In an analysis of official housing data published earlier this week the trouble faced by tenants is highlighted again. The information from the office for National statistics which covers the years 2010 to 2012 tries to look at the standard sums paid for housing in the form of either rent or mortgage. It shows that the average mortgage costs during that period rose by 6 pc while the average rent paid rose by 12 pc from an average £130.80 to £138.60 and £121.50 to £136 per week respectively.
A group known as Lobby group Pricedout extracted the information from the ONS data in which the results imply that the average homeowner will pay less compared to the average tenant. In addition, the average tenant will not even experience any benefits when the prices of property go up. The spokesman of the above group Dan Wilson Craw said that homeowners paid less in mortgages as compared to tenants who were required to pay far more in rent as a percentage of income.
He also went on to say that with the rent increasing greatly at a higher rate than income then how is one required to save for a pension and a deposit on a house while at the same time enjoy an increase in the living standards? He then added that the trend in the housing market is worsening therefore leaving many people struggling over a limited number of houses.
The shortage of homes, which has led to rents being pushed up has mainly been caused by the recovering economy. Additionally in the year 2014 the price of houses is expected to continue to rise and this will make the tenants who would wish to buy a house face another depressing year. The government’s initiative dubbed Help to Buy will start officially in the year 2014 but the manner in which this will help is yet to be seen in some parts UK.
Although mortgage lenders have tried to make it less strict on prospective borrowers, most usually need either large deposits or a high income to loan ratio hence locking out low income earners. In areas such as London the prices of property are so high that when the lending requirements are applied, then most people stay excluded from the market.