Research suggests that the younger demographic is leading the way and this is leading to the rise of ‘Generation Rent’. This is due to ownership no longer being a priority for millennials as they instead value access and no longer feel the need to own material possessions.
Innovation in ecommerce has led to the rise in the digital marketplace economy, matching supply and demand of sellers and buyers. The evolution of this economy, which responds to the millennial mindset is the sharing economy. This is an economic system in which under-utilised assets are shared between individuals, either free or for a fee. The UK is the European capital of the sharing economy, accounting for 1 in 10 of the world's companies in this new digital sector. PWC expects the UK’s sharing economy to be worth £140bn by 2025.
Transitioning from Owning to Sharing
To accelerate the transition to this economy, new technologies are making people sharing their assets more practical. Badi is accelerating this revolution in the UK as we transition to sharing our homes, by allowing people to more easily find people who they will get along with.
In the shorter term this means that fewer and fewer of us will own properties. In a decade’s time, we believe, home ownership in the UK will be massively reduced. Houses themselves won’t disappear, of course, but there will be fewer of them, they’ll be used more efficiently and they’ll be better monetised.
A study in 2018 showed there to be 205,293 empty rooms in the UK. This is the equivalent to £50bn which becomes lost in vacant property. With population rising and home ownership becoming increasingly inaccesible, renting and in particular sharing room-rental is on the rise. People take understandable pride in their homes. After all, they are the most expensive item we’ll ever buy. More and more of us are waking up to this financial reality and, as a consequence, are embracing a new approach: paying for access to homes, rather than ownership.
This is the same model we’ve seen boom in other areas of our lives. Increasingly we pay for access to music or movies, for example, rather than owning physical copies of them. For the Millennial generation – anyone aged 35 or under – it’s become normal to pay for experiences rather than buying more possessions. It’s only natural for us to apply that same mindset to our homes too.
Growing Communities in a polarised world
We believe sharing economy platforms can play an important role in strengthening our communities by connecting people with each other, in a context of trust and mutual benefit. There has been a huge growth in co-working spaces and even Uber is now encouraging riders to share journeys with Uber Pool.
We often hear that our modern world is less trusting than ever and with the ever-growing population people can often feel lost. But the rise of businesses like Airbnb demonstrate we’re actually sharing more with strangers than we’ve ever done. That’s thanks to the new way sharing economy platforms enable and guarantee trust.
They connect “buyers” and “sellers” of a shared asset who can see the other party’s reputation and ratings, so they can deal with each other with confidence. In badi’s case this goes one step further by using AI to actually match people who will be suited, and we predict technology will increasingly be used to further enable the sharing of goods and assets.
