News Release
AXA Insurance
PR & Communications Department
AXA Insurance
No 3 Atlantic Quay
20 York Street
Glasgow G2 8JH

Financial confidence grows, but life remains restless and insecure for today’s tenants

14 September 2016. According to new research by AXA*, British tenants are experiencing a surge of financial optimism, as more see buying as a realistic prospect and more are able to save. Despite the average tenant expecting to rent for a further decade, British rental culture remains short-term and highly insecure. AXA calls for deeper cultural change to ensure greater peace of mind for all.

The study found a growing financial confidence among tenants, as more see home ownership as a realistic prospect. In 2013, 67 per cent of tenants surveyed said they rent because they can’t buy, and don’t expect that to change. This year, that figure has fallen to 44 per cent, as four in ten tenants (equal to 1.7 million) now expect to buy or become rent free in the next five years.

The number of tenants saving for a deposit has doubled too: a quarter in this year’s survey, up from just thirteen per cent in 2013. This optimism is largely limited to tenants in the under 35 category, however, and the average tenant still expects to rent until the end of 2025 – that is, for a further nine-and-a-half years.

The study identified a growing number of lifestyle tenants in Britain: a third of tenants now say they choose to rent. Of those who could buy, but don’t, 10 per cent say they are between relationships and 17 per cent are career builders who follow job opportunities or projects around the country. Meanwhile, 18 per cent simply prefer the freedom and low commitment of the ‘tenant lifestyle’.

While most tenants expect to be on the rental market for a further decade, they will only stay in each rental property for an average of two years. And there is little appetite for a more European culture of five and ten year leases: 61 per cent prefer the status quo of six months to a year, with just 18 per cent saying they would benefit.

One reason identified by the study was that in Britain, tenants are a highly mobile population. Within the next five years, two thirds of tenants – or 2.7 million people nationwide – plan to migrate to another region of the UK, and one in t will emigrate. London, Bristol and Edinburgh top the list of ‘stepping stone towns’, where tenants tend to stay the shortest time.

Shifting sands – the downside of British rental culture

The downside of Britain’s short-term rental culture can be a sense of insecurity all round – for both tenants and landlords. Sixty four per cent of tenants say they worry about being forced out of their property at short notice. Older tenants and those with children worry most: “I just wonder what will happen if my landlord sells my house and I have to move, which is not easy to do at 72 years old. I’ve built a social life around me in my village and clubs that I go to”.

Moving on so often, British tenants also struggle to feel a sense of home or control over their personal space. A third of tenants surveyed said they have to shop around for new tenancies, not because of price, but because it is only way they can improve their living space, citing restrictions on hanging pictures, having pets and decorating.

In a separate AXA survey, landlords named high turnover of tenants as the thing that most keeps them awake at night. With such tenuous relationships, a minority can say they know their tenants personally, and most (68 per cent) see their tenants once a year or less.

“Private landlords are filling the gap left by the decline in social rentals and home ownership, and they are becoming the second biggest source of housing for the British population,” says Darrell Sansom, Managing Director at AXA Business Insurance. “But rental culture is not as well embedded in British society as in other European countries.”

“Short-term tenancies prevail here, and while bringing benefits to some, this means that both landlords and tenants can feel as if the ground is constantly shifting under their feet. How can tenants create a sense of home in this situation? And for landlords, a revolving door of strangers means income insecurity, periods of vacancy (with much increased risk of damage and crime), and more wear and tear.”

“With such a mobile tenant population, landlords need to work that bit harder to encourage longer stays. Few tenants are interested in being ‘locked in’ to a long lease, but little compromises on things like pets, freebies like broadband or cleaning services, offering to redecorate – can build precious loyalty. As an insurer, we also know that when landlords and tenants get to know each other and talk regularly, they have more peace of mind and greater financial security in the long run.”

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Enquiries

Amy Needham, PR & Communications, , 07434804059.

Notes to Editors

*AXA surveyed 1,000 tenants in Great Britain in July 2016, and conducts a quarterly survey of landlords (sample size: 300).

About AXA Business Insurance

AXA Business Insuranceis part of AXA Insurance UK plc, which belongs to the AXA group of companies. With us, you choose the business insurance that’s right for you. We offerpublic liability,employers’ liabilityandprofessional indemnityinsurance online to start ups, sole traders, self-employed people and small businesses. In addition we offervan insuranceandlandlord insurance. AXA Business Insurance also runsBusiness Guardian Angelwhich provides resources to help protect and grow small businesses. You can follow AXA Business Insurance on Twitter @AXAbizteam for business insurance help, and find AXA Business Insurance on Google+ and Facebook – and you can watch expert guides and business case studies on the AXA Business Insurance YouTube channel.

About AXA

The AXA Group is a worldwide leader in insurance and asset management, with 166,000 employees serving 103 million clients in 64 countries. In 2015, IFRS revenues amounted to Euro 99.0 billion and IFRS underlying earnings to Euro 5.6 billion. AXA had Euro 1,363 billion assets under management as of December 31, 2015. In 2015 Interbrand ranked AXA the 1st insurance brand worldwide for the 7th consecutive year.

In the UK AXA operates through a number of business units including: AXA Wealth, AXA Insurance, AXA PPP healthcare, AXA Ireland and an independent distribution business Bluefin. AXA employs over 10,500 staff in the UK.

The AXA ordinary share is listed on compartment A of Euronext Paris under the ticker symbol CS (ISN FR 0000120628 – Bloomberg: CS FP – Reuters: AXAF.PA). AXA’s American Depository Share is also quoted on the OTC QX platform under the ticker symbol AXAHY.

The AXA Group is included in the main international SRI indexes, such as Dow Jones Sustainability Index (DJSI) and FTSE4GOOD. It is a founding member of the UN Environment Programme’s Finance Initiative (UNEP FI) Principles for Sustainable Insurance and a signatory of the UN Principles for Responsible Investment.