The increase in house values in the UK has, until recently, far outstripped the increase in people’s earnings. It is perhaps not surprising, therefore, that over the past ten years there has been a significant fall in the proportion of young people buying a home.
Trend data from TGI shows that the proportion of 18 to 34 year olds buying a home is down from 57% in 1998 to only 48% today. Over the same period the proportion of young adults who rent from private landlords has increased dramatically.
Ten years ago 13% of 25-34s rented a house or flat, compared to 23% today. Renting is most common in London, where the proportion of 25-34s living as tenants is higher than the proportion actually buying their own home – 40% versus 37%. Greater London is the only region in which the proportion of 25-34s renting is greater than the proportion buying. In the East Midlands, the region with the lowest level of accommodation rental, only 11% of 25-34s rent from a landlord – compared to 69% who are buying their own home.
As the number of young adults renting property grows, the number of those in their twenties who are choosing to live with their parents rather than move out is also increasing. The proportion of 20-24s who live with their parents has risen from just over 30% in 2003 to almost 40% today.
The region with the highest level of outright home ownership is the South West, where 39% of adults own their own home. Scotland has seen the largest increase in home-ownership – up 47% since 1998 – followed by the North of England and the East Midlands. Only two regions, East Anglia and Scotland, have seen an increase in the percentage of the population buying their own home – both up 2%. The biggest falls have occurred in the South West (down 16%), the South East and the West Midlands (down 15%), and Greater London (down 14%).
Among the regions that have seen large increases in property rental are Greater London (up 92%) and East Anglia (up 75%). In the South East rental is up 38%, in the South West it is up 13%, and in the South overall (SE, SW, Greater London) it is up 50%. The East Midlands is the only region that has not seen a rise in this kind of rental.
Approaching 40% of the more than two million adults who moved in the past year made major improvements to their property, compared to just 10% of non-movers. In addition, home-movers are more likely than the average to have bought a range of products, including kitchen and bathroom appliances, floor coverings, and furniture. They are nearly four times as likely as the average adult to have bought a washer-dryer, nearly three times as likely to have bought a dishwasher, and more than twice as likely to have bought a built-in oven. One-fifth bought bedroom furniture, compared to 6% of the general population, and more than one-quarter bought furniture for the lounge or living room.
In terms of expenditure, 22% of home-movers spent more than £500 on kitchen appliances in the past year, compared to less than 10% of non-movers, and 12% spent over £3,000 on furniture – making them three times as likely as non-movers to spend this amount. One in five of those who spent over £1000 on carpets moved home in the past year, and home-movers are also considerably more likely than the average to have spent heavily on curtains.
Perhaps more surprisingly, home-movers do not necessarily limit their spending to refurbishment. A significant number purchase electronic goods. They are, for example, over 40% more likely than non-movers to have bought a TV set, and 25% more likely to have bought a DVD recorder. They are also considerably more likely than the average to have bought a micro system or a DAB digital radio.
Garden tools and accessories are another key area of spending for home-movers, with 70% having bought from a garden centre in the past year. Home-movers are more than twice as likely as non-movers to have bought garden furniture in the past year, and are also considerably more likely to have bought garden tools such as lawnmowers, hedge trimmers, and strimmers. Less obvious is the fact that home-movers are more than twice as likely as non-movers to have bought a barbecue.
More than three-quarters of home-movers undertook DIY in the past year, compared to less than 60% of non-movers. Almost 60% of home-movers shopped at B&Q in the past year, and one-third shopped at Homebase. They are also over 60% more likely than non-movers to have shopped at Dobbies or Wyevale.
TGI analyst James McCombe contributed to this week’s Insight