Silver Renters Boom

Mike Cole

We’ve heard a lot about Generation Rent over the last few years. These are Millennials who have taken the lifestyle choice to rent a home as opposed to buying one. 

All quite logical considering how house prices, and particularly the size of deposit required, have made the idea of home ownership an unattractive proposition to many who would need to be saving much of their income for a couple of years, simply to be in a position to purchase.

What is creeping in more and more though is a ‘Silver Generation of Renters’. Over 50s are renting in bigger numbers than they ever have done before and that number is increasing year on year (according to evidence taken from Countrywide estate agencies across the country). It will be interesting to see how this pans out. My suspicion is that the outcome won’t be pretty.

That’s because I fear that for many, house sales have been used to access equity to retain or enhance a lifestyle. In doing so, the security of a way to downsize in later life or top up an inadequate pension provision is removed and the repercussions of that don’t make for attractive prospects. 

I hope I’m wrong. I hope it’s more a scenario of midlife separations and people wilfully deciding to rent in their droves rather than buy, while they wait and see what happens to the market pre and post-Brexit. I know we have clients who have taken that view. 

It does require serious discipline though not to dip into funds you may be sitting on that you can now access, that you wouldn’t have done had they been part of your house equity and much less easy to touch. It’s a real test of one’s ability to resist temptation. A test that based on the booming credit card industry of the last 30 years, evidence would suggest we’re not very good at passing.

We live in a time of “Want it. Can’t afford it. Still got to have it.” Those who have done well over the last twenty-five years from gains in property prices have been sitting on some very useful additional cash reserves. Reserves that keep temptation at bay most of the time.

Apart from the ‘wait and see’ thought process, there are other very good reasons why people would be choosing to rent…

There is an affordability argument on a month to month basis as to whether buying or renting is cheaper. In the more expensive locations, renting does tend to come out better. In fact, St. Albans was considered the best place to rent on a comparative scale to buying in the whole of the UK according to a Zoopla analysis last year. In most towns, there is not much in it either way though.

More powerful may be a flexibility argument, with people waiting to see how their personal circumstances materialise before committing to buy. Online daters are looking over wider areas for new partners and this changes the dynamic of where someone may end up living.

Interesting times ahead for sure…