Is there a way out of the UK housing crisis? Lately, the government seems determined to provide solutions.
Getting on to the property ladder has never been more difficult according to many agents and experts, especially the younger generation. Renting has become the norm for millions of people in the UK and especially in London. The lack of new homes and the rising house prices created Generation Rent, as they call it. Millenials with low income or in search of a job, prefer co-living to split the cost to get by.
Young people are heavily impacted by the lack of affordable housing options, especially those who do not have close family and friends to share the burden of home buying. Renters are often millennials, sometimes straight out of education, who find home buying an unattainable feat.
The recent axe of the stamp duty has increased the hopes and expectations of potential first-time buyers, however, there are many Britons who are unable to even get that far on the ladder.
Moving into a rental market after college or university in a city such as London can cost up to a staggering £3,000 since the average deposit in England and Wales is £1,041, while deposits in London are typically in the region of £1,750 since the average deposit is worth one month’s rent. With that information in mind, the government is banning letting agents fees paid by tenants from spring 2019 and onwards, while setting a cap on tenancy deposits at a maximum of six weeks’ rent.
Seb Klier, from Generation Rent, said: “The government has recognized that a cap on rental deposits is important, but set it too high. Even a month is unaffordable if you don’t have any support structure outside.” echoing the disappointment of those who expected the cap deposit to be limited to one month’s rent.
According to the Department for Communities and Local Government “This government is determined to make sure the housing market works for everyone. That’s why we’re delivering on our promise to ban tenant fees, alongside other measures, to make renting fairer and increase protection for people in the private rented sector.”
Generation Rent found that the average two-adult household is paying approximately £404 every time they move, with fees ranging from £40 to £813.
The ban could actually transform the housing game since the government appears to have committed to drastically improve the UK housing market.