RBS set to target ‘Generation Rent’

RBS will target young tenants when normality returns after the coronavirus crisis, The Mail on Sunday can reveal.

The bank forecasts a big fall in home ownership and experts expect the trend to accelerate as house sales resume.

A plan buried in a bank strategy document shows that RBS has forecast that renters aged 35 to 44 will outnumber mortgage holders by 2029.

It found the proportion of private renters in that age group will leap from 29 per cent to 47 per cent in the next nine years as those with mortgages falls from its current level of 48 per cent.

The bank is exploring ways to attract affluent tenants – often dubbed Generation Rent – with financial products to make that option more affordable and help them save for a home deposit later in life.

It has been examining lucrative innovations from rivals that include bill-splitting services for flat-sharers and products that sidestep deposits.

RBS may also allow punctual rent-payers to build their credit score, which would give them better mortgage options.

Housing experts said the downturn would make it harder for first-time buyers. The Bank of England

has forecast that the economy will shrink by 14 per cent this year, with unemployment rising to nine per cent in 2021.

The recession is likely to stifle wage growth, making it hard for young families to save for a deposit, especially with savings rates at rock bottom.

RBS chief executive Alison Rose has said that her strategic plans are the ‘right ones for the bank’ despite the coronavirus pandemic.