No one wants to rent.........

Whilst we can all continue to guess about the economy, one thing that is?certainty is that our population continues to get older, just as it has done for the last 10 years.

The latest Census data points to where we are going, with over 11 million over 65s and 500,000 over 90, our ageing population continues to create challenges and opportunities.?Its not just the numbers though, it’s what the numbers show – all is not even. Its the areas that currently seem off the radar, As the Census shows us our population is polarising.

Can our aging and dated social care system be able to cope or does the crossover between generations and acute care system force us to grow up and change how we age and support older people to stay independent? Do new models of care and support pop up?

Integrated Retirement Communities are one element of the solution, but is a build to sell model the answer for all ages and needs??Does it make sense for everyone to stay on the ladder? Will market wobbles open up the rental tenure option and provide opportunity for institutional investment to really get into the ageing demographic like student housing and Build to Rent?

Rent, Rent, Rent

Rightmove has just release it latest stats and rents are rising across the residential markets, almost 12% year on year.?

My former colleague Nick Jones at Lottie has stated that google searches for retirement rental have risen significantly, 50% generally with 400% for bungalows and 950% for near the sea.

It’s a misnomer to say no one wants to rent.

Push or Pull?

With the next 12 months likely to be a bit of a roller coaster, will we see more push factors for rental, people needing and wanting the flexibility, alongside pull?

As happened in the US 25 years ago, a slowdown in the housing market may indeed push more people to look at rental. Care needs do not dissipate regardless of the economy.?Speed is critical for movers when a need arrives, able to access somewhere safe and secure as waiting may not be an option.?Factor in the opportunity for rent-to-rent opportunities and what that could mean for the market, the cost differential becomes more appealing.

For those staying at home, the rising cost of heating large underutilized homes, may be the final push into looking at options.?Scared by the prospect of soaring heating bills, downsizing may become more appealing. If you cannot sell because the housing market has slowed, you could try rental a you might not like it.?A try before you buy potentially or even getting off the ladder for good.

Costs of care homes are also rising as wages rise and costs continue to increase. For those that do not really need full care but may have considered it as the only option before, a retirement rental solution enable them to remain independent for longer.?This is before we reach the challenges of finding a home in some locations, but that's another day.

What's is potentially the most fascinating over the longer term is the rise in equity release amongst the over 65’s.?According to the Equity Release Council, 2022 we saw it rise to around ￡4.8bn up almost ￡1bn in 2021.?Whilst not startling in itself the potential down the line is will the sector be able to rely entirely on ownership, especially in the highly sought after mid-market. Do we need to be looking at other tenures now?

Pushing water uphill

But alas no one wants it you would be led to believe, because no one has built it.?We didn’t need the car as we had the horse and we didn’t need the iPhone as my Nokia did things fine.?In life we often don’t know we need it until we find out we need it.

Don’t take my word for it though.?Birchgrove continues to lease up their new schemes well, McCarthy Stone continues to offer its rental product and many established operators are leasing more. This is despite or whilst many of them remain a sales led organization where the marketing and sales pitch is very different.

I mentioned Lottie, but another referral agency has more enquiries for rental and low-cost options than they do for high end sales. For the mass market and self funders, there is little help other than google, especially where majority of equity and potential income is tied in the home.?

We all want independence. Many want a cost-effective options compared to care homes or something more than an apartment which doesn’t give us community in the same way and they are prepared to pay for it.

You could argue some of this is subjective, but its beginning to get hard to argue and our data points towards it. What is clear is that there is opportunity to do things different and critically for investors the interest is there from the end consumer as much as the funders themselves.?

The first step is maybe to start looking more at locations where and how people want to live.