Yes, that number is staggering isn’t it?!
Of the 5,803 households in Runcorn where the head of the household is 65 years or older, an astounding 3,734 (or 64.3%) of those are owned, which is below the national average of 74.1%, which sounds great – yet nothing could be further from the truth.
I chat with many Runcorn pensioners who would like to move but cannot, as there is a scarcity of such properties for Runcorn mature people to downsize into. Due to their scarcity and high demand, Runcorn bungalows on average get a 12% to 22% premium per square metre premium over two-storey properties. To add insult to injury, a recent NHBC reported that only 1% of new builds in the country were single-storey bungalows (compared to 7% in the mid-1990s).
Runcorn OAP’s are sitting on £508.1m of equity in these Runcorn homes.
In a survey conducted a couple of years ago by YouGov, they established that just over one-third of homeowning people aged 65 and over in the country were looking to downsize into a smaller home. Yet, the Tory’s over the last nine years have appeared to target all their attention on first-time buyers with stratagems such as Starter Homes to safeguard the youngsters of the UK not becoming perpetual members of ‘Generation Rent’. Equally though, this doesn’t address the long-lasting under-supply of suitable retirement housing essential to the needs of the Runcorn’s hastily ageing population. Lamentably, Runcorn’s housing stock is tragically unprepared for this demographic shift to the ‘overextended middle age’, and this has created a new ‘Generation Confined’ quandary where older people cannot move.
Also, those older Runcorn retirees who live in the limited number of Runcorn bungalows are finding it difficult to live on their own, as they are unable to leave their bungalow due to a lack of sheltered housing and ‘affordable’ care home places.
Meaning those older Runcorn retirees can’t leave their Runcorn bungalows, while younger Runcorn retirees in their larger two-storey family houses can’t buy those Runcorn bungalows (occupied by the older retirees). People of Runcorn in their 30s and 40s can’t buy those larger two storey family houses (occupied by the younger retirees) which they need to for their growing families. It’s like everyone is waiting for everyone because of the bottleneck at the top.
For those wanting to see the complete stats for Runcorn as whole:
Runcorn OAP’s by Tenure of their Home
|Living Rent Free
Runcorn’s (and the rest of the UK’s) property prices have soared over the last 50 years because the number of properties built has not kept up with demand. With restrictive planning regulations, migration, people living longer and excessive divorce rates (meaning one family becomes two) the country needs 240,000 properties to be built a year, since the millennium, to just stand still.
At the turn of the millennium, the country was constructing on average 180,000 to 190,000 households a year. That figure dropped in the five years after the credit crunch to 135,000 and 145,000 households a year. Although we built 217,000 last year, we still have all those 19 years to make up for.
The answer?: Allow more land for starter homes, bungalows and sheltered accommodation because land prices are stifling the property market. Large building firms are more likely to focus on traditional houses and apartments than bungalows (because they make more money from them).
My thoughts for the savvy Runcorn property investors – until the government change the planning rules and allow more land to be built on – Bungalows, especially ones that need some TLC after someone has passed away, are a great bet for flipping. They could even offer potential rental returns for future property investment as more and more OAP’s will be renting in the decades to come.