This month marks a decade since the international banking crisis that saw a major US bank collapse, unemployment sharply accelerate, and the UK economy shrink.
However, ten years on, and it’s becoming increasingly clear what the longer-term repercussions have been for the Millennial generation. According to a report released recently by the Institute for Fiscal Studies (IFS), earnings for all workers are lower in real terms than they were in 2008. However, it is those now in their thirties who have been the hardest hit with the wages of this age group being around 7% lower than they should be when taking account of pre-crash rates of growth.
Additional analysis by the IFS in February found that in 2016, just 42% of those aged 30-34 are homeowners, compared to 60% of the same age group ten years earlier - meaning this age group are now most likely to be renting in the private rented sector. However, the average age of a first-time mother is 28, and so we should expect the lifestyles and housing needs of the Millennial generation begin to change.
The benefit of investing in a family home
The trendy apartments the Millennials choose as a twenty-something’s may not be suitable for growing families and instead these tenants will be looking to live in nice, family friendly neighbourhoods. Homes close to good schools, and features such as gardens and separate dining rooms will be higher up on their wish list.
With supply of such homes sometimes limited, once a tenant has found and secured their perfect home, they’ll have little desire to move regularly. They will be more inclined to stay in their perfect home throughout the duration of their children’s education - and as such are likely to treat their rented property with as much care as they would their own home. This is the generation that has spent much of their adult life renting and they’ll be keen to protect both their deposit, and their credit record.
Meanwhile, a carefully selected investment is likely to enjoy positive property price growth over the longer term. Therefore, when you are in a position where you would like to sell, then you’re likely to have an asset that has been well cared for and has grown in value.
If you’re ready to invest
We have expert local knowledge of both the sales and lettings market. We know the respected neighbourhoods that are most likely to enjoy strong price growth, and we know the schools that parents are keen for their children to attend. We also understand tenant demand in our local markets.
If you are ready to invest, then speak to your local Darlows branch, or contact our Investor Services Team at InvestorServicesTeam@spicerhaart.co.uk and we can help identify suitable.