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Not all tenants live in the private rental sector out of necessity. Some people would rather rent a home than buy one. Where tenants live in the private rental sector by choice it’s usually because it makes sense for their lifestyle at that time.
Research has shown that the number of older people renting has increased. Many of them can afford to buy a property, yet they actively choose to rent, citing the flexibility and extra facilities homeownership can’t provide. Figures from the Office for National Statistics show that renters in the 65-74 age bracket now account for 9.3% of those in the private rental sector. A third of renters are now aged 35 to 45, whereas only 10% of people in that age bracket rented back in 1997.
Retirement Village Renters
Many retirement villages are now opening their doors to renters. McCarthy & Stone, one of the leading developers of retirement complexes now allows older people to rent apartments in their complexes, rather than buy. These complexes are suitable for older people with mobility issues, and if extra care is needed, care packages can be organised for an extra fee.
Such rentals are not cheap. Couples can expect to pay £911 per week. However, breakfast and one main meal a day are included, along with cleaning, laundry, and utilities. There are also facilities provided on-site, such as social events, exercise classes, and in some cases, pools, and gyms, rather like retirement villages in the US.
High-End Senior Rentals
Older tenants are also more likely to rent apartments in high-end property developments. These flats are luxurious and include top-spec communal facilities such as gyms and concierge services. Whereas flats like this were once only available to buy, developers have spotted a gap in the market for luxurious rentals and jumped in.
Many purpose-built high-end rentals are owned and operated by pension companies and large developers and run by professional management companies. Data from the British Property Federation reveals that there are currently 35,000 such developments in the UK, with another 110,000 under development.
One such development is Tipi in north-west London. Flats there cost up to £3,670 a month to rent, but they come fully furnished by John Lewis and parking and utilities are included. Similar developments in Salford are offered at between £900 and £1500 per month.
Such rents are typically 11% higher than the local average, but services like wi-fi are often included.
Why Are Older People Renting?
Whereas younger people tend to rent out of necessity, older people are choosing to rent to improve their standard of living. Because they often have equity in a property, they elect to release this and downsize. The downside to this is that once the equity runs out, rent payments will have to come from pension income, which might not be an option for some.
Because of this, it’s essential that older renters have provisions in place to fund their housing costs after retirement.
It is clear tenant demographics are changing. As the UK population ages and older people are increasingly choosing to live in rental homes, landlords can pivot their strategies and consider buying flats and renovating them to appeal to this demographic.
