The rise of easy leasing deals has tempted many people to rent cars they could never afford to buy, especially electric ones. However recent vehicle fires, lack of public charging points and the sheer expense of insurance is cooling the rush towards pure EV vehicles, amongst private leaseholders at least.
The booming private rental market has also made accidental landlords of many a person experiencing a relationship split. It’s also attracted investment in apartment properties or affordable level homes by those with an inheritance to spend, or a good BTL business plan.
But will economic headwinds, legislation and political changes challenge that established BTL model? It may well be the case that incoming governments will want to see less ownership of second homes, large vehicles or other assets linked to wealth. Renters may be given more rights, like lifetime tenancies, or capped rent rises. Some regional governments may well start to seize empty properties as mass migration continues to gather pace. In that scenario the valuations of property and land assets may be volatile. For insurers and brokers there are interesting times ahead. Here are the insights from Prestige;
Unfortunately, this inequality also results in financial stress for many individuals, putting them at risk of rejection by standard insurers due to CCJs or other credit issues. Prestige Underwriting projects that, by 2030, the number of people with a CCJ issued in the prior six years could reach 6.7 million. While addressing economic inequality requires a comprehensive government response, particularly in the property market, modular homes are identified as a viable solution, with forecasts anticipating their number to reach 1.6 million, rising at 1.6% annually until 2030.
Shifting focus to climate change, the escalating vulnerability of homes to subsidence, flooding, and erosion is a growing concern.
While the annual incidence of these events remains unpredictable, the long-term trend indicates a clear rise. The cost of rebuilding is expected to outpace the incidence of claims, particularly in properties at risk of subsidence in London and the South-East. Prestige Underwriting projects that about a million more properties could face damage from climate change-related incidents by 2030.
Consumer responses to climate change include a notable shift to electric cars, a trend that is gaining momentum and is expected to accelerate in the coming years. However, meeting the demand for affordable electric vehicles poses a significant challenge. While manufacturers are working on cheaper models, potential shortages, particularly in the UK market, may prompt an increase in grey imports. Forecasts suggest that this segment could rise by 3.3% annually between 2022 and 2030.
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