Renting: what’s not to love?
We still haven’t taken a leaf out of Europe’s books when it comes to attitudes to renting but even Boris’ fixation with buying shouldn’t detract from the merits of moving into rented accommodation.
When the Prime Minister declared in the autumn that he wanted to create Generation Buy with the re-introduction of 5% mortgages, he revisited a promise that was part of the Conservative’s 2019 manifesto. The pledge was aimed squarely at first-time buyers and feeds into the image that all tenants are outraged home-owning hopefuls, thwarted by the system. It also reinforces the notion we’re obsessed by wearing home ownership as a badge of honour.
Tenants, however, are not an underclass, nor are rental properties inferior to anything sold on the open market. Many home movers chose a rental property over and above buying – Viewber’s founder Ed Mead is one of them, as he detailed in his article for The Spectator.
Tenants and their wellbeing are more protected than ever before, with tight regulation and a robust compliance system for all-round peace-of-mind. There’s a lot to gain by being part of Generation Rent, as Viewber explains.
Low set up costs: with the latest figures from Zoopla pitching the average price for a property in the UK at £308,813, a 10% deposit now equates to more than £30,000. In contrast, the average UK monthly rent, according to HomeLet’s September 2020 Rental Index, is £987. With a deposit cap set at five or six weeks’ rent, holding deposits capped at one week’s rent and a ban on tenant fees, securing a rental property will generally involve an outlay of around £1,381. Don’t forget, there are also a growing number of deposit-free schemes allowing tenants to move into a rental property with drastically reduced costs.
No ‘black cloud’ of debt: figures from the Office for National Statics found Great Britain’s property debt (mortgages and equity release) stood at £1.16 trillion between April 2016 and March 2018. Renting is a liberating choice for those who dislike the idea of being part of such a huge figure. Renting also banishes the worry of negative equity, which has started to creep into conversations – especially with the Prime Minister’s 5% mortgage plan and predictions of a choppy housing market ahead.
A ready-made lifestyle: as we detailed in a previous blog, the Build to Rent phenomenon is giving rise to a way of life that was previously reserved for owner occupiers. The likes of Quintain, L&G and Grainger are building new communities exclusively for tenants, where gyms, cinema rooms, rooftop swimming pools, concierges, private dining facilities and work-from-home hubs are part of the package.
Freedom or security – your choice: renting a property offers flexibility that owning a home can never match. From short lets that suit professionals on contracts to long-term tenancy agreements running for up to five years, the market is rich with choice. In fact, a tenant is actually free to negotiate any length of agreement with the landlord.
The path to a richer retirement: renting is increasingly becoming a rewarding option later in life, with many selling the property they live in to release equity – perhaps to top up a pension, gift to family or fund a new lifestyle. An article by the Buy Association packed full of pro-renting statistics highlighted how 34.7% of over 55s find renting the right choice for their lifestyle. Additionally, around a quarter choosing to rent said they didn’t want to maintain a property and a similar number did not want a mortgage.
Try before you buy: whether it’s an escape from an urban area or a new-found flexibility to work from home, people are seriously looking at relocation. Around 64% of Savills’ regional letting agents have seen a rise in ‘try before you buy’ movers – those who want a low-commitment way to sample an area - perhaps renting for between 6 to 12 months to see if they like an area before the make the leap to buying.
If lettings features in your future plans – whether you’re an agent, tenant or investor – get in touch with Viewber for accompanied viewings, property reports and digital capture services.