Millennials have been labelled the renting generation for a while now. Living in a major city as a millennial means you’re likely to be burning a lot of your money in the rental bonfire. So the question becomes, how the hell are we expected to buy a place of our own?
Renting a bog standard 1 bed flat in London will set you back £1,246* on average per month. With a flat share, MTM and I are paying under half this at £600 per month. This means extra £s, $s and €s to throw at our savings for a house – the majority of which we are putting into a LISA and passive income streams; enabling two millennials to save a 20% deposit for a 2-bed house (somewhere inside the M25 / London) within 39 months.
Living in a flat share is saving us a huge £25,194 in rent over this period. Compounded at 5% this equates to £27,408.71.
As well as the huge financial positives, there are many social benefits too. Renting a 3-bed flat and sharing with other people means we’ll have a bigger social space. We hope to have lots of people round for dinner and drinks – saving us money going out for food! Also being in a flat share encourages us not to get too comfortable in our current situation, which will motivate us to save hard so we can eventually live on our own, in a place that we own.
The renting generation is facing an uphill struggle, there’s no denying that. Crazy house prices, stagnating wages and youth unemployment have left millennials truely screwed! But don’t allow yourself to be dragged into this ‘generation rent’ bracket. By educating yourself on the best way to get yourself a house, establishing what you can honestly afford and finding ways to save money like it’s running out, you really can wade out of the renting generation.
* According to Homes & Property ‘Renting in London’ January 2017
** by ‘sufficient’ I mean if you’re income is within the ballpark of the average salary based on region, you’re likely to