Of the approximately 14 million 20-35 year olds, according to the Guardian.co.uk one in three of Britian’s millennial generation will never own their own home with their only alternative being to live and raise their families in insecure private rented accommodation. With the scarcity of jobs and depressed incomes, British millennials are only surpassed by those in Greece in terms of the the lowest average pay packet whilst Denmark and Greece are the only developed countries worst than the UK for high house prices in relation to incomes.
The number of privately rented households with children tripled from 2003 to 2016 resulting in a greater security of tenancy being made vital as any disruptions can impact schooling, friendship groups and support networks. Despite this however, any notion of rent controls have been opposed by landlords with the last time rent controls were implemented the private rented sector “shrunk from 90% to 7%” (David Cox, Chief Executive of the Association of Residential Letting Agents). With a shrink in sector, professional landlords will only take tenants they deem the best and as such low income and vulnerable individuals will have to resort to rogue landlords who may take advantage of their desperate situation.
Whilst the current economy is still reeling from the impact of the financial crisis of 2007-2008, particularly in the US a lack of generational income is also a factor for the lack of homeowners. Job mobility has fallen in the UK significantly whilst particularly among young men there has been a shift towards part time working. This certainly reflects the general attitude of the millennials, discarding more traditional ways of making money and living for more diverse and niche means.
The purchase of a home is typically accompanied by a new stage of life such as marriage or the birth of a child however millenials are now taking longer than previous generations to reach these ‘milestones’ in favour of becoming more financially stable. In 1990, 52% of 18-34 year olds were married in comparison to the 38% of the same demographic in 2015. This reluctance for a more traditional means of living is also evident in the preference for renting. Although many are forced to rent due to tight budgets, the increase in city center living means purchasing homes in these areas simply aren’t a viable option due to the extremely high purchase prices. With the expansion of university education, the popularity of big city centers among young, single professionals has increased with the number of 20 to 29 year olds residing in city centers tripling in the first decade of the 21st Century (bbc.co.uk).
Cities such as Liverpool have seen a significant rise in city centre living.
The rise in young professionals has come about despite the rise in student fees. More young people are turning to a university education and as such many are burdened with the fees that come with it resulting in difficulty in purchasing a home. Furthermore since the financial crisis, tighter mortgage lending standards means those with little credit history will find it difficult to qualify for a mortgage.
The difficulty of purchasing a home among the millennial generation is certainly not getting any easier, and with such a faced paced climate which we currently live in coupled with increasing house prices, there is little wonder UK rent rates are through the roof.
