Number of pensioners in house shares triples in a decade
MELBOURNE: Sharing a flat with strangers used to be something people did at university or in their twenties, but such is the cost of renting nowadays that the number of pensioners in house shares has tripled over the past decade.
New data from Spareroom, the go-to website for lodgers, demonstrates the evolution of society, and the changing ways of how people live, over the past ten years.
The rapid increase in rents, particularly since the pandemic, means more students and graduates are remaining at home with their parents if they can, while older generations, unable to save for a deposit for a home of their own, are being kept in house shares for longer.
Data from Rightmove, the property search website, shows that rents in the UK have risen, on average, by close to 50 per cent since the start of the first lockdown.
The average cost of renting a one-bed flat across the UK is now £900 a month, according to Zoopla, another property search site. In London, it is closer to £1,900 a month.
Excluding student loan repayments and pension contributions, somebody earning the median full-time salary of £39,000 will generally take home around £2,600 a month.
Even to comfortably afford the average UK room rent of £749 a month, Spareroom thinks someone now needs to be earning at least £30,000.
In 2015, under-25s accounted for 32 per cent of all flat sharers, according to Spareroom, but that has dropped to less than 26 per cent, which it said was because the rapid rise in rents has created a “barrier to entry for younger renters”.
By contrast, the number of over-45s in flat shares, who historically would have moved out long before, either to rent solo or buy their own place, has been “quietly increasing”. Those aged 45 and over now make up 16 per cent of the market, up from 10 per cent in 2015.
Spareroom said the biggest increase has been among the oldest renters, albeit from a low base. Ten years ago, there were hardly any over-65s in flat shares — less than 1 per cent — but pensioners now account for 2.4 per cent of the flat share market.
The most represented age group in flat shares is still 25 to 34-year-olds but they are also in decline. They account for around 42 per cent of the market currently, down from 45 per cent a decade ago.
A Spareroom survey of more than 3,500 renters found that 38 per cent now live in “multi-generational households”, where the difference between the oldest and youngest flatmates is at least 20 years. Just shy of a quarter have, or are, flatmates with an age gap in excess of 30 years.
“Unaffordably high rents are shifting household dynamics as well as changing the geography of flat sharing too,” Matt Hutchinson, a director at Spareroom, said. “The youngest are being priced out of the rental market altogether, as older renters are priced out of home ownership or renting solo.
“The market adapts but the long-term picture is concerning, as the UK is not a country that’s geared towards renting for life. Those who haven’t built equity in property could be much worse off in their retirement years unless something changes dramatically.”