Nearly one in 10 rented homes in the UK could be a bungalow in the next 10 years, research conducted on behalf of Paragon bank has revealed.

A survey of over 1,300 tenants in the private rented sector (PRS) showed that currently 3% of people live in a bungalow, but 9% of respondents expect to rent this type of property in 10 to 15 years’ time.

The increase correlates with a forecast increase in older tenants living in rented homes over the same period.

Homes headed by a person over the age of 55 will account for over a quarter of all privately renting households by 2035, analysis conducted on behalf of Paragon Bank by the Social Market Foundation found.

It’s report, ‘Where next for the private rented sector?’, found that 18% of households currently private renting are headed by somebody aged 55 or over. This will rise to 27% of households by 2035 according to the SMF’s projections.

Richard Rowntree, Paragon Bank Managing Director of Mortgages, said: “The evidence suggests that the demographics of private renters is shifting and that the profile of tenants is getting older. There is a growing proportion of people who will rent property for their entire lives, whilst we have also seen growth in the number of people who have sold property and have gone into rented homes.

“The challenge for landlords is providing the right homes for older tenants. Bungalows are typically regarded as unfashionable, but they offer practical benefits for people who may not be as mobile as they once were and certainly have their place in the PRS. We would expect to see an increase in this type of property, as well as homes specifically targeting older tenants, over the next 10 to 15 years. Landlords are not yet buying this type of property in scale, but we would expect that to accelerate to match forecast levels of tenant demand for bungalows in future.”

The Government’s English Housing Survey shows there are currently 141,000 bungalows in the PRS in England, representing 3.3% of the total number of rented homes. Buy-to-let lending figures show strong growth in the number of bungalows purchased by landlords over the past five years, although they still remain low as a proportion of total properties acquired.  

Last year, landlords purchased 3,370 bungalows with a buy-to-let mortgage, compared to 1,844 in 2017.

Another significant shift in property type was semi-detached homes. Currently 20% of tenants said they rent this type of property, with 25% forecasting they will rent semi-detached homes in the future.

Conversely, terraced homes and flats are forecast to experience falls. Just under a third (30%) of tenants today live in a terraced home, with 20% saying they expect to rent this type of property in the future. Flats, meanwhile, are currently home to 40% of tenants, with 30% of people saying they expect to be renting this type of home in 10 years. 

For further information contact:

Michael Clarke
Paragon Bank
07740090746

www.paragonbank.co.uk 

Notes to editors:

• The report, Where next for the private rented sector?, was published at 08:30 AM on 14 March 2022 at smf.co.uk/publications/future-of-private-rented-sector/
• SMF surveyed over 1,300 UK adults who currently live in rented accommodation. Surveys were distributed by Opinium
• This report was sponsored by Paragon Bank. The SMF retained complete editorial independence

Paragon lends to private individuals and limited companies and has mortgages suitable for single, self-contained properties, as well as HMOs and multi-unit blocks. Paragon can accommodate higher aggregate lending limits and more complex letting arrangements including local authority leases and corporate leases along with standard ASTs.

Paragon introduced its first product aimed at the professional property investor in 1995 and is a member of UK Finance, the Intermediary Mortgage Lenders Association (IMLA), National Landlords Association (NLA) and the Association of Residential Letting Agents (ARLA). 

Paragon Bank PLC a subsidiary of the Paragon Banking Group PLC which is a FTSE 250 company based in Solihull in the West Midlands. Established in 1985, Paragon Banking Group PLC has over £12 billion of assets under management and manages over 450,000 customer accounts.

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ.