The majority of the UK’s private renters don’t want to purchase a home according to new research, coming just as the Labour party is considering giving tenants the right to buy.
Landbay, the specialist buy to let lender, says only 42 per cent of private tenants want to purchase. The study is based on a survey of 2,000 private renters in the UK.
Older renters are the least interested in buying a home: only 13 per cent of over 55s want to purchase in the near future. Even amongst those tenants aged 35 to 44, only 46 per cent want to buy. However, some two thirds of millennials aged 25 to 34 want to buy soon.
There is also a notable gender discrepancy with 47 per cent of women across all age groups keen to buy a home, compared to just 34 per cent of men.
The number of people planning to buy is highest in London, at 48 per cent, and Northern Ireland at 47 per cent. Those in the South West and Wales are least likely, both coming in at 37 per cent - despite the relatively lower house prices in these areas.
For those content to rent, the flexibility of the tenure is seen as positive. A quarter of renters without home ownership aspirations say the flexibility of renting is the key attraction.
“Conversations around the private rental sector often assume the bulk of renters are simply biding their time until they can buy a house. However, the changing face of employment and a thirst for flexible living mean renting is more attractive than ever, and landlords should reflect this in their interactions with tenants” explains John Goodall, chief executive of Landbay.
“It’s crucial that investment in the private rental sector becomes a priority. What use is Labour’s ‘right to buy’ policy if renters have no interest in doing so? Instead the government must focus on encouraging purpose-built rental properties and cease its penalisation of landlords.”
Although Shadow Chancellor John McDonnell made no reference to the idea in his keynote speech to Labour’s conference yesterday, earlier this month he told the Financial Times that private renters ought to be able to have the right to buy their home - even if the landlord had not put it on the market.
“You’d want to establish what is a reasonable price, you can establish that and then that becomes the right to buy … You (the government) set the criteria. I don’t think it’s complicated.”
Landlords failed to reinvest in properties and had made a “fast buck” at the cost of the community and their tenants, McDonnell argued. “We’ve got a large number of landlords who are not maintaining these properties and are causing overcrowding and these problems. In my street now, a third of the houses are right-to-buy, badly maintained, overcrowded; it’s horrendous” he insisted.