With rents rising what is your advice to young(er) people

Journalist: Samantha Downes, Currently at the i (freelance)

ended 28. April 2022

For the i - news tomorrow

Flats saw biggest quarterly rise in rents since start of pandemic, amid tenants’ return to London, according to The Deposit Protection Service (The DPS)Average UK rents have increased for the sixth consecutive quarter, according to The Deposit Protection Service (The DPS), whilst also producing evidence that some tenants are paying above the going rate to secure a property.The UK’s largest protector of deposits, which safeguards 1.8m rent securities, says that average rents now stand at £849 a month: a £15 (1.80%) increase on £834 in Q4 2021, and a £49 (6.13%) increase on £800 in Q1 2021.According to the organisation’s quarterly Rent Index, London rents have risen the most in value, increasing £34 (2.46%) on Q4 2021 and £90 (6.79%) since Q1 2021.

My questions: Can this continue? What can young people do? What happened to the move away from London/downsizing. Thanks in advance

8 responses from the Newspage community

"We are noticing rent increases across the country, even in the North West, not just in London. Just like every other sector, our landlord clients are seeing an increase in operating costs that need to be covered. House repairs and renovations are costing more due to materials going up and builders increasing their costs. Inflation is becoming a real issue, with rents rising along with everything else. In my opinion, home ownership is better financially, if you can get that first deposit together."
"Raising rent on young people and families simply cannot continue at a time when people are being stretched in every which way as wages stagnate and prices rise. With properties being hoovered up by landlords, the financialisation and commodification of the basic and simple public good of having a place to live moves further away for an entire generation. The UK economy is creating a rod for its own back as it fails to address the housing crisis. In the interests of our own self-preservation, it would be wise to remember two quotes from famous thinkers with beards, namely Aristotle and Karl Marx: Poverty is the parent of revolution and crime and capitalism contains the seeds of its own destruction."
As a young person who spent over £60,000 in rent over 4 years I would definitely look at saving every month, putting a deposit down and trying to buy a house rather than wasting 50% of what a house would cost in some parts of England. If you can't get into the property ladder for obvious reasons and you work remotely get a van, convert it and travel the world at least you'll get to enjoy and experience life, cultures and different areas and you'd still be better off than wasting your money on rent. We live in ''every man for themselves'' kind of times so why not do something that's worth more and enjoy life. Making someone else rich won't make you happy. Be the difference!
My questions: Can this continue? Rents are rising at a rapid rate and with interest rates and inflation rising landlords who have held rents will soon have be forced into rising rents in line with the rest of the market but something has to be done as families and young people are being stretched from pillar to posts with rising costs currently across the country. What can young people do? Young people who are looking to get any form of independence are being absolutely shafted by the powers that be firstly with not enough houses being built and not enough council houses being built to allow young people to leave the nest and live on their own the only choice they have is to pay high rents or try and save for a decade to then possibly purchase a home I feel their pain personally the only thing it's seems like young people can do is live like a monk and not have any outgoing which is impossible, so if you can live at home for a long as possible and save towards a deposit do it if you can't and have to rent maybe try and find a place that is a low cost which is a rarity this will mean you have to compromise on location which as young people we have to do more than ever before. What happened to the move away from London/downsizing. Anyone in the southeast or London will always be paying higher rents and higher property prices due to it being the capital and unless there is more encouragement to increase jobs across the country rather than being London centric as more and more jobs where being done remotely during the pandemic some companies chose to close regional offices and to only keep London offices open which puts a stop on anyone looking to move to a remote town.
Many businesses have called staff back into their offices, and city centre shops and restaurants are getting back to a semblance of normal. So it makes sense that rental demand for flats would pick up. But exorbitant rents are just another symptom of a wholly dysfunctional housing market, propped up by a lack of housebuilding and a huge overdose of cheap credit. Other than shared ownership or getting financial help from the bank of mum and dad, it's extremely difficult for young people to buy. They are simply priced out of many areas. The only glimmer of hope on the horizon is that property prices could fall quite soon. If I was a young person, I'd use the money saved on a deposit to go see the world instead. Maybe you'll find a country to settle in that doesn't treat the younger generation with such contempt.
Rents are not increasing due to landlord greed; the biggest hurdle to resolve is the supply and demand issue rather like the sales market right now. I am regularly experiencing multiple applicants for every property to let, many of whom are in a strong position relative to the property in a financial sense. I am having to limit viewings to a short burst of back-to-back's and, in many cases, the applicants themselves offer over the asking rent. This does not help the rental market, but is driven by tenants rather than Landlords. Many tenants are stuck in the rental market. Some are serial renters and that's from choice; indeed I know of landlords with good sized portfolios who rent themselves. In my area I do experience many applicants from London who seek the more rural life yet with strong transport links and connectivity. My fear for the younger generation looking to start on the property ladder is that with rents increasing the way they are, it becomes harder to save for a good deposit. However, when I purchased my first property it was tough to spend more than £50,000 to £75,000 as a first time buyer - I am now seeing first time buyers (in my area) spending a minimum of £300,000 for the equivalent! It could well be that the only option is for the lenders to be less cautious over lending again and accept far lower deposits.
The insatiable demand for property and the continuing lack of housing stock has for some time now turned the property market into a playground for the "haves", whilst the "have nots" have struggled to save for a deposit, a task made even harder during the current cost of living crises. This shortage has now hit the Private Rented Sector, driving up rents and making things harder for first-time buyers. Unfortunately, this looks set to continue as many decent, small-scale landlords turn away from a sector due to increasing regulation and tax changes, reducing supply further. Add into this the fact that the much-talked-about change in working and living patterns has begun to recede as people go back to the office and realise life in rural Britain, though fun at first, may not quite be for them, and the strain on the housing market becomes more acute. Young people face a tough choice, especially if they do not have access to the Bank of Mum & Dad, or even Gran & Grandad, of either compromising massively on where they want to live and looking in much cheaper areas, or living like paupers whilst saving every penny possible for a deposit. What is important, is that this race to own does not become all consuming, and enjoying life and maybe travelling the world, (pandemics permitting) should not be sacrificed entirely. A visit to a professional adviser and a medium to long-term plan that is more realistic could be put in motion, which could also provide some insight into some other ways to buy or types of mortgage borrowing that could actually open up some doors that have not been thought of previously.
Work hard, save hard, and take advantage of special schemes designed to assist first time buyers onto the property ladder. There are an increasing amount of specialist mortgage lenders providing creative and flexible ways that first time buyers can access the property market. As the Help to Buy London scheme draws to an end, property prices continue to increase, and wages lag far behind, we expect demand for specialist first time buyer services to increase.