15.8% of Oxford People live in Shared Households

How does a canny landlord establish the shape of future demand, so she/he buys the right type of property?  As knowing when and where the demand of tenants is going to come from in the coming decade is just as important as knowing the supply side of the buy to let equation, in relation to the number of properties built in Oxford, Oxford property prices, Oxford yields and Oxford rents.

In 2001, there were 51,700 households with a population of 134,200 in the Oxford City Council area. By 2011, that had grown to 55,400 households and a population of 151,900.

meaning, between 2001 and 2011, whilst the number of households in the Oxford City Council area grew by 7.16%, the population grew by 13.19%

Nothing surprising there then you might think, but my analysis of the 2011 Census results, using the most recent in-depth data on household formation (eg ‘one person households’, ‘couples/ family households’ or ‘couples + other adults households and multi -adult households’), has displayed a sudden and unexpected break with the trends of the whole of the 20^th Century. There has actually been a dramatic change in household formation in Oxford between 2001 and 2011.

Between 2001 and 2011, the population of Oxford grew, as did the number of Oxford properties (because of new home building). However, the growth rate of new properties built in Oxford was much lower than expected, but despite that the population has still grown by what was forecast rather than its growth being constrained by a lack of house building.  This must surely mean that the average household size was larger than anticipated in Oxford. In fact, average household size (ie the number of people in each property) in 2011 was almost exactly the same as in 2001, the first time for at least 100 years it had not fallen between censuses. (Since 1911, household size has decreased by around 20% every decade).

Looking at figures specifically for Oxford:

·       One person households - 32.7%

·       Couples/family households – 51.5%

·       Couple + other adults/multi-adult households – 15.8%

The decline was reflected in large scale shifts in the mix of household types. In particular, there were far more “couple + other adults households and multi -adult households” than expected (15.8% is c8,750 households). This can be put down to two things: Firstly, increased international migration; and, secondly, changes to household formation. A particularly important reason for the difference can most probably be attributed to the evidence that migrants initially form fewer households (ie two couples share one property) than those who have lived in the UK all their lives. Also, changes to household formation patterns amongst the rest of the population, including adult children living longer with their parents and more young adults living in shared accommodation (as can be seen in the growth of HMO properties (Homes in Multiple Occupation).  Traditionally in Oxford the term HMO was synonymous with student accommodation, however, as property become less affordable, young professionals are increasingly occupying shared accommodation enabling them to move for better jobs or simply to leave the family home earlier than would otherwise be the case.

So, what does all this mean for Oxford Homeowners and Landlords? Quite a lot in fact. There has been a subtle shift to larger households in the last decade, meaning smart landlords might be tempted to buy slightly larger properties, applying for an HMO licence from the Council in order to let their property to multiple professional tenants.  It also means that home owners selling their properties may be advised to market their property more widely via an agent with strong relationships with professional landlords as well as people looking to be owner occupiers.