Young Professionals and Students Seek Affordable Housing in the UK's Most Expensive City LHA London London is one of the more expensive European cities, and this fact affects how young people who move to the British capital live. The real estate market is directly affected by these prices, which in turn poss a challenge to students and young professionals looking to settle in the city pierced by the River Thames. One of the most popular solutions young people have found over the past decade is living in a hostel in Central London. Generally seen as an affordable residency option, some hostels in this area are strategically close to Tube stations, making it easier to travel to school, work or attractions. The current situation: London’s living costs London has a population of approximately 9,540,576 people but only about 3.6 million dwellings. The demand for living space has resulted in high rental rates: rent cost Londoners an average of £1,770. Rent costs are unlikely to dip as inflation rates continue to soar. The current inflation rate is at 5.4% year-on-year due to logistical challenges and rising fuel prices. Zeroing in on the housing market Another factor that can affect young people’s decision to either rent or buy property is the current state of the city’s housing market. While many left the city during the height of the pandemic, the market is still considered volatile. The exodus from London saw the demand for housing decrease, and prices have gone down in response. As more people look for detached properties outside London, the city’s existing housing options are decreasing in value. Renting vs. Shared Ownership The question now boils down to whether London’s youth should look into renting or buying their own properties. Since students and young professionals generally don’t have adequate purchasing power, shared ownership has grown in popularity among this demographic. With this method, they buy a stake between 25% and 75% in a property. They only need to pay the mortgage on the share they own, but they do need to pay the landlord rent on the remaining shares at a discounted rate. While this is a good first foray into home ownership, the threat of property devaluation can see young people squander their investments. This is especially true in a housing market that has more supply than demand. While a long-term stay at a hostel instead of traditional home ownership or renting might not seem like a wise investment, it is a much more affordable option. It also allows young adults to live in a safe, secure space with all the amenities they need. Hostels give residents flexibility in terms of length of stay, and some also offer private rooms. RESOURCES https://lhalondon.com/ https://www.statista.com/statistics/585272/number-of-dwellings-london-uk/ https://data.london.gov.uk/blog/the-rising-cost-of-living-and-its-effects-on-londoners/ https://www.whatmortgage.co.uk/news/first-time-buyers/shared-ownership-cheaper-renting- london/