First Time Buyers Are Getting Older: I don’t just mean they’re edging up a little in response to higher deposits and house prices – I mean they’re getting seriously older because of the way many people have deliberately rented in the early part of their lives.
So according to the Nationwide the average first time buyer is now 32 years old, but separate figures from the Financial Conduct Authority show that in 2022 (the latest data) there were 12,000 first time buyers over the age of 50 in the UK – this ‘older FTB’ is one of the fastest growing segments of the housing market right now.
First Time Buyers Are Teaming Up: You may have seen reports here on Estate Agent Today that almost two-thirds of people taking their first step on the housing ladder in 2023 made joint applications for mortgages. Some were traditional couples, of course, but others were friends or even parent-and-offspring recognising that the most affordable way to buy a home today is to pool resources.
More generally there’s a demographic explosion happening – and relatively quickly – with our Increasing Population. Government forecasts suggest the UK population could reach nearly 74m as soon as 2036.
The Office for National Statistics projects that by 2036 another 10.8 people will have been born in the UK and 10.3m will have died; meanwhile, 13.7m people will immigrate long term to the UK while 7.6m will emigrate long term from this country.
Meanwhile, more government figures suggest that while in 2020 there were 1.7m people in the UK aged 85 or over, representing 2.5 per cent of the population, this will nearly double to 3.1m (or 4.3 per cent of the population) by 2045.
And while we often think of couples and families in relation to property needs, this traditional family shape won’t necessarily be the dominant household size in future.
In 2022, over 28.9m people in England and Wales were single compared with 24.0m who were married. Some of those single people were co-habiting of course but even of those couples who were married, some 42 per cent are likely to divorce or separate in the future.
You get the drift I am sure – we’re no longer dealing with one or two ‘types’ of buyer, seller, tenant, or landlord. And agency has to change to keep up with this dramatic movement.
Here are some ideas: they are mostly driven around recognising that our industry is a true people business, so speaking the right language (in every sense) is vital as the population and expectations of customers change.
I know many agents are already thinking along these lines, so my apologies if you’re ahead of me on some of these ideas.
– have informal specialists in the office, possibly driven by their own experiences: for example, someone who’s been through a divorce knows exactly how quick people may need to move, how shattered they may be by the experience, and what pitfalls they risk if they make a hasty or financially unwise decision over their next property move;
– likewise older negotiators may be best placed to deal with an increasingly older client list that is likely to be every agency’s experience in the next decade;
– a fast-expanding population, mostly from inward migration, will undoubtedly put pressure on the private rental sector. Agencies would be wise to plan expansion into rentals, either buy to let or working with Build to Rent operators. This isn’t just because rental is an alternative revenue stream but because it may be the main tenure for some agents. In some big cities today, renting (private and social) is the tenure now for 40 per cent of the population – it could be 50 per cent or more in the not-so-distant future;
– consider different languages, too. Several agency branches now have Polish speakers or someone fluent in one or more Indian Subcontinent languages. Of course, the need for these will vary from place to place and over time but these days at the very least it’s easy to use technology to translate written documents into different languages;
– which brings us to PropTech. We’ve spoken many times of how younger people want communication via a mixed economy of social media and email more than, say, voice calls or office visits. Artificial Intelligence may be about to take all to a different level. It’s as frightening as it’s exciting, but it could well be a way of serving an increasingly diverse and demanding customer base. Don’t fight it but embrace it to win business!
Our industry has been fantastic at turning challenges into opportunities, and these demographic changes and how we handle them may be our biggest challenge yet.
The challenge is not meant to depress but to liberate – it gives us a chance to serve our growing communities and cement our place in a changing world where the search for accommodation will become ever more important. All change – and we need to keep up!
