A recent study has found that most millennials are content with living in rented accommodation for the time being, which means that the growing demand from this generation isn’t going away any time soon.
The study carried out by Nottingham Building Society analysed the YouGov profiles of a selection of 20 to 37-year-olds in order to investigate their preferred living situation. They were also surveyed on their attitude towards buying their own property and their overall thoughts about the UK’s housing situation and economy.
The key takeaway point of the study was that most millennials are not in a position to own their own property. However, a large number were in no hurry to purchase a home, with only one in 10 of the respondents saying that they were planning to take a mortgage out in the next 12 months (even though a third of respondents said that they were in the process of saving up for a property of their own). Even fewer of the respondents owned their own property, with 23% saying that they own a property with a mortgage and 3% owned a property outright.
These responses should come as no surprise; according to the latest Rightmove House Price Index, the average house price now stands at £309,348 and, according to recent figures from Zoopla, any prospective first-time buyer in a big city will need to save up an average of £38,418 for a deposit. In addition to this, the average salary required to purchase a home now stands at £54,400 – a far cry from the national average full-time salary of £35,423 (including London).
35% of the respondents also admitted that they look at the economy and current affairs to influence their decisions on making key purchases, with many waiting for Brexit to blow over before buying their own property. However, many felt positive about their financial outlook, with 38% believing that they were better off now than they were a year ago.
Another key point that came out of the study was that tenants were leaving the bigger cities in favour of smaller towns. A study from the Resolution Foundation thinktank found that the number of 25-34-year-olds relocating to bigger cities for a new career had fallen by 40% in the past two decades. This was largely down to affordability, as rents in the big cities continue to grow.
However, there is a growing trend of millennials staying in more remote areas out of choice. In the study by Nottingham Building Society, an overwhelming 64% of respondents they felt like they had a better quality of life living in smaller towns than they would moving to a city.
These new findings should come as great news to landlords. It’s also a clear reminder that buy to let investors need to start looking off the beaten track for their next investment, where there’s potentially better earning potential than if they were to invest in a big city. However, regardless of where you are in the country it’s clear that the demand for rental properties in the UK continues to thrive.
Are you looking for your next buy-to-let investment? Have a look at our available properties!
