The most striking result in the report is that the levels of home ownership decreased by a higher percentage in 2011 than in recent years, whilst the number of people living in the private rented sector again rose sharply.
The survey paints the picture of a private rented sector comprising 3.8 million households with an overwhelmingly young (more than half of private renters are under 35 compared to just 10% of owner occupiers) and rapidly moving population, paying an average of £160 a week rent.
However, the report also suggests that people in the private rented sector are much more likely to experience overcrowding than owner-occupiers. It revealed 6% of rental households are overcrowded compared with 1% of owner-occupiers, although the social rented sector has the highest level of overcrowding at 7%.
In addition, the number of private rented homes not meeting the decent homes standard remained largely the same as in previous years at 37%, so it looks like now is a good time to start focusing on renters.
Home ownership is so deeply ingrained in the nation’s psyche that it may take everyone a little while to get their heads around this shift, but policymakers take note: this is a trend that is here to stay.
Why this shift is taking place is open to debate. One thing is certain, it is not simply a reaction to the credit crunch; this trend started in 2003.
Is it the fact that house prices outstripped earnings growth in the early part of the 21st century?
Is it a change in mindset of generation Y choosing to take advantage of the flexibility the private rented sector provides in terms of location, property type and short renewable tenancies?
Are people concerned with volatile house prices?
Or is it the fact that, for many people, raising a deposit in the current climate is too tall an order, so they are left with little option?
It is likely that there is some element of truth in each of these statements.
The government’s housing strategy, published late last year, spanned nearly a hundred pages, of which few were devoted to the private rented sector.
If the decline in home ownership is set to continue, it raises serious considerations for government and society in general.
We will need a joined up, coherent and innovative approach by government and industry in order to bring investment to build new houses for rent and improve the condition of the current stock.
Paul Broadhead is head of mortgage policy at the BSA
