Five charts to start your day
Rents are climbing fast in Europe, removing any hope for the younger generation of saving for the future
Rents across European capitals are getting steeper. It’s great news if you're a landlord, provided you can afford the interest on your buy-to-let mortgage. However, for every young person who has already given up hope of getting onto the housing ladder, this is a real kick in the teeth.
So, what's going on here? Well, I’m a landlord and own a property in London, so here’s my take on the issue. When interest rates in the UK rose, they forced many landlords to sell their properties because they couldn’t afford the interest expense.
This temporarily flooded London’s property market with flats, leading to a moderate decline in prices. I say “moderate” because there is still a shortage of properties to buy in London.
By exiting the market, these landlords reduced the supply of properties available to rent in London, which has led to a steep increase in rents. I believe something similar has happened across Europe, which, I think, is illustrated in the chart below. It’s pretty depressing. Young and ambitious graduates can neither afford to rent nor save for the future to buy a property.
Source: Bloomberg
Coming up:
Lisbon has the most unaffordable rent in Europe
EU drop in Russian gas imports might see energy independence
Americans spend more on medicine than other countries
Value stocks versus growth stocks today
If you like what you see here, and you would like to view the other four charts, consider becoming a paid subscriber. It costs less than two cups of coffee for a whole month’s access.
