Is owning a home becoming an impossible dream?

http://www.bbc.co.uk/news/business-32758907

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Thirty-year-old Matthew Carpenter had a dream, a dream which he may never fulfil.

"I dreamt of a two-bed house, with a small garden, somewhere to put a barbecue," he tells me.

But Matthew has given up on buying his own home. Half of his pay goes on renting a one-bed flat in London, and he can't save for a deposit.

His frustration is shared by millions. But in the long run could it put a dent in our love affair with buying and owning?

Most of us want to have our own place, to watch the value increase and avoid paying a landlord.

Instead we live in an age of reluctant renters, people who fantasise about buying but simply do not have the wherewithal, at current prices, to purchase what they want.

'Nation of renters'

Hence the attention given to the government's Help to Buy scheme.

But NOT owning could become the new normal for many, something we will get used to and even like.

Housing associations are beginning to plan for a future which requires mass provision of new rented homes, a future in which fewer are consumed by the urge to own a property.

"We are becoming a nation of private renters," says David Montague, head of a leading housing association, L&Q. "They'll have children and the children will grow up in private rents and they will know nothing different."

The figures for home ownership don't prove this, yet. Nearly 18 million homes are owner-occupied and around 10 million rented. But the totals are shifting, the proportion of renters increasing year after year.

Which is why it is so interesting that L&Q is launching one of the biggest blocks of flats to be offered only for rent and only at market rates, part of a plan to build 5,000 new homes a year.

The new complex, Thurston Point in south-east London, will have 238 apartments, starting at £1,050 a month for a studio.

For those who have been calling for a return to large-scale council house building to solve our housing crisis, it is important to understand that these flats are something completely different.

The rents will match those charged for equivalent properties from private landlords, so they could be beyond the reach of some families.

On the other hand, by building thousands of properties like these to let out or sell, housing associations can use the gains to subsidise social housing which can be rented at a discount of 20% or more.

Pension funding

Some people have already had enough of owning their own homes, like Ross Longbottom who sold his flat to raise money and now rents from L&Q.

"I'm sceptical about getting back on the housing ladder," Ross tells me, "I'm comfortable, not having all that responsibility."

Councils in Manchester are deploying pension money to do a similar job.

They have used the Greater Manchester Pension Fund, the biggest local government fund in the country, to back the development of 250 houses, half of them to be sold and half rented at market rates.

The first, in Wythenshawe, are just coming on the market. Hundreds more are planned.

The leader of Manchester's Tameside Council, Kieran Quinn, has had pension funds from around the UK asking for advice on doing the same thing. They are attracted, he explains, by the prospect of a stable return from long-term tenants.

"In the long run, pension funds could easily deliver 2,000 new homes a year," he predicts.

Aspirations

The desire to buy a home is still firmly entrenched. The British Social Attitudes Survey shows that 86% of the public would rather buy than rent, given a free choice.

The reading has been remarkably consistent over the years, with the latest one showing that 85% in the 20-45 age group want to own their own home.

"The aspiration is still there," says David Montague from the L&Q housing association, "but over time it will change."

Matthew Carpenter agrees. He has shaken off the home-owning dream.

"For me renting is not terrifying," he says, "I have lots of friends overseas who rent and their parents rent too."