Research from Paragon Bank has found that tenants’ desire to own a home starts falling from the age of 35, along with the propensity to save towards a deposit as tenants get older.
A survey of 2,000 tenants found that 72% of those in rented accommodation would like to own a property in the future. Those in the 25-34 age category have the greatest desire to buy a home, with 88% of tenants in this group saying they want to own a property in the future.
This falls to 70% within the 45-54 age group, with half of 55-64 year old tenants stating they want to buy a property. Only 34% of tenants in the 65 or age group want to buy in the future. According to UK Finance data, the average age of a first-time buyer in 2019 was 32.
The ability to save for a home also falls as tenants get older. 72% of tenants aged between 18-24 that want to own a home save regularly towards a deposit, with 71% of those aged between 25-34 saving regularly.
This falls successively for following age brackets: 58% for 35-44 year olds, 45% for those between 45-54 and 41% for 55-64 year olds. There is a slight rise to 43% of those aged 65 or over who want to buy a home saving monthly to do so.
Richard Rowntree, Paragon Bank’s managing director of mortgages, said: “Our research shows a strong desire to buy amongst younger tenants who will typically use rented property as a starter home before stepping on the property ladder. This cohort also is more able to save for a deposit, making their aim of buying a home more attainable.
“As tenants reach their middle-aged years, the desire to own a home becomes less pronounced, but so does the ability to save for a property. These tenants will typically stay in the private rented sector for a longer period, maybe for the rest of their lives.”
Paragon’s UK Tenant Report 2020 also shows that contrary to the perception of reluctant renters, over half of tenants (54%) state that renting either suits their current situation or that they enjoy renting. Reasons for that include not having to worry about repairs (48%), the flexibility to move easily (35%), great location (32%), being able to live in an area they couldn’t afford to buy (31%) and the property being perfect for them (22%).
Satisfaction with rented accommodation increases with age. 68% of over 55s said that renting suited their needs or they enjoyed renting, compared with 49% in the under 55 group.
Overall, the majority of tenants (59%) like they property they live in, although four in 10 think improvements are required. Over six in 10 (62%) tenants state that the property feels like home, even if they don’t own it.
Tenants also enjoy a strong relationship with landlords, with over half of tenants letting direct from their landlord and 39% letting via a letting agent. Overall, 68% stating that they have a positive working relationship with their landlord, 80% stating that their landlord is easy to contact, 65% report the landlord makes repairs promptly and 58% say that repairs are made to a good standard.