Homeownership - Lowest in 30 years in UK
Latest report reveals that homeownership has reached a new all-time low; the lowest in thirty years. Back in 2003, homeownership peaked at 71%, but since then has shown a steady decline and is now reported to stand as low as just 64%, including those who own a property outright or have a mortgage.
London is well known for its overcrowded living conditions, however, contrary to popular belief, it is not alone when it comes to lack of affordability. Leeds, Sheffield and Greater Manchester were the next cities revealed to have low level homeownership, having dropped by double figures.
What Has Contributed to Low Homeownership?
One main contributor that had led to this is affordability. Affordability stands as the main barrier that can get in the way of people owning their own home. Many future homeowners, and homemovers, often struggle to find the funds for their deposit and are therefore falling into the renting trap.
Private renters have almost doubled from 11% in 2003 to 19% in 2015, and the report further revealed that young people in private renting are spending an average of 30% of their income on rent, compared to 23% for homeowners.
Theresa May expresses her opinion on the challenge facing new buyers, “Young people will find it even harder to afford their own home. The divide between those who inherit wealth and those who don’t will become more pronounced. And more and more of the country’s money will go into expensive housing.”
As we can now see it is proving ever more difficult to get on the property ladder, which could result in an increase in the amount of Shared Ownership properties there are.
Shared Ownership gives you the chance to own a proportion of your home (between 25% and 75% of the home’s value), and then pay rent on the remainder of the property. This could be ideal for those who have saved a decent amount of money but are just falling short of having the full amount. You can also change the amount you own as you go along, so if your pay increases over the upcoming years, or you come into some money, you can always opt to increase your ownership to whatever you can afford at the time. Just be sure to read the ins and outs of the scheme here, or better yet, speak with your mortgage adviser.
If you’re looking to move home, remortgage, rent out a property or buy for the first time, then you could benefit from speaking to an adviser at The Mortgage Hut.
We can offer both face to face and over the phone appointments; whichever is most convenient to you. Contact us today
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