More than half of the under-40s will be renting by 2025, home ownership will drop to about 60% and the number of households renting privately will rise to 7.2m
The forecasts come from accountancy firm PwC, which says the pain for younger people will worsen within five years.
Seb Klier, of Generation Rent, last evening told Channel 4 News that there could be “radical action” ahead. Protesters angry at the cost of private renting and being squeezed out of home ownership could show their anger through rent strikes and vigorous opposition to evictions.
PwC says house prices will rise at an average rate of 5% a year, putting the average house price at £360,000 by 2020.
Based on first-time buyers needing to find a deposit of 18%, that would mean having to raise a deposit of £64,800 to get on the housing ladder in 2020.
PwC also says that the contrast will become more marked between the young – who are unable to buy – and the old, many of whom will own their homes outright because they have either paid cash or paid off their mortgages.
The firm predicts that the number of homes owned outright will rise from 8.4m now to 10.6m by 2025, equating to 35% of the total.
Richard Snook, senior economist at PwC, said: “Driven by a decade of soaring house prices before the financial crisis and lower loan-to-value ratios post-crisis, the deposits needed by first-time buyers have risen significantly.
“As a result, a generation of private renters have emerged and this will increasingly be the norm for the 20 to 39 age group.”
“Seb Klier, of Generation Rent, last evening told Channel 4 News that there could be “radical action” ahead.”
Sounds like GR are trying to make news happen…
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PeeBee he means there needs to be radical action taken if the existing problems are to be resolved.
Forecasting ‘doom’ in the UK housing market, though potentially useful, does not actually solve anything. Merely citing the recent research by PwC into house price levels is one thing but to resolve the accelerating crises requires significant work on the infrastructure of the housing market itself.
For example take our nation’s road system. If we want to move increasingly large numbers of cars efficiently around it appropriate road improvements are a fundamental requirement.
The same goes for our housing market. If we want to be able to market and transact sales of increasingly large numbers of houses (to cater for our ever growing core population), improvements in the efficiency of the UK housing market itself are desperately needed and long overdue. Full concentration on the planning and executing of these improvements is absolutely essential to this.
Thinking we can leave it to the market itself to sort out these problems is simply taking the ‘road’ to failure !!
The politicians and their advisors keep kicking these problems back into the long grass instead of trying to deal with them head-on but I have to ask and keep asking, why?
To read information on the only way to achieve due success in dealing with the current housing market problems and helping countless numbers of households to live a better life in the process, refer to the previously published (but little known or commented upon) “Hendry Solution”.
<a title=”Peter Hendry” href=”http://www.property-match.co.uk/blog/2013/12/05/estate-agents/want-functional-stable-housing-market/” target=”_blank”> Earlier article published on our blog site</a>. This gives full details of our set proposals for resolving the price inefficiencies within the UK housing market.
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Well, well, well – welcome back from your hibernation, Mr Hendry.
Pity it obviously didn’t clear your head of all the nonsense…
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With respect Mr Hendry your departure was because you kept posting links to your blog, in your very first post here you are doing the same.
If yours is a notable work on the subject someone will find it, no need for an advert.
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Said it before and i will say it again (until i am blue in the face).
The only way to tackle rising house prices and to home more people is ………. BUILD MORE HOUSES!
I really do not see why more people do not grasp this!
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Peter, I notice from your blog that that you are now ”Peter Hendry, Consultant in Housing Valuation”
Congratulations on the promotion.
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Hello PeeBee,
I’ve come back because it seems nothing worthwhile has been done to resolve the looming crisis to which I was referring before, namely the increasing difficulty facing those wishing to buy average sized houses using average income-earning ability in their specific localities and, its not simply a question of building more houses! If it was, there would be a near normal level of completed sales currently. There is not, so something else is going wrong with the operation of the housing market. I am explaining what’s going wrong, why it’s going wrong and what needs to be done in order to fix the specific problem which is causing the UK housing market to stagnate in terms of sales overall volumes. This stagnation, by the way, adversely affects estate agents themselves so the reasons why this is happening should be of particular interest to estate agents themselves.
And before you say it, whilst I’m happy to make a comment on the main article for the benefit of other readers I’m not willing to be tethered to my keyboard to engage in live debates of your choosing on the validity (or otherwise) of each of my own comments. I feel they are perfectly clear, concise and complete in their own right. Thank you.
