in the same report, just under two
thirds (62%) of tenants said they didn’t expect to buy within the next year.
.. but does that mean the other third will be buying in Harlow
in the next 12 months?
Some will, but most won’t … in fact, the Royal Institution
of Chartered Surveyors (RICS) predicts that, by 2025, that the number of people
renting will increase, not drop. Yes, many tenants might hope to buy but the
reality is different for the reasons set out above. The RICS predicts the number of tenants
looking to rent will increase by 1.8 million households by 2025, as rising
house prices continue to make home ownership increasingly unaffordable for
younger generations. So, if we applied
this rise to Harlow, we will in fact need an additional 1,613 private rental
properties over the next eight years (or 202 a year) … meaning the number of
private rented properties in Harlow is projected to rise to an eye watering 5,377
households.
For more insight and thoughts like this on the Harlow
Property Market – please visit the Harlow Property Blog at http://harlowproperty.blogspot.co.uk/