The rapid development of leasing has become a common international phenomenon, and it can be said that “the country of leasing” is increasing.
The rapid development of leasing has become a common international phenomenon, and it can be said that “the country of leasing” is increasing.
The following 10 charts show you the general trend of housing rental.
. You will see.
01, the three stages of the mature housing market
02, housing, crisis for young people
03, renting, global trends
01.
The three stages of a mature housing market experience
Overview of the history of the UK over the past 100 years, the shift in the proportion of the private rental market reveals three major stages in the development of a mature housing market:
Figure 1: The UK’s century-old housing structure changes
Early stage: rapid population growth and severe housing shortages.
The private rental market is absolutely dominant, with more than 70% of people “renting and living”, it can be said that this period is the era of renting;
Central stage: With economic growth and housing starts increasing, more and more people are becoming owners, and the market is entering the era of buying houses;
Mature stage: When the house price is high to a certain extent, the private leasing market has risen again, and the young people who are powerless have entered the era of more long renting.
London’s housing structure map also gives us an inspiration:
Figure 2: London Housing Structure
The number of people who solve housing problems through home purchases has dropped rapidly. More and more people are turning to private leasing markets, renting houses from private landlords, corporatization organizations, investment companies and other channels.
The phenomenon in London is not accidental. The international metropolis with the highest price and fastest rise is also the place with the highest proportion of rental population, most of which is between 40% and 60%.
New York’s rental population is 56.9%, Los Angeles is 54.4%, London is 49.8%, and Tokyo is 39.5%.
02.
Housing issues, youth crises
The picture below shows the proportion of people living in different age groups in London who have solved the problem of housing by buying a house.
Figure 3: Population distribution in London with its own housing
It can be seen that there is a serious housing polarization in the UK: more people with wealth, more than 55 years old, have more people to buy a house, while other age groups are fully “looking at the house” In particular, the 25-34 year old population is squeezed to the greatest extent.
This issue is not unique to London. Many cities in China are also facing this problem.
The social stratum of these places is divided into: there are housing and no housing, and the improvement of housing replacement with the housing is synchronized with the rental demand of no housing.
Figure 4: Changes in rent, income and affordability (London)
In international metropolises, rent increases are likely to continue to outpace income growth, triggering an increasing problem of rent payments.
In this case, an effective solution path can only be to expand the supply of the lease.
For example, from 2005 to 2018, after inflation adjustments, London’s average rent rose by more than 30%, while average income rose by less than 20%, which meant a deterioration in affordability.
Figure 5: 18-34 year old AmericansCondition
The housing crisis is an eternal topic, and today’s housing problems are more of a crisis for young people.
A study by the Pew Research Center in the United States:
For the first time in 130 years in the United States, people aged 18-34 are more likely to live with their parents.
In this age group, 32.1% live with their parents, 31.6% live with their spouse or partner, 14% live alone (individual residence or head of household), others live with other members of the family, non-family members or Collective residence (such as a university dormitory or prison).
03.
Renting, global trends
The marketization and diversification of leasing participants are the basic conditions for leasing development.
Figure 6: Proportion of public housing in different countries
Germany, as the most developed country in the world’s leasing market, has the lowest share of public housing.
In Germany, private landlords, companies, associations, churches, investment companies and other entities can carry out leasing business under the unified conditions of the government.
Conversely, those countries that rely on the government to provide public rental housing are either problematic and the government does not mention opt-out, such as the United Kingdom;
Either choose transformation and reconstruction, and adjust the way the government participates, such as the Netherlands.
Figure 7: Proportion of rental households in different countries
The combination of rent and purchase is not a unique trend in China, but a global phenomenon. More and more countries are moving towards renting a society.
The proportion of rental households in the United States, Japan, and the United Kingdom is generally higher than 35%, while Germany is as high as 53%.
More and more families are choosing to rent as a means of living and staying in the rental market for a longer period of time.
From an international perspective, from the perspective of a country, rent-and-buy means that the country’s rented population reaches 30-40%;
From the perspective of international metropolises or core cities, thisThe ratio will even reach 50-60%.
Figure 8: Average Lease Period
China’s average lease period is the shortest, and the lease relationship is the most unstable and most uncertain.
This situation will be alleviated as the proportion of institutionalized leasing increases.
The average lease cycle in Germany is 11 years, the average lease cycle in Japan is 5.2 years, the average lease cycle in the UK is 2.5 years, and the average lease cycle in China is only 8 months.
A long and stable lease cycle will give tenants a higher level of security, prompting tenants to choose leasing as their long-term housing solution, which will benefit the long-term benign development of the overall leasing market.
Figure 9: Distribution of rental people
In the mature leasing market, single people are the most popular category among leasing people. But married, even married families with children are a very important component, which means that rental needs are very broadly covered.
The same is true of the income structure. Not only for low-income people, leasing is becoming a common choice for a wide range of income groups.
Figure 10: Where does the rental listing come from?
From the experience of developed countries, most of the rented houses come from private landlords. These landlords either rent out direct brokers or entrust professional institutions or property management managers to rent them.
In this regard, over the past decade, a prominent trend has been the continued increase in the proportion of institutional landlords.
They mainly do not develop through the development, but through the acquisition and integration, the stocks are renovated and re-sold.These large institutionalized landlords usually have strong financial and asset management capabilities, mostly listed apartment reits.