Retirees revealed as fastest growing segment of private rented sector

Retiree renters and those in upper-middle age category are the fastest growing tenant groups in the private rented sector (PRS), according to new analysis from Paragon Bank.
 
A new report from Paragon, titled The Growth of Later Life Tenants, showed that the number of English households in the 55 to 64 year old age category in the PRS, with an assured tenancy, has risen by 118% since the turn of the last decade, with those aged over 65 growing 93%.

The research, based on responses from 2,000 UK tenants, revealed that this rate of growth is nearly double the rate of the next fastest growing segment, which is the 35 to 44 year-olds.
 
Paragon also suggested that later life tenants are “generally happier” in private rented accommodation than other age groups and have lived in the PRS for longer.

Sixty-eight per cent of over-55s indicated that renting suited their needs or that they enjoyed renting, compared with 49% in the under-55s group. A majority (63%) also said they were pleased they don’t have to worry about repairs.
 
“There are a number of factors that may have contributed to the increase in over-55s in the PRS over the past 10 years, such as rising divorce amongst older people, poorer pension returns and men living longer,” said Paragon managing director of mortgages, Richard Rowntree.
 
“With the number of over-55s forecast to rise from 30% of the population to 36% by 2043 and new household formation predicted to be driven by older, single person households, the PRS will have an increasingly important role to play in providing a home for older tenants.”

The research also showed that over-55s represent 16.2% of privately rented households, which has steadily grown since the turn of the decade, when 11.3% of the sector was made up of over-55s.
 
Paragon said that landlords appear to be responding to this change in demand – with 21% expecting to let more to older singles in the future, and 20% expecting to let to retirees. This was second only to letting to professionals or companies.

Rowntree added: “Landlords are already reacting to the changing demographics of the PRS and with older tenants becoming more commonplace, will have to increasingly do so. Landlords will need to consider longer tenancy agreements, the location of their property and any adjustments the property may need for later life tenants.”

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