Middle-aged households that privately rent have jumped by 70% over a decade, a report from Paragon Bank shows, “with many set to remain in rented homes for the long term”.
The number of households in England where the lead reference person is aged between 45 and 64 has lifted to 1.18 million in 2021, from 691,000 in 2011, a bigger jump than any other age group, according to the lender’s analysis of government data, such as the 2021 Census, and its own polling of 2,000 tenants.
Its survey shows that while the desire to own a home is high among the 45-64 age group, “the ability to buy is inhibited”.
It reveals that 47% would like to buy their own home, yet only 19% are actively saving towards buying a property.
Of the 19% actively saving to buy a home, 25% have their finances in place and are searching, with 4% in the process of purchasing. The other 71% say they are in the savings phase.
The study says another issue facing this group is income.
Just 14% of those in the 45 to 64 age bracket have an annual income over £50,000, with a quarter earning less than £10,000 per year and a similar proportion earning between £30,000 and £50,000, “inhibiting the ability of tenants in this bracket to save for a deposit and limiting their ability to obtain and service a mortgage”.
It also adds: “Tenants aged 45 or over have been renting for longer, have lived in more properties and tend to stay longer in the same home than those younger. They are also more likely to live alone when compared to a younger cohort.”
The report says 22% of those between 45 and 64 have lived in privately rented accommodation for more than 15 years, with a further 17% in the sector for between 11 and 15 years.
By comparison, those under 45 typically have spent less time in rented homes, with nearly seven in 10 living in the sector for less than five years.
The study adds that 23% of over-45s have lived in their current rental home for more than 10 years, with 22% living in the same home for between five and 10 years, which “suggests that older tenants view their rental home as long-term accommodation”.
It also points out that over the last ten years the number of households aged 65 or over who rent privately jumped by 38%, with those aged between 34 and 44 rising by 21%. The 16- to 34-year-old group rose by just 3%.
Paragon Bank managing director of mortgages Richard Rowntree says: “There is a perception that the private rented sector is home to the young when, in fact, over half of tenants are aged over 35 and the greatest increase in the number of households is in the middle-aged 45 to 64-age bracket.
“Too much policy focus is on getting younger tenants on the housing ladder. While this is important, the government should also consider the need to provide a home to older tenants who live in the private rented sector for the long term.
He adds: “Just a fifth of 45- to 64-year-olds are actively saving towards buying a house, which suggests that they will remain in rented accommodation for the long term.
“This has implications for the types of property that this group will live in as they age. For example, there may need to be an increase in one or two-bedroom properties and landlords will need to be open to property adaptions. Ensuring there is a supply of property in the private rented sector to cater for their needs is vital.”
