As a part of the work I’ve been doing on GDP fo the glossary a remark was made concerning the little-known ingredient inside GDP that’s made up of imputed rents paid by owner-occupiers of housing within the UK for the entitlement that they’re deemed to have of residing in their very own homes lease free.

I’ve carried out only a little information crunching on this as the topic is so little identified about. This outcomes:

Click on on the information to see a bigger model of this.

The ley level is that in 2021 precise rents paid for housing within the UK had been £87 billion. These had been massively overshadowed by imputed leases for housing, which had been £231 billion. That is the sum that for GDP accounting functions an proprietor occupier is deemed to pay themselves for the precise to stay in their very own residence. This sum has supposedly to be added to GDP to verify UK GDP information is comparable with the GDP information of nations, like Germany, the place renting could be very way more frequent than it’s on this nation.

As is clear from the desk the online result’s that during the last decade, simply over 10% on common of GDP has actually been made up. There is no such thing as a such earnings on this nation. Neither is any tax paid on it.

Additionally it is curious to notice that while precise rents have grown from 2.5% of GDP to 4% of GDP these imputed rents have fallen from 12% to 10%. There has, in fact, been a swap to rented property within the UK, however it’s laborious to see how imputed rents have fallen so closely when the price of homes has risen to considerably. I’ve not seen commentary on this problem, and it’s not the first focus of this submit.

That focus is on the truth that we actually ought to b conscious that when GDP information 10% of it merely doesn’t exist. No marvel it’s such a ridiculous measure.