AN extra million households will be forced into rental accommodation over the next five years as rising home prices out lock potential buyers out of the property market, new research warned today.
Property consultant Savills said 200,000 more households a year in the private rented sector would also push up the cost of tenancies by 21%, hitting the ability of families to save up for a deposit. The biggest group of private tenants is aged between 25 and 34, but the fastest-growing group are between 35 and 44, a quarter of them having young families.
Many of this “Generation Rent” — earning too much to qualify for state support but too little to get on the housing ladder — will never own their own home, Savills warned.
Around 200,000 potential first-time buyers have been shut out of the property market by the credit crunch since 2009, it estimates.
The estate agent adds that the Government’s Help to Buy scheme would have little impact on these excluded families, as the average income of most of these households is below the £45,000 average of those currently taking part in the initative. Savills meanwhile predicts a 25% rise in house prices over the next five years.
Savills’ Susan Emmett said: “Although the property market is strengthening and mortgage availability is improving, many households are being left behind. The new excluded are unlikely to qualify for social housing yet their incomes are not high enough to take advantage of the market recovery.”
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