The argument of migration and what it does, or doesn't do,
for the country’s economic well-being is something that has been hotly contested
over the last few years and more so recently. In my article today, I want to
talk about what it has done for the Solihull Property market.
Before we look at Solihull though, let us look at some
interesting figures for the country as a whole. Between 2001 and 2011 971,144 EU
citizens came to the UK to live and of those, 171,164 of them (17.68%) have
bought their own home. It might surprise people that only 5.07% of EU migrants
managed to secure a council house. However, 676,091 (69.62%) of them went into
the private rental sector. This increase
in population from the EU has no doubt added great stress to the UK housing
market.
Looking at the figures, the housing market as a whole is undoubtedly
affected by migration but it has been the private rented housing sector,
especially in those areas where migrants come together that is affected the
most. Indeed I have seen that many EU
migrants often compete for such housing not with UK tenants but with other EU migrants.
In 2001, 3.68 million rented a property from a landlord in the UK. Ten years later in 2011, whilst EU migration
added an additional 676,091 people renting a property from a landlord, there
were actually an additional 4.14 million people who became tenants and were not
EU migrants, but predominately British!
As a landlord it is really important to gauge the potential
demand for your rental property, especially if you are a landlord who buys
property in areas popular with the Eastern European EU migrants. To gauge the level of EU migration (and thus
demand), one of the best ways to calculate the growth of migrants is to
calculate the number of people who ask for a National Insurance number (which
EU members are able to obtain).
Interestingly in Solihull, migration has stayed quite static
over the last few years. For example, in 2006 there were 612 migrant National
Insurance Cards (NIC) issued and the year after, in 2007, 688 NIC cards were
issued. In 2014 this was 660 NIC’s. However,
if the pattern of other migrations since WW2 continues, over time there will be
an increasing demand for owner occupied property, which may affect the market
in certain areas of high migrant concentration. On the other hand over time
some households move into the larger housing market, reducing concentrations
and pressures.
In essence, migration has affected the Solihull property
market; it couldn't fail to because of the additional 5,410 working age
migrants that have moved into the Solihull area since 2005. However, it has not
been the main influence on the market. Property values in Solihull today are
only 8.41% higher than they were in 2005. According to the Office of National
Statistics, rents for tenants in the West Midlands have only grown on average
by 0.75% a year since 2005.... I would say if it wasn't for the migrants, we
would be in a far worse position when it came to the Solihull property market.
This was backed up by the then Home Secretary Theresa May back in 2012 - more
than a third of all new housing demand in Britain is caused by inward migration
and there is evidence that without the demand caused by such immigration, house
prices would be 10% lower over a 20 year period.
If you want to know more about the Solihull property market, please pop into property lounge for a drink, chat and to meet the lovely time.
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