Housing is not merely a social priority but it is as well a significant business issue. Currently we have a wider view of the impacts of putting up few households not only on our newspapers and exhibitions but also in our real life situations, our colleagues, friends and families. The working class incurs high pricing cost due to buying their new homes. Moreover, the renters lack the quality they need for their money. Due to this current situation of housing pattern, the UK property markets have been through a tricky transition in the year 2014 in terms of housing and this is not a different case of what the US real estate market and the Western Europe have undergone lately.
The young generations are staying for longer period of time with their parents since climbing the housing ladder is a beyond their financial capacity. Despite the fact that individuals may be able to afford the households that may be available within their localities, various aspects also has to be put into consideration such as the tastes and preferences, goals, life events as well as households’ dissolutions (George, Ian and Martin 231).
In making attempt to understand how the current situations impact on issues of household patterns and choice, it is relevant to put in consideration the housing owners’ occupation. That is, individuals’ ownership of households or when individuals purchase the households they reside in. putting into consideration the late situation of tenants in the UK and other nations entirely mentioned above, very small number are at that position of affording the houses without the assistance obtained from mortgages (Collinson 3). By making comparison with other competing financial products, the mortgages market stands on the higher position.
Another method which could also help in reducing the burden of household challenge if maybe one could not afford to put up one of his own with the required taste and preference is renting. In this tenure, one could make up his or her mind and obtain a private room to lodge or share one in an apartment from a particular landlord. The renting method could as well extend to the social level where it could be the link between the tenants and the local authority.
In the above methods of acquiring households, research indicates that the majority in the United Kingdom are either struggling to put up their own houses. However, the other few who are not in position of doing the same obtains their households through mortgages. The majority prefer that if they are not able to build their own homes then they buy the homes fully or do that in their futures according to most of the British popular culture (George, Ian and Martin 240). This preference has also been on the rise because of the lately reported trend of property price and the shooting interest rates of mortgages as reported in the local news outlets of the United Kingdom.
It is evident that the reported growth of home ownership in the UK is because of the social, political and economic developments. As given in the prelude of other articles, the increase in the income level has enlarged the households’ scope to finance the required mortgages to purchase their own property. Additionally, the significantly increasing affluence has provided the lenders of mortgages with extra comfort concerning the level of trust they have towards the people they are lending to. Other than the indicated high rates of interests in mortgages, the cost of paying high rents monthly could be another pressurizing factor which could push individuals to buy or build their own households.
Liberalization could be additional reason for the people in the United Kingdom to strive to have their own residential places. The process of liberalization has substantially enlarged the availability and affordability of the types of mortgages therefore, leading to an increase in the mortgage lenders competition. The impact of increase in finance supply integrated with the presence of comparatively low priced deals to the home owners have also enhanced the issue of own ownership of homes (George, Ian and Martin 237).
Possessing houses in mortgage, that many who may not afford buying houses directly may prefer, has several challenges hence the need for own household. In events of any form of financial crisis or breakdown such as instances of sickness, separation or loss of a job, the value of the mortgage may go up making the lender to repossess the house. Such situations often make people fear the unknown challenges that may befall them in future therefore opting to own their individual households (George, Ian and Martin 262).
Owning ones’ home is a long lasting asset that one can always confide in. the legal right that an individual have when having his or her own property helps a lot in the personal security system (George, Ian and Martin 254). People do not have to face the rates of inflations whenever they have one of their own. The inconveniences of moving or rather relocating when the value of the house goes down is also limited when one has personal household. Moreover this limits the breach of rights and conditions which may be inherent between the landlord and the tenant in a case of rental households.
Mortgages not only comes with the risk of uncertainties but also one may risk in such a way that the investment or the savings vehicle that they used in settling the principle sum in mortgages which only have interests not producing adequate money. The low interest and inflation rates and the global stock markets’ weakness shows that many borrowers are standing at high risks of getting back the principle sum to settle their mortgage sums. This risk could mostly occur due to failure of the borrower to review what they were to set aside (George, Ian and Martin 271).
A further uncertainty why it would be safer for individuals to go for own households is that mortgages would end up fetching extra of what they were not designed to cost. The double impact of mortgage could be as a result of increase in competition recorded in mortgage markets. The outcome will definitely be catering for the new mortgage at a lower rate available for the lender as well as paying the existing mortgage. For this reason, having their own households would save from such financial burdens.
Work Cited
George, Callaghan, Ian Fribbance, and Martin Higginson. Personal Finance: New York, 2012. Print.
Collinson, ‘Home ownership in England falls to lowest level in 25 years’, Guardian, 26 February, 2014 [Online].
