Owning a property is often considered one of the top “life goals” of millennials and Generation X. It’s considered as important as getting married, or having children, to many people, but owning a home and feeling at home are different and young people are starting to see the many benefits of renting in a market in which it is more difficult to purchase property.
There are many reasons why the rental sector is becoming more appealing to this generation of people, and why affordable housing is in the decline. One such reason is that people are living longer, keeping their family homes longer and often not downsizing to free up equity. With equity release programs available for people who wish to remain living in their home, these properties become unavailable for people further down the ladder looking to make their move to the next stage property.
This causes an unfortunate (for some) effect of lack of affordable housing both at the start of the ladder and a few stages above. This has led to a rise in new build properties; however, these are typically more expensive than other pre-owned properties of a similar size in the market. With the addition of schemes such as Help-to-buy loans and ISAs, the government is making steps to provide new routes into making these steps, however the age of first home ownership has still risen in the last 10 years from 30 to 33. In addition, ownership of homes has declined by a staggering 20% over the same time.
This is also affecting families heavily. Once children reach school-age, properties in catchments for quality schools become highly sought after. This leads to a housing price increase forcing older young people (35 – 44 years) to move to accommodate their children’s needs, often at the choice of downsizing for budgetary reasons or selling and moving to rental properties within their desired area. In fact, the age of renting has increased with a nearly 20% increase in renters of age 35-44 in 10 years. Finally, another major reason for the increase in renters in the market, is that house prices are rising more than wages or salaries, resulting in an unrealistic balance of salary to house price, working against young people getting on the ladder. Young people are looking for affordable, flexible housing which can accommodate their lifestyle and budget.
As a landlord, you are in the privileged position of being able to tap into a market which is ripe for taking advantage of. Whether that’s building your property portfolio to grow your income or whether you are just starting out as a landlord – it’s time to talk to our experts. Get in touch with a member of our team here to discuss how you can make the most of your property or properties.