A new social study from property concierge platform, Moveable, indicates that millennial Brits now have wholly different objectives when buying their first home.
Leveraging capital for property has become the top priority for buyers. However, when it comes to owning bricks and mortar, investing for developments is now trumping dwelling.
Research from The English Housing Survey reveals that 35% of Brits who own a second home are using it as a long-term investment and source of income. In addition, the total assets for UK property owners from second homes – including buy-to-let investments and overseas property – has risen in value from £610 billion in 2001 to almost £1 trillion in 2019.
With such favourable financial returns that come with being on the property ladder, it is not surprising that UK millennials now perceive the property market as a viable means for a secure secondary income, over and above a place to call home. The effects of the pandemic are likely to have assisted with igniting a new generation of home-buying patterns, as COVID has transformed our outlook on housing, our careers, and lifestyle.
When analysing the UK property market at a macro-level, it is clear that house prices still remain robust throughout the UK. The average house price has continued to reach new heights, now sitting at £354,563, according to the Office of Budget Responsibility. In tandem, the UK ABC1 population has seen a steady rise in disposable income, with a “richer” workforce seeing an average yearly household income increase to around £31,772 in 2021.
Moveable’s study is reflective of a generation that has the highest earning capacity we’ve seen this lifetime. The data reveals that new home-buying motivations have become increasingly lucrative and entrepreneurial, particularly in a sector where the climb in average property prices shows no signs of slowing down. Instead of owning a home purely for security and residential purposes, homebuyers are likely investing in multiple properties with the intention of receiving another stream of income.
Delving into Moveable’s data further, 14% of Brits are looking to buy a house to develop in the next year. This number rises to 40% for those aged 18 to 34. 15% are looking to buy a house to refurbish for themselves in the next year. This number rises to 40% for those aged 18 to 34. 14% are looking to buy a house as a source of passive income in the next year. This number rises to 25% for those aged 18 to 34. 20% of Brits are looking to buy a house in the next twelve months. This number rises to 32% for those aged 18 to 34. 28% of Brits are looking to get onto the property ladder before starting a family. This number rises to 50% for those aged 18 to 34.
Simon Bath, CEO of iPlace Global, comments: “Houses are way more valuable now than they used to be, and with that comes investment opportunities for those looking for another form of income generation.”