Housing market: Affordability is 'biggest tenant concern'

  • Published
HousesImage source, PA

Two-thirds of UK tenants still expect to be living in the rented sector in three years' time, with affordability their biggest concern, a survey says.

Estate agency Knight Frank estimated that 5.79 million households would rent from a private landlord by 2021, up from five million now.

That increase would include pensioners, as well as young adults, it suggested.

While many are saving for a deposit on a house, a third of the 10,000 tenants asked said they rented through choice.

Of these, the flexibility of renting and the reduced responsibility were popular. A fifth said they chose to be tenants as it allowed them to live in an area where owning a home was unaffordable.

"The number of people renting out of choice rather than due to affordability of ownership constraints is an interesting indicator of how the private rented sector market will continue to thrive in terms of tenant demand," said Tim Hyatt, head of residential lettings at Knight Frank.

The estate agency expects big investors to move further into the rental property sector, replacing some buy-to-let landlords who have been hit by recent tax rises.

The average cost of a house or flat in the UK is now £220,706, according to the latest property price survey from the Halifax.

The Knight Frank research found that across the rental sector the biggest group of tenants was those seeking to save up to buy their own property.

The affordability of rent was the biggest consideration, for them and other tenants. Location was the next biggest factor - a much larger concern than the size of the property itself.

Across the UK, more than half of commuters live within a 30-minute journey from work, while in London, this falls to 31%.

Not just youngsters

The estate agency forecast slightly faster growth in the number of households made up of under-25s who rent, but that there would also be a rise among the baby-boomer generation as well.

This echoes a separate survey published on Monday by lettings network Countrywide which suggested that retired people now accounted for 8% of tenants, compared with 5.2% in 2007.

It said that the average retiree paid £810 a month in rent, about 12% lower than the typical tenant, with people in the older age group tending to live in smaller properties,

Where can I afford to live?