Bicester Millennials were born between the mid 1980’s and late 1990’s thus making them between the age of around 22 to late 30’s. They are the imaginative, artistic youngsters who grew up with the newest technology such as iPhones, iPads and who are partial to music festivals, Nando’s, emoji’s, selfies and old school nostalgia. Also known as Generation Rent, many Millennials have discovered that renting is a good choice for their shelter and accommodation needs without the hassle that comes from buying a home. Nonetheless, that is not the only reason they don’t buy property. When they should be concentrating on their profession, putting down roots and starting a family, many Millennials are still going through the pressure and strain of student loan liabilities whilst, at the same time, finding it tough to pay rent.
The hot topic at the moment is the cost of renting, as both political parties have seen mileage in woo-ing these Millennial Generation Renters. The average rent in Bicester is currently £1,045 per month making this a big-ticket item on the monthly budget. I was inquisitive to find out exactly how much Bicester Millennials will spend on rent by the time they reach their mid 30’s. The average age people leave home in the UK is 22; so looking at a Bicester 22-year-olds who left home in 2005, they will have shelled out £149,265 in rent.
It’s no wonder local Millennials can’t afford to buy a Bicester home given their tremendous debt. This means younger Bicester Millennials will probably carry on renting for the foreseeable future, simply because the prospect of buying a home is not yet achievable. That is until you look more deeply at the numbers!
Looking at the chart above, the average rent of a Bicester property in 2005 was £860 per month. If it had risen by inflation, today that would be £1,211 pm. As I have mentioned earlier in the article, today it only stands at £1,045 per month. Looking over the last 12 years, adding up all the differences between what the average actual rent was compared to what it should have been if rent had gone up by inflation, the average Bicester Millennial tenant would have paid £162,664.
This means that an average 35-year-old Bicester Millennial tenant, who has been renting since 2005, is better off by £13,399 when comparing the actual rent paid compared to what it would have been if it had risen by inflation. In a nutshell, tenants have done well due to the sub-inflation growth in rents.
In fact, if you recall I mentioned in an article a few weeks ago, the older Bicester Millennials are starting to use those savings and are gradually shifting towards home ownership. They are finally catching up with the british homeownership dream as bank of Mum and Dad help with the deposit. Also, the scrapping of stamp duty from the government starts to kick in together with the realisation that if the 5% mortgage deposit can be achieved it is still a lot cheaper to buy than rent, meaning this will unquestionably drive demand for Bicester homes for sale – good news for Bicester homeowners.
What does this mean for Bicester landlords?
Well the vast majority of younger Millennials are still renters and I foresee this to be the case for at least the next ten to fifteen years. Landlords will need to keep improving their properties to ensure they get the best tenants and they will see a much higher rent achieved. Millennials Are willing to pay top dollar for a premium property. It is important to do things correctly as making money won’t be as easy as it has been over the last twenty years. As a greater number of properties comes on the market, also comes greater choice. Don’t buy the first thing you see, buy with your head as well as your heart, because as I promised a few weeks ago, the first rule of Buy To Let Investment….
“You are not going to live in the property yourself”