Comments : Were you born after 1979? You could be trapped as a lifelong renter

Posted: 05/03/2012


If you were born after 1979 and not currently on the property ladder, you could find yourself renting properties all your life as it is becoming increasingly difficult to afford your own home. Recent studies show if you’re 33 and older, you’re more likely to already be on the property ladder, however those who are 32 and younger will be more commonly living in rented accommodation. This is due to the massive struggle in affording a deposit on a property and earning enough to secure a satisfactory sized mortgage to get onto the first step of the property ladder.

I found a typical flat in Wallasey that is currently on the market and realised that if I only had 10 percent of the deposit then I most likely wouldn’t be able to get a mortgage high enough to purchase it. The trouble is, this flat is far from a luxury penthouse on the Albert Dock; it has a motor way as the view from the back window and is only a fraction larger than a shed, typical of many first-time buyer properties in the area.

It seems that people with above-average salaries will be the small percent who can afford to buy their own home, everyone else, which is potentially 60 to 70 percent of the population, will have to live in rented accommodation. The down falls of living in rented accommodation rests with the landlords and their rules. There is no rent control in place unlike in Germany, where the government cap the rent to stop it from rising above and beyond what people can afford. German tenants also have the right to remain in a property for as long as they wish, providing they have lived there for over six months, keep the property in good condition and pay their rent on time. Surely this would be a fairer option for our tenants? It seems not, as it would be classed as anti-free market.

To think that tenants can be thrown out with only a few weeks to find a new home is disturbing. There has been a 17 percent increase since 2007 of tenants being treated this way, this includes teenagers, citizens in their twenties or early thirties and parents who may have to change their children’s school.

However, what we can hope for is a reform to the short hold tenancy regime, where landlords and tenants can agree longer term deals to help with the rent increases, say inflation strikes again. Unfortunately, there is a hefty road block jamming any reform in this area, due to the rights of leaseholders tackling their managing agents.

To simplify; since 1979, tenants have been at a major disadvantage and something needs to be done about this pretty soon before the majority of the population will never experience the proud feeling of owning their own home.

Amanda McGovern, Pali Ltd

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masom says ...

‘A short sale means the current ekmart value is not enough to pay off the mortgage on the house. For example, if someone bought a house in 2006 for $400k with $50k down payment and a $350k loan. Now they still owe $345k but the house is only worth $200k. When the house sells the bank gets all the money from the sale but there's still $145k of loan that isn't repaid. The seller's mortgage bank has the right to reject the sale since they are not being paid in full. Sometimes they'll forgive the outstanding debt or set up a payment plan for the sellers to pay the difference. Either way, it causes a headache for you because you have to wait around for the bank to approve or reject the deal (which can take months). Also, be sure you have a good title company who insures the transaction against all liens. All mortgage liens need to be removed before you take possession. You want a company who will make sure that happens, and insure the transaction in case they miss something.’

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