Oakham Property Market Crisis

The UK has a reputation for being a nation of homeowners, but in a league of the top 46 economic nations of the world (where owning your property is permissible), the UK is only ranked at no.37. 

As I mentioned a couple of weeks ago, at the end of WWI, 77% of people rented their home, with the vast majority renting from a private landlord as council housing was still very much in its infancy.

 

 

 

Homeownership rose very slowly in the 1920’s and started to increase as the economy grew after the ‘Great Depression’.  However, after the Luftwaffe had flattened huge swathes of housing in the early 40’s, the priority was to get people into clean and decent accommodation.  So, local authorities (councils) took up the baton and they built large council estates in the 1950’s and 1960’s.

As the UK economy got back on its feet in the middle part of the 20^th Century and wages rose, people decided they wanted to own their own home instead of renting one.  Throughout the post war decades, it became easier to secure a mortgage.

Interestingly, by 1977, 61.6% of 30-34 year olds were mortgagees or ‘owner occupiers’, compared to 8.7% of 30-34 year olds residing in private rented accommodation (the remaining either being in council housing or living with friends or family).

Ten years later, in 1987, we saw some significant growth in homeownership, as 68.2% of 30-34 year olds had a mortgage and only 4.6% of people privately rented.  A decade later and there wasn’t much change as, in 1997, the homeownership figure was 68.3%, but private renting had jumped to 12.1% in the same 30-34 year old age group.

Move on another ten years to the 2007 figures, and this showed a slight drop in homeownership to 65.8%, but renting had continued to increase to 18.7% (in the 30-34 year old age group).

The latest set of figures available is for 2014, and only 47.2% of 30-34 year olds have a mortgage and an eye watering 33.4% of 30-34 year olds privately rent.

When we study the Oakham homeownership figures, looking back to 1991, 68.37% of Oakham households were owned by the homeowner, whilst 7.09% of Oakham households were privately rented, whilst the 2011 census showed home ownership in Oakham had risen to 72.53% and private rented had increased to 14.25%.

Much of the recent rise in the occurrence of private renting in Oakham since the turn of the millennium is not as a result of expensive property, but the fact these 30 somethings haven’t got a council house to move into (because they were all sold off) – so they have to rent.

Selling off council housing in the 1980’s (a subject I have talked about in a previous article in the Oakham Property Market Blog) artificially grew homeownership in the 1980’s, but as these people have got older, the younger generation didn’t have the same opportunities to buy their council house in the 1990’s, 2000’s or 2010’s.

That is why, unless the council start building council houses by the acre, and hundreds of acres, private renting will continue to grow in Oakham.

To find out more on the Oakham property market and for my popular weekly choice of the ‘3 best buy-to-let property deals’ in the area, visit www.rutlandandstamfordpropertyblog.co.uk