Friday, 13 January 2017

12.5% of Falmouth People Live in a Shared Household

I had an interesting chat the other day with a Falmouth landlord. She said she had been talking with an architect friend who said back in the mid 2000's he was being consulted on the building of mostly one and two bed properties. This compared to today, where the majority of the buildings he is designing are three and four bedroom properties as well as extensions to accommodate more bedrooms. Now, this was all anecdotal of course, but it made me think if similar things were actually happening in our local property market?
We have long observed that there is an inequity between supply and demand. Knowing or predicting the dynamic of both will help inform what property type is the best buy for landlords. That is of course if they offer a decent return!!
In 2001, there were 214,800 households with a population of 499,100 in Cornwall. By 2011, that had grown to 230,400 households and a population of 532,300.

.. meaning, between 2001 and 2011, whilst the number of households in the Cornwall grew by 7.25%, the population grew by 6.64%

Nothing surprising there then! My analysis of the 2011 Census results, using the most recent in-depth data on household formation (eg households), has indicated a sudden and unexpected break with the trends of the whole of the 20th Century. Indeed there has been a seismic change in household formation in Falmouth between 2001 and 2011.
Between 2001 and 2011, the population of Falmouth grew, as did the number of Falmouth properties. The average household size in the two decades remained almost exactly the same. This is interesting in itself, since the first time for at least 100 years it had not fallen between censuses. Since 1911, household size has decreased by around 20% every decade.

Looking at figures specifically for Falmouth itself,

  • One person households  - 33.1%

  • Couples/family households - 54.4%

  • Couple + other adults/multi-adult households - 12.5%

This decline was reflected in large scale shifts in the mix of household types. In particular, there were far more couples + other adults households and multi -adult households. 12.5 % is a lot of households! It means approx. 1 in 8 households are multiple occupancy households (where adults are mostly unrelated) This shift is due to a number of things happening locally.
  1. Increased international inward migration, which has changed the traditional household structure. There is a culture of migrants from EU countries like Poland, Latvia and so on where adults happily share houses in order to save money.

  2. Increases in adult children and their partners living at home. Little surprise here as the young generation of local people are finding it virtually impossible to get on the housing ladder in the same numbers as their parents did in the 80's and 90's.

  3. Growth in the student population. Enough said.

We suspect that the trend will continue since there appears to be no slow down in international in-migration. There is no abatement in house price increases; consequently unless we all win on the lottery our kids will still find it difficult to get on the property ladder. Instead they will stay at home or live communally with friends in ever greater numbers. Finally student numbers are only going one way!

So, what does all this mean for Falmouth Homeowners and Landlords? Quite a lot in fact. There has been more than a subtle shift to slightly larger households in the last decade, meaning smart landlords might be tempted to buy slightly larger properties to rent out. This is good news for homeowners who will get top dollar for their home as they sell on in a limited supply market. It will only be good news for landlords if they can buy something that will give them the return. The purchasing power of students and of young people living together is strong.

All the statistics are from Office of National Stats specifically relating to Cornwall. Also reference from Town & Country Planning Tomorrow Series Paper 16 new estimates of housing demand and need in England, 2011 to 2031 by A. Holmans 






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