Within 13 years the culture of ownership will have changed dramatically and people will simply not buy stuff the way they do today. That’s the conclusion of a contributor to the World Economic Forum, who has predicted that by 2030 we will no longer own “stuff” but rather rent it.
Ida Auken, a Danish MP and contributor to the forum’s Global Future Councils, suggests that in the future people will use her living room for meetings while she goes to work.
“Once in a while, I will choose to cook for myself,” she writes. “It is easy – the necessary kitchen equipment is delivered at my door within minutes… Why keep a pasta-maker and a crepe cooker crammed into our cupboards? We can just order them when we need them.”
It’s a bold prediction given that we’re widely accused of hoarding “stuff” right now. Countless magazine articles and self-help books advise people against the dangers of “stuffocation” and environmental agencies warn against our rampant consumerism.
Self-storage units were virtually unheard of 30 years ago, but now the industry is worth an estimated £440m, according to the Self Storage Association UK, and that’s just the major players – there’s also at least one start-up matching up people’s empty attics with other people’s stuff overspill.
Yet there is some evidence that the tide is beginning to turn. In fact, official figures suggest our obsession with buying “stuff” has peaked; data from the Office for National Statistics shows that the amount of stuff we buy as measured by weight fell from 15.1 tonnes per person in 2001 to 10.3 tonnes per person by 2013.
But if we aren’t buying items, how will we use them?
Ready, steady, share
The sharing economy, as it has become known, has been growing for several years now, especially within London and other large cities. The Office For National Statistics reports that the sector was worth £0.5bn in 2014, but estimates it will be worth as much as £9bn by 2025.
PriceWaterhouseCoopers goes one further, predicting growth of more than 30 per cent a year between 2015 and 2025. It says that the industry could be generating £18bn in revenues for the platforms by then and facilitating around £140bn-worth of transactions in the UK alone.
In the UK there are websites that allow users to share property, storage space, cars, designer clothes and handbags, power tools and more, and new start-ups spring up almost every week.
Research from Lloyds Bank has revealed that a third of people now use sharing economy services of some sort and one in 10 UK adults offers shared services. Holiday lets are the most common by far.
It found that, although this industry is still arguably in its infancy, growing numbers of people are supplementing their incomes this way; with annual earnings averaging at £411 for accommodation, £118 for a car and even £116 from renting out the family pet.
Anthony Eskinazi, CEO of JustPark, which helps users rent out their empty driveways, said: “Participation in the sharing economy shows no signs of slowing, and it’s easy to see why – it offers consumers cheaper, more flexible alternatives to traditional business models, while providing an opportunity to generate income from underused assets.
“For example, we connect more than a million drivers with thousands of underused parking spaces across the UK – helping motorists find a better deal on their parking, while allowing property owners to maximise the value of their spare land.”
Tim Downes, senior claims manager at Lloyds Bank Insurance, said that sharing allows owners to earn money and borrowers to save money, but cautions that it’s essential to have suitable insurance in place.
He commented: “The flipside to the benefits of a sharing economy is that so many have turned a blind eye to insuring their valuable, ‘money-making’ possessions should they become damaged or stolen. Anyone planning to rent out their homes, valuables, or a spare room should notify their insurer beforehand or they may risk invalidating a future claim.
“We would not recommend renting out potentially dangerous items such as garden tools unless the owners had the right type of insurance in place to cover for accidents and injuries that may result. If in any doubt, speak to your insurer.”
Fortunately, insurers are catching up with consumer demand for sharing. In February the insurer Admiral announced it would be supporting car sharing by offering short-term cover for as short a time as one hour and as little as £3.
Buying less, spending more
Interestingly, one phenomenon that’s already being noticed is that those people who are still buying big ticket items are increasingly spending more on a top-end model in order that they can rent it out more easily and make a return on their purchase.
Chaz Englander is co-founder of the recently launched rental website Fat Lama. It’s an online platform that lets users share their belongings with neighbours to earn money or avoid buying rarely used items, and it also insures items to their full value.
He says people are buying less but when they do, they’re buying better. “We’ve already seen users buying DSLRs and drones purely because they know they’ll be able to make their money back by renting them out on the platform – much like how people have started buying properties to rent on Airbnb over the last decade.
“This will, in turn, mean people will buy better quality stuff. By incentivising people to lend out their things, we’re speeding up the move towards a circular economy where products are repaired and reused instead of disposed of. Why wouldn’t you buy better quality items if they’ll pay for themselves?
“It’s another income stream for micro-entrepreneurs – freelance producers, photographers, musicians, DJs and more are in some instances doubling their monthly income.”
If the sharing economy is to be worth £18bn by 2025, then it will have to grow exponentially during the next few years. Even then, without a real transformation in how we view ownership, it is hard to imagine a world where we routinely borrow instead of buying just five years after that.
However, as the last few years have shown, disruptive technology can lead just such a transformation almost overnight.
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