With many Colchester tenants not able to buy their own property, my research suggests the increasingly important role the private rented sector plays housing people who need a roof over their head. At a time when first time buyers are finding it harder than ever to afford their own property and social housing providers (local authorities and housing associations) are facing growing difficulty securing funding from Westminster faced with competition from Bovis, Taylor Wimpey and all the other large house builders to buy expensive building land in Colchester.
Renting isn’t like it was during the 1960’s and 70’s when tenants couldn’t wait to leave their rack-rent landlords, many charging sky-high rents for properties with Second World War wood chip wallpaper, no central heating and draughty windows. Since 1997, with the introduction of buy to let mortgages, a new breed of Colchester landlord emerged and the private rented sector has offered increasingly high quality accommodation for younger Colchester tenants.
Although I knew from experience the social class of tenants in Colchester has steadily moved upwards over the last few decades I didn’t have any facts to back that up – until now. According to some detailed statistics from Durham University just released for the Colchester Borough Council area, the current situation regarding social status of Colchester tenants reveals some very interesting points. Using the well known Demographic ABC1 grade classifications which refer to the social grade definitions (used to describe, measure and classify people of different social grade and income and earnings levels, for market research, social commentary, lifestyle statistics, and statistical research and analysis) here’s what I found out.
Of the 20,637 tenants who live in private rented properties in the Colchester Borough Council area 15.58% (3,215) of Colchester tenants are classified in the AB category (Higher and intermediate managerial / administrative / professional occupations), compared to 27.24% owner occupiers who own their property without a mortgage or 4.20% who rent their property from the local authority. It’s fascinating stuff isn’t it?
National Readership Survey (NRS) Social Grades
|Grade||Social class||Chief Income Earner’s Occupation||Frequency (2008)|
|A||Upper middle class||Higher managerial, administrative or professional||4%|
|B||Middle class||Intermediate managerial, administrative or professional||23%|
|C1||Lower middle class||Supervisory or clerical and junior managerial, administrative or professional||29%|
|C2||Skilled working class||Skilled manual workers||21%|
|D||Working class||Semi-skilled and unskilled manual workers||15%|
|E||Non working||Casual or lowest grade workers, pensioners, and others who depend on the welfare state for their income||8%|
Looking deeper into the stats the C1 category (see table) shows an impressive 8,967 of the aforementioned 20,637 Colchester tenants are considered to be in the C1 category, which works out 43.45%
Again, when compared with owner occupiers who own their property without a mortgage, that figure stands at 32.42% and 16.14% who rent their property from the local authority. So, using the conventional measurements recorded by the white-collar “ABC1” i.e. middle class:
Over 59% of Colchester tenants are considered middle class
I could go through all of the social categories but I don’t want to bore you with too many numbers. The bottom line is clear; private tenants are moving up the social ladder and while traditionally the private rented sector has been seen as a temporary tenure for 20 somethings, before they buy a property, the increase in renting in Colchester (which I have talked about many times in the Colchester Property Market Blog) may reflect the increasing difficulty this group is finding to access other tenures. Alternatively it may be because people in Colchester rent, by choice, over the longer term.
Landlords need to be aware that Colchester tenants now demand more from their properties, the agent and their landlord and whilst affordability for first-time buyers and tighter controls on lending may mean that potential first-time buyers are in the private rented sector for longer, they will still pay ‘top dollar’ rent for a ‘top dollar’ property.
If you’d like an informal chat about any aspect of investment in the Colchester property market please give me a ring on 01206 862288 or email firstname.lastname@example.org – I’m always happy to offer a without obligation second opinion. Send me a link to any property on Rightmove or Zoopla you are interested in and I will get back to you, usually within 24 hours. I am also happy to undertake free pre-purchase visits to your shortlist of potential properties to provide a rental valuation.