If you are the landlord of buy to let property, there is one sector of your market which you might have overlooked – recent research suggests that more and more people are selling up property they may have owned in the past in order to rent their home during their retirement.
In its edition of the 18th of July 2017, the Telegraph newspaper took up the story of older people turning to the private rented sector in order to avoid the escalating costs of maintaining the home they previously owned and because of the difficulties they encountered in trying to downsize.
The general uncertainties of the housing market were also making it difficult for older renters to sell up and buy property closer to the families and loved ones with whom to share their years in retirement.
The upshot has been a 13% increase in the past four years of retirees and older people moving into private rented accommodation – as we reported here on the 24th of July 2017.
No place in the sun
Also fuelling the recent increase in numbers of older renters may be the growing disenchantment with a good life in the sun once offered in countries such as Spain and Portugal – with a total of some 1.2 million living in various countries throughout the EU.
The volatility of property prices and property regulations already introduced in many favoured retirement spots are now likely to see still further uncertainty as a result of Britain’s Brexit from the EU.
The value of retirement pensions has plummeted as a result of the much weaker exchange rate for sterling, whilst access to adequate healthcare of course remains a major concern for the elderly – 70,000 British retirees depend on care from Spanish health services (compared to just 81 Spaniards who rely on the NHS), reported the Guardian newspaper on the 15th of April 2017.
The longer-term, effects of Brexit in the immediate future for those who continue to choose to retire abroad remains very uncertain.
All of this may be lending weight to increasing numbers of older renters turning to the private sector at home in the UK.
Letting to older renters
These developments may be good news if you are the landlord of buy to let property – any increase in any sector of your potential market is likely to be welcome.
What are some of the considerations you might want to take into account if you are letting to older renters?
Older people and those already in retirement are generally likely to be more responsible – and lead a quieter life – than those who are young, single or with young families. If older renters represent a lower risk of loss or damage to your let property, therefore, you might reasonable expect this to be reflected in lower premiums for your landlord insurance.
On the other hand, you may find that older renters are more demanding in the standards of accommodation you offer and are less likely to accept tired or worn-out furnishings, fittings and appliances.
You might also want to bear in mind that those who have retired are on a fixed income – which might not always reflect the effects of inflation – and your ability to increase rent levels, whilst retaining the same long-term tenants, may be limited.