Over half of people renting a property in the UK do so because they cannot afford to purchase outright, according to new research.
Recently, there have been a number of announcements regarding more affordable homes in the capital. However, research from Knight Knox shows that many aspiring buyers cannot even afford these properties.
This research comes soon after separate data from the Halifax which indicated property prices in Britain increased substantially towards the end of 2016.
The investigation from Knight Knox found that 52% of people currently living in rental property revealed that cannot afford to purchase outright. 25% do not meet specific criteria for a mortgage.
These findings give weight to the notion that the increasing costs of monthly rent and house prices, alongside low salaries, is causing an affordability crisis in the UK. However, this can only be good news for the rental market.
Interestingly, the survey also revealed that 60.7% of respondents were quite happy to rent. They gave reasons such as the flexibility suiting their lifestyle and not wanting to be tied down to a mortgage.
Only 23.5% claimed that they were currently saving for a deposit.
Andy Phillips, commercial director at Knight Knox, observed: ‘The results of the poll show that the demand for rental properties nationwide is higher than ever and that renting, contrary to traditional consensus, is an appealing option and active choice for many people in the UK.’
‘The lack of people saving for a deposit, coupled with the apparent affordability problem, could mean we are seeing a shift towards a PRS centric property landscape, similar to that which has long been a way of life in Germany and wider continental Europe,’ he continued.
75% of renters between 18 and 24, mostly paid under £20,000, said they were happy with renting. However, 56% of those aged 35-54 said they were still unable to raise a deposit. This said, 42% of these respondents noted they were happy with renting.
Concluding, Phillips said: ‘It’s encouraging to learn that the older demographic are equally satisfied with being in a rental property as the younger millennials. It seems that people of all generations are discovering the benefits of more flexible living. Although affordability concerns are undeniable, it looks as if an increasing number of people are making a virtue of the necessity when it comes to renting.’