Falling home ownership levels have revealed a changing attitude among younger generations, who are simply choosing to rent rather than own a home.
According to figures from the Local Government Association (LGA) home ownership in the UK has fallen to its lowest level in 30 years, with ownership rates among 25 year olds dropping from 46% to just 20% in the last two decades.
Many experts are pointing the finger at a lack of affordable housing available for first time buyers, however the results of a recent tenant survey conducted by Knight Frank found a different cause.
38% of under 35s and 49% of under 25s stated that renting was a conscious decision, and that it suited their lifestyle. Rather than laying roots in an area and settling down, under 35’s prefer to have the freedom to move.
Grainne Gilmore, Head of UK Residential Research at Knight Frank, comments: “There has been a generational shift in the private rented sector (PRS). More households are now living in rented accommodation for longer, and while housing affordability is certainly a factor here, rented accommodation is also becoming an established flexible form of tenure, an attribute welcomed especially among younger workers.”
The PRS industry only looks to expand over the next three years, with many experts estimating investment to rise to £50 billion by 2020. This could trigger a movement in focus for investors, moving from medium-term capital to long-term income-generating assets.