Tenants are spending half their salary on rent
Financial services innovator, Momentum UK, have reported that the average private renter is worse off than someone with a mortgage. Tenants tend to save less, make more cutbacks and go on fewer holidays than the average home owner.
Momentum UK’s Index claims that 31% of tenants have less than £100 in savings compared to 15% of home owners. The report also suggests that people with a mortgage are twice as likely than private tenants, to feel their income is sufficient.
Tenants are currently spending approximately half of their salary on rent each month, with one in five having to make cutbacks on food to get by, compared to one in ten mortgage borrowers. 60% of private renters currently do not have a pension, compared to just over a quarter of mortgage-holders.
Recent figures suggest home ownership is falling with more than four million households now renting their home from a private landlord. Home ownership in England dropped to 62.9% last year, the lowest since 1985.
Dominiwskc Baliszei, Director of Consumer Strategy for Momentum UK, said: “The average private renter loses around half of their pay cheque on rent at the beginning of each month, and for those living in London, it can be even higher. This not only limits their ability to save, but also means they have to cut back on expenses such as gym memberships, holidays and socialising just to get by.
With home ownership in decline, the number of people facing these financial challenges and seeing their living standards fall is only going to grow. That’s why it’s so important that the government delivers on the pledges made in its housing white paper. For those who have only recently moved into private rented accommodation and are not used to living on a budget, there are now apps and online tools available which can help to make your money go as far as possible.”
Full article available on Property Reporter: http://www.propertyreporter.co.uk/landlords/new-research-reveals-the-life-of-generation-rent.html