Generation Guppie – are you giving up on owning property?

Zoopla uses the term Guppie to refer to “young people, many of whom have professional careers and big salaries, who have ‘Given Up on Property’ and in a recent Zoopla survey 42% of adults aged 18-39 who don’t own a home say they’ve given up on the idea of buying one in the next ten years, including 38% of those earning £60,000+. 

The Zoopla survey looked at 2,000 people under 40 and found the following; 

• More than four in ten (42%) British adults under the age of 40 who do not currently own a home are now considered Guppies. And this is very different from the  ‘Yuppies’ of the Eighties and Nineties – who were young urban professionals with a good salary and no issues buying a home.
• Even among people earning over £60,000 per year, 38% have given up on affording a home in the next decade.
• Overall, just one in five (21%) say that they will ‘definitely’ be able to afford a home in the next decade, while 14% are currently planning to buy one, or are in the process of doing so.

The current UK housing situation for Under 40’s

The vast majority of Brits under the age of 40 in the UK do not already own a home – just 22.5% of those aged 25-34 and 1.4% of those aged 24 or under are homeowners.

In fact, there is a larger % of non-home-owners under 40 in the UK who are now more likely to be living with their parents, than be planning to, or be in the process of, buying a home (14.4% vs 14.1%).

What are the reasons for giving up on owning a home for the foreseeable future? (10 years)

The survey showed three main reasons;

1. The cost-of-living crisis (64%)
2. Increasing house prices (51%)
3. Higher mortgage rates (49%)  

And moreover, of people planning to buy or who are in the process of buying their first home, 85% say they have made financial sacrifices to do so. And over a third (34%) have given up holidays, and 30% have had to give up socialising.

A quarter (25%) have stopped saving for their future and one in ten (10%) have even given up dating or being in a relationship in order to afford a home.

What are the reasons other than financial to opt out of home ownership right now?

As Estate Agents, especially local, High St agents, we know it’s not always about the money and we’ve definitely seen a pushback to the traditional viewpoint of home ownership over the last 10 years, and some very creative solutions financial and otherwise to getting on the property ladder.

Renting is now cheaper than a mortgage

Renting is now cheaper than a mortgage for the first time since 2010 due to higher mortgage rates. Zoopla also found that “The typical monthly rent is now 9.5% or £122 cheaper than the mortgage repayments for the same rental property”

Some of the key reasons people choose to continue to rent rather than own a home;

• Flexibility - renting provides the flexibility that homeownership often lacks. This desire for flexibility is also influenced by a changing job market. Many young professionals expect to change jobs and potentially careers and move around multiple times throughout their lives. Renting allows them to be more agile in pursuing career growth and taking advantage of new opportunities in whatever city they choose.  
• Lifestyle Choices and Experiences – renting can allow you to allocate finances towards other aspects of your life, prioritising experiences and a fulfilling lifestyle over being tied down to property ownership. The freedom to spend money and time on travel, leisure activities, and personal growth.
• Location - renting provides the opportunity to live in desirable areas, in a great community with a wide range of amenities.
• Minimalism – it can be freeing to live with fewer possessions and live more flexibly and clutter-free.

What does the future hold?

The rise of Generation Guppie presents both challenges and opportunities for the housing market. Their decisions are driven by financial constraints yes, but also a desire for a more flexible lifestyle and a shifting set of values.

Whether you wish to own a home or rent it is obviously entirely up to you and there are most certainly pros and cons for either side, but it’s vital to acknowledge and support all the diverse paths to happiness and stability and hopefully foster a housing market that meets the needs of the changing generations for years to come.