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The British housing market has never been so newsworthy.  Every other day there is an article in the newspaper or online about impending house price drops, house price rises, building on green belt, mortgage rates up/down, first time buyer affordability and the woes of being a buy-to-let landlord, to mention but a few.  Yet, as a nation, we have a strong desire to be homeowners. 

The English Housing Survey stated the proportion of ‘owner occupied’ households increased steadily from 52% in the early 1980s to 2003 when it reached its peak of 71%.  Since then, owner occupation gradually declined to 63% in 2014, yet in fact increased to 64% in 2017 and has stayed there since.

One of the main motives of home ownership is the prospective tax-free capital appreciation that can be obtained.  It’s no wonder the phrase ‘as safe as houses’ is popular in the English language, as many homeowners use homeownership as a nest egg or even a pension pot - especially as savings rates are at extraordinarily low levels.

Yet even with the news that homeownership is on the rise, the biggest seismic shift to the Stamford property market is the growth of the rental market, which has more than doubled in the last 15/20 years.  So how can the social housing sector remain roughly at the same level since the millennium, homeownership slightly grow, yet the private rental sector be so huge?

Well, it comes down to the fact that many more homes have been built in Stamford in the last 15/20 years, and a lot of them have been bought for buy-to-let (or Stamford homeowners with second-hand starter homes have also sold them to buy-to-let landlords and they have bought larger brand new homes).

Yet the question we wanted to ask is ‘are we building the right sort of homes, especially when it comes to the number of bedrooms?’ Whilst the data doesn’t exist for Stamford, the country’s stats are available and it makes fascinating reading...

Looking at the graph in 2008, 59% of new homes built were one and two beds, yet last year that had dropped to 35%.

The Housing Minster said recently he was concerned that new homebuilders were building the wrong types of homes in the wrong places at the wrong prices.  Many (not all) tenants are tenants because they can’t afford the deposit and as there is a direct correlation between the rent’s landlords charge and tenant’s earnings (i.e.  as earnings go up, rents go up and vice versa), and earnings for the last seven years have been subdued, the property tenants have been able to afford in Stamford are the smaller one and two bed properties.  Yet a lot of these tenants are now having families (with the need for larger property with three, even four bedrooms). 

Looking at the stats for South Kesteven, it can be seen the vast majority of homeowners live in the larger properties with more bedrooms, whilst private rental tenants are in the smaller properties (with less bedrooms).

Our concern is whether young families and professionals will be able to afford to live and work in Stamford, especially as the local authorities are unable to build social housing?

One symptom of all these issues mentioned above is the massive growth in multi-family households (i.e.  households containing two or more families), which have increased by 42% in under a decade.  Now of course many will be because of older couples moving in with their adult children yet many are unrelated families sharing a house, something that simply shouldn’t be happening in 2019.

If we don’t increase the supply of the ‘right’ sort of homes, what will their living conditions be like?

Whilst we are still a country of homeowners and even though there has been a slight growth in numbers, the long term trend is downwards if we don’t build enough of the ‘right’ new homes, in the ‘right’ location and the ‘right’ price, Stamford people will continue to increasingly rent.

If you are considering selling your Stamford home, why not give us a call or Email us and we would be happy to help.