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Its simple more house = more supply = more supply = less demand = lower prices.
It really is that simple!
Anything else, as others put is “Bullshut”
Too many people, too few homes drives property prices and rents up.
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By the way my ego needs stroking i will call the the “Smile Please Solution”
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Fingers in ears and thumbs in eyes – won’t make the problem go away.
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It’s not even very comfortable to attempt to stick “fingers in ears and thumbs in eyes” as you suggest, Mr Hendry – however compared to the act of firmly inserting one’s head where yours has clearly been solidly lodged for several years, it’s flippin’ easy-peasy lemon squeezy!
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“I’ve come back because it seems nothing worthwhile has been done to resolve the looming crisis to which I was referring before, namely the increasing difficulty facing those wishing to buy average sized houses using average income-earning ability in their specific localities and, its not simply a question of building more houses!”
No – you just saw an opportunity to cut and paste the latest negative spin hot off the press from your woeful blog, and a full seven minutes after you posted it ‘down the other pub’ on EAT!
One thing about you, Sir – is your transparency (no doubt unintended). Or simple blatant nerve for anything – not sure which.
I’ve always been pulled toward the latter.
Whilst you are perfectly free to frequent whichever pubs you choose, I would have thought that you would stick to that other pub – seeing as I don’t go in there any more, I won’t be chewing at your ankles there and make you spill your pint of p!$$water all over your jumper.
They’ll like you down there. You’re funny.
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Rummage before you post young man! the ‘Hendry solution’ has been hawked about for a while now.
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Robert – I would say that I’m almost (for all the WRONG reasons…) an authority on ‘The Hendry Solution’. ALL of them, in fact – the ‘solution’ seems to be fairly fluid dependent upon the way the wind blows it…
I’m actually referring to his latest blog dribble dated today, Robert – which some might say was clattered together slightly after the eyes opened… but well before the brain engaged.
You don’t even have to Rummage4 it – the bu99er’s copied almost verbatim up above here in the second post off the top!
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This latest one appeared in March as a blog link comment in the Western Morning News.
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PeeBee, I genuinely do not know why you should be up tight about me saying the same thing on/in all three pubs! It’s my story; which I fervently believe ought to be broadcast – so I’m putting it about in the relevant pubs.
It’s a reaction to what’s in the newspapers, right now, about the state of the UK housing market – which ain’t looking too good.
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Forgive me for saying but its c**p!
Its a load of drivel written by somebody trying to be an authority and failing.
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Mr Hendry – I couldn’t give a fuppeny where you post your MDT – I simply pointed out to you that down the other pub you can spout all you want without me gnawing at your ankles.
HERE, however – welcome to my gnawing ground!
Even though you’ve been quiet lately you seem to enjoy it, so it would be rude not to.
Funny old world… takes all sorts dunnit!
By the way – talking of chewing – no bites yet for your domain?
Maybe – just maybe – this mirrors your stated opinion of what is happening in the market and the quoted price is “…far outstripping average buyers’ resources…”. Now THAT would be a turn up for the books, wouldn’t it?
Especially as I find that something priced right always sells – REGARDLESS of how much rot it contains…
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It was announced earlier in the week that the Govt plan to sell off some of the MOD land to create 150,000 homes and raise money for the exchequer.
Well that’s all well and good just as long as they actually start the work now and not sit on the land. Perhaps a proviso of each sale is that work must be completed within a set time from purchase with the planners being less restrictive on approval for former MOD land.
Also good to see some new incentives such as the tax brake for those renting out a spare room, but we need to see more stuff like this if we are going to stand a chance of sorting out our housing problem.
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For those of you that have not previously had the ‘pleasure’ of Mr Hendry you need to know that he does this – chucks a lit firework into the room and runs off giggling like a demented hyena at the chaos he thinks he’s caused.
Unfortunately, you get used to him in time.
Like piles.
Only less comfortable.
But definitely more embarrassing.
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Only making himself look silly.
All you have to do is take one look at the blog and know he is several rounds of sandwiches short of a picnic.
A lit firework is dangerous, he is more like a child running and screaming around a room trying to imitate a firework.
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