The survey results are based on fieldwork carried out between April 2011 and March 2012 with a sample of 13,829 households. The private rented sector has been growing in recent years, and is at its highest level since the early 1990s, equalling that of the social rented sector at 3.8 million households. In 2011-12, around two-thirds (65%) of households were owner occupiers.
Average weekly rents in the private rented sector continued to be well above those in the social rented sector (ÂŁ164 per week compared with ÂŁ83). While mean rents have increased in both sectors since 2008-09, private rented sector rents showed no significant change from 2010-11. Almost two-thirds (64%) of households in the social rented sector were in receipt of Housing Benefit, compared with around a quarter (26%) of those in the private rented sector.
The level of home ownership has fallen to its lowest level since 1987, the survey figures showed. The vast majority of households are home owners, making up 14.39 million, but this 65% of all households is the lowest proportion recorded since the height of the popularity of the “right to buy policy”, when council tenants were encouraged to buy their homes at a discount. During the 1980s, the level of home ownership rose from 56.6 per cent to 67 per cent but it went on to peak at 70.9 per cent in 2003.
It is believed that the rapid increase in the cost of property in the run-up to 2007, coupled with a subsequent reduction in the availability of credit, has subsequently priced millions of would-be buyers out of the market.
There have been some recent signs of improvement to the mortgage market following the introduction of the Government’s Funding for Lending scheme in August 2012, which has given lenders access to cheap finance to help borrowers.
A number of lenders have slashed their rates and the number of mortgages on the market has increased since the scheme was introduced. The Bank of England has reported uplifts in mortgage approvals to home buyers in recent months, although analysts have pointed out that the figures are still low compared with longer-term norms. First-time buyers also still need to find a deposit of around 20%, compared with the mid-2000s when a 10 per cent deposit was typically put down.
In 1961, there were 3.2 million households living in social housing, while 4.7 million lived in the private rental sector. A decade later this had been reversed and by 1971 there were 4.6 million families living in social housing compared with 3.2 million who were privately renting.
Shelter recently produced a report which argued that the private rental sector has outgrown its role in primarily providing accommodation for students and young professionals. The charity said that families have become stuck in the “rent trap” as rents have soared due to strong demand, which has left tenants with little cash to be able to save for a mortgage deposit.
