The property market in Britain has changed so dramatically over the past 50 years that it is now unrecognisable compared to the 1960s. Statistics have revealed that if the price of food had risen at the same rate as house prices in the last 50 years, 4 pints of milk would cost £10.45 today. The cost of renting a home has also increased by 13% year-on-year over the past 4 years.
In addition to mounting prices, the housing market has also changed the way we live. In Britain, you are now far more likely to live in a house-share, and millions of people rent with flatmates every year. Therefore, many landlords and property developers have invested in buildings that are designed to be shared. We have looked at how this has changed the market for property owners and how it has brought many advantages to landlords and developers alike.
Life has changed significantly since the 1960s in many ways and as a result, the property market has changed with it. The role of women in society has changed drastically, and there has been extensive reform in the education system, both of which have meant that more people now go to university or higher education. Consequently, you are now much more likely to share properties with student friends both during and shortly after university, rather than living with a partner and having a family at a younger age.
The trend of flat sharing amongst students is increasingly popular, with students making up 25% of the property sharing market today. However, young professionals now make up an impressive 58% of the market, showing how young people continue sharing after university.
Moreover, advances in medical care mean that parents and grandparents are likely to live for much longer, meaning that the next generation usually receives inheritance at a later stage in life. As such, people are less likely to take large inheritances and invest in property until they are older. Rising prices in rents and house deposits mean that people have less opportunity to save and purchase their own home.
All of these factors have made house-sharing an increasingly common, easy and low-cost alternative for many people today. The housing market has changed dramatically, leading to a surge in the amount of landlords and developers who purposely buy properties with the intention of letting them out to multiple tenants.
Built to Purpose
Due to these significant changes in the market, many developers now build and convert existing buildings with the main purpose of creating flats or houses that will be shared. Some of the most lucrative and interesting works have been conversions, whereby developers have changed old industrial or institutional properties into shared flats. This is a great way to retain the character of a building and keep it alive by changing its purpose to suit the needs of today’s tenants.
Many homes that would have been previously occupied or owned by families have now been converted to have more bedrooms. Developers often decide to extend such buildings, adding more bedrooms. Some also remove little-used dining rooms and convert them into downstairs bedrooms. Houses that are already designed for residential purposes do not need extensive changes, and it is relatively cheap to convert an ordinary house into a house-share property.
Letting Out Flat-Shares
Many landlords choose to rent out shared properties as opposed to single – or couple- occupied homes, simply because it is much more lucrative. House shares are slightly cheaper for tenants as the rent is split between two or more people. Sharers, for example have an average budget of £531 pcm to spend on rent, whereas single occupants spend £548 pcm on average. However, overall it is more profitable for the landlord as many occupants contribute more rent than a single occupant would.
This trend has changed the way the rental market is represented online. Today, it is very easy for tenants to find flatmates to share properties with, so it is easy for landlords to find multiple tenants who would like to share a home together. Websites such as Roomgo bring people together and make the process of renting, letting out and sharing much easier than it might have been in the past.
The Property Market
Over the past 50 years, the property market and the economy in Britain has changed dramatically. In the 1960s, British houses were priced as low as £5,000. In 1975 house prices averaged at £10,000 – and it would cost you just £600 to buy a Mini Cooper Car. By 2025, it is estimated that the average UK home will be valued at £419,000.
If you want to find out more fascinating facts about the British economy and the property market over the last half-century, take a look at the property timeline of Affirmative company.
This guest post is brought to you by Affirmative, industry leaders in development and bridging finance for all types of property owners.