Landlords need tenants and people need homes; it is this simple premise which keeps the private rental sector growing.
And the sector’s growth has been staggering; nationally, the PRS grew by 83.89% in the 10 years between 2001 and 2011 – but in Lincoln the growth was even more impressive, at 125.85% over the same period.
This is encouraging news for property investors and landlords, but the key to success is to supply exactly what the consumer demands. This is why understanding the population in your area is so important; it can give you so much information about who lives in the city, the types of property they are likely to want, and where they will want to live.
People are getting married later, according to the Office for National Statistics*, and the number of single people is increasing**, putting a greater demand on our property stock than in the past as it means more people are living alone, so more properties are needed.
This trend also means people are more likely to need to rent at some point in their lives – whether long-term or just for a year or so after splitting up with a partner, while they get back on their feet.
But just because more people are living alone doesn’t mean they want one-bedroomed flats; divorced parents, for example, will require one or more spare bedrooms to accommodate their children when they visit, and perhaps a garden for them to play in, or easy access to parks.
Overall, in the UK, we have an ageing population; the Office of National Statistics reports*** that in 2016, 18% of the population were aged 65+, and 2.4% aged 85 and over. Theoretically, it would therefore make sense to aim properties at older people, especially as there is an additional trend for older people to rent.
However, general trends don’t always apply, so knowing your local market is essential. For example in Lincoln we buck the trend, with fewer people aged 65+ (15% of the population) and more than two thirds of the population being of working age. This makes it an area where people are highly likely to want to rent property, before maybe buying their first home and starting a family, especially as affordability for buying and renting in Lincoln is better than most other areas in England.
One of things I do when thinking about what to buy and who to target from a rental perspective, is to consider what types and where the areas of employment are. In Lincoln the core sectors are tourism, retail, leisure and education. This means working people are likely to want to live in places where it’s an easy commute to the city centre and indeed the two universities.
The make-up of the population clearly has a major influence on demand for property and it is this information which helps to work out what and where to invest in Lincoln. So if you are thinking of expanding your portfolio or buying your first investment, do come and talk to me so I can help match your investment plans to the particular demands of local Lincoln tenants.