Know The Current Trends In Global Rental Housing
Expensive housing is pushing more and more people towards renting, and this has become a world-wide phenomenon. What exacerbates the situation is the fact that even rental housing is, by and by, becoming more and more unaffordable. Worse still ― the hardest hit by this factor are those at the bottom of the income pyramid.
Here are five trends of the global rental market that you should take note of:
The hardest hit
According to a paper published by Harvard's Joint Center for Housing Studies* last year, renting is more common among those with below-median incomes. In the Netherlands, for instance, over 80 per cent of households in the lowest income quintile were tenants.
Hard to afford
Across Europe and North America, rental markets of the US and Spain are among the least affordable. According to the Harvard analysis, unaffordability in the US, is " largely due to greater income inequality, to more limited housing assistance programs, and perhaps to a housing supply consisting of units that are larger and better-equipped but that are consequently more expensive”. Rental costs is substantially high in the UK and Canada, too.
The rising burden
Data by the OECD (Organization for Economic Cooperation and Development) show that in Croatia, Chile and Greece, about 70 per cent of the tenant population are overburdened by rent payments. By definition, households that spend more than 40 per cent of disposable income on housing are considered overburdened.
The findings of the Harvard's Joint Center for Housing Studies also show that about 10 per cent of all households in Italy live rent-free in houses which they do not own. While this numbers stands at about 1.8 million in the United States (two per cent of all households), Austria and Spain, too, have “large rent-free shares”. Many of the households that do not pay rents are offered residences by their employers. The others who do not pay rents include people living with their relatives.
With a little help
In France, more than half of all cash renters received housing allowances. In the UK, their share stood at 46 per cent. The Netherlands, Germany and Sweden also offer substantial assistance to those living on rent.
Last but not the least
In Germany, over 40 per cent of all households consist of people living alone.
*This report compares rental housing in 12 countries in Europe and North America, using individual records from household surveys.