My parents bought their first house in the 1970’s, they were in their early 20’s. Interestingly, looking at some research by the Post Office from a few years ago, in the 1960’s the average age people bought their first house was 23. By the early 1970s, it had reached 27, rising to 28 in the early 1980’s.
This year alone, 333 people in Melton Mowbray will turn 28 and 315 in 2017 .. and dare I say 361 in 2018 .... where are the Melton Mowbray youngsters going to live?
Ask a Melton Mowbray ‘twenty something’ and they will say they do not expect to buy until they are in their mid thirties - seven years later than the 1980’s. One of the major problems facing young Melton Mowbray people is the large deposit needed to get a mortgage .. or is it?
The average price paid for an apartment in Melton Mowbray over the last 12 months has been £115,600 meaning our first time buyer would need to save £5,780 as a deposit (as 95% mortgages have been available to first time buyers since 2010) plus a couple of thousand for solicitors and survey costs. A lot of money, but people don’t think anything today of spending a couple of thousand pounds to go on holiday.
I was reading a report/survey commissioned by Paragon Mortgages from the autumn of last year. The thing that struck me was that when tenants were asked about their long term housing plans, some 35% of participating tenants intend to remain within the rental sector and 24% intended to buy a house in the future, with the proportion of respondents citing the “unaffordability” of housing as the reason for renting privately increasing from 69% to 74%.
However, time and time again, in the starter home category of property, nine times out of ten the mortgage payments to buy a Melton Mowbray property are cheaper than having to rent in Melton Mowbray. It is the tenant’s perception that they believe they can’t buy, so choose not to.
Over the last decade, culturally in the UK, there has been a change in the attitude to renting so, unless that attitude changes, I expect that the private rental sector in Melton Mowbray (and the UK as a whole) is likely to remain a popular choice for the next twenty plus years.
With demand for Melton Mowbray rental property unlikely to slow and newly formed households continuing to choose the rental market instead of purchasing a property. I recommend landlords pursue professional advice and adopt a realistic approach to rental increases to ensure that they are in line with inflation and any void periods are curtailed.