According to data produced by the Resolution Foundation, the number of people who own their own home in London has fallen below the number of renters.
Since the early 1990s, the number of people in London with a mortgage has been steadily falling, and is now lower than those who rent a property. The number of private renters has increased since the nineties, from 20% when John Major was prime minister, to 30% today and the steady increase is set to reach 40%. According to a forecast by PricewaterhouseCoopers, 60% will be renting in the Capital in less than 10 years.
Analysts from Resolution Foundation have discovered that many homeowners in the Capital are struggling to keep on top of payments. Ideally, the maximum amount spent on keeping a home is one third of an individual’s income. Around one third of Londoners spend more than that on housing, indicating serious difficulties.
However, although many people are struggling in London to buy their own homes, others are profiting from the increased demand for rental properties, as property prices continue to push home ownership beyond the reach of many. One estate agents, Cluttons, has predicted that the cost of renting will rise 16% due to the rising numbers of renters in London.
For many people, buying a home involves saving for a reasonable deposit, which may prove difficult as the cost of living continues to increase in London. However, with many government schemes available to help first time buyers, it may be possible to step onto the property ladder. A CeMAP trained mortgage adviser can help buyers to make the most suitable decision when buying their own home.
