Young people urged to consider renting

News Category: Marketing

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A homeowner culture is instilled in many Britons, but many should consider renting property from landlords and letting agents in the current economic climate, it has been suggested.

David Kuo, head of personal finance at money website fool.co.uk, said people who buy a property today will be carrying much more debt than compared to 20 or 25 years ago.

He explained that the average home is currently worth around £160,000 while a typical person's salary is £20,000, meaning property buyers have to take on a debt eight times the size of their income to get on to the housing ladder.

This comes in spite of substantial house price reductions since the economic downturn began - the average property price fell by 16.6 per cent between January 2008 and the same month this year, according to research by Nationwide.

Mr Kuo advised renting as an alternative to buying, but said those who become tenants should invest any savings they make and resist the urge to spend excess income.

He added: "Maybe young people feel they must own their own home but that mentality may have to change as there is no shame in renting accommodation."

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