I was having an interesting chat with a Rotherham buy-to-let landlord the other day when the subject of size of households came up in conversation.

For those of you who read my Brexit article published on the morning after the referendum, one of the reasons on why I thought the Rotherham property market would be OK in the medium to long term, was the fact that the size of households in the 21st Century was getting smaller – which would create demand for Rotherham property and therefore keep property prices from dropping.

Looking at the stats going back to the early 1960s, when the average number of people in a home was exactly 3, it has steadily dropped by a fifth to today’s figure of 2.4 people per household. Doesn’t sound a lot, but if the population remained at the same level for the next 50 years and we had the same 20% drop in household size, the UK would need to build an additional 5.28 million properties (or 105,769 per year).

When you consider the country is only building 139,800 properties a year it doesn’t leave much room for people living longer and immigration to the UK.

Looking closer to home, in the Rotherham Metropolitan Borough Council area, the average number of occupants per household is 2.4 people.

When we look at the current picture nationally and split it down into tenure types (i.e. owned, council houses and private renting) a fascinating picture appears.

The vast majority of homeowners who don’t have a mortgage are occupied by one or two people (81% in fact), although this can be explained as residents being older, with some members of the family having moved out, or a pensioner living alone. People living on their own are more likely to live in a Council house (43%) and the largest households (those with 4 or more people living in them) are homeowners with a mortgage – but again, that can be explained as homeowners with families tend to need a mortgage to buy. What surprised me was the even spread of private rented households and how that sector of population is so evenly spread across the occupant range – in fact that sector is the closest to the national average, even though they only represent a sixth of the population.

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When we look at the Rotherham Metropolitan Borough Council figures for all tenures (Owned, Council and Private Rented) a slightly different picture appears…

1 person households 2 person households 3 person households 4 person households 5+ person households
28.54% 35.69% 16.46% 13.15% 6.16%

But it gets even more interesting when we focus on just private rental properties in Rotherham, as it is the rental market in Rotherham that really fascinates me. When I analysed those Rotherham private rental household composition figures, a slightly different picture appears. Of the 11,153 Private rental properties in the Rotherham Metropolitan Borough Council area,

  • 31.4% of Private Rental Properties are 1 person Households
  • 32.0% of Private Rental Properties are 2 person Households
  • 17.7% of Private Rental Properties are 3 person Households
  • 11.1% of Private Rental Properties are 4 person Households
  • 7.5% of Private Rental Properties are 5+ person Households

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As you can see, Rotherham is not too dissimilar from the national picture but there is story to tell. If you are considering future buy to let purchases in the coming 12 to 18 months, I would seriously consider looking at 1 or 2 bed apartments/houses. They have to be in the right part of Rotherham and priced realistically, but they will always let and when you need to sell, irrespective of market conditions at the time, they should be the target of buyers.

Even with the numbers stated, there are simply not enough 1 or 2 bed apartments/houses to meet the demand.


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