By New research has shown that when it comes to housebuilder preferences, one bed properties have been largely left out in the cold in recent years, as the only area of the market to see a consistent decline in homes completed.
The analysis of housebuilding data by Unlatch shows that in the last year, one bedroom properties have accounted for just 6% of all homes built.
This falls to just 1% when analysing houses alone, but even where flats are concerned, one bed homes account for just 5% of total stock delivered to the market.
The neglect of one bedroom homes is even more apparent when looking at how housing delivery levels have changed over time.
In the last year, the total number of properties completed has increased by 10% and sits 16% higher than it did five years ago.
When analysing this change by the number of bedrooms in each property, all segments of the market have recorded both positive annual and five year growth, other than one bedroom homes.
In the last five years, the level of one bedroom homes being built has fallen by -13%, down -17% in the last year alone.
This can, of course, be largely attributed to the fact that the majority of one bed homes largely come via the construction of flats and, in the last five years, this property type has also seen a -12% decline in overall completions.
Again, one bedroom flats have seen the largest five year decline, followed by two bedroom flats, but the number of three bedroom flats has actually increased by 16%.
At the same time, houses, regardless of how many bedrooms they have, have shown positive movement when it comes to both the annual and five year change in completions.
Lee Martin, Head of UK for Unlatch says:
“It only felt like yesterday when the demand for one bedroom properties was driving the market, especially within the first time buyer market.
However, this consistent decline falls in line with the then rise of the Government’s Help to Buy scheme, where buyers were able to borrow interest free for 5 years 20-40% towards their deposit, meaning they could move up the ladder in an accelerated timeline.
Buyers were then able to afford that second bedroom, or even small house rather than an apartment.
They would then move in with a friend or sibling, making the monthly mortgage payments even more affordable than the non-Help to Buy route.
Of course, now with Help to Buy due to run its current course by 2023, could we see a return of buyer appetites for one bedroom properties?
Or will there be an extension or a new product to fill the gap for that first time buyer demographic?
Shared ownership has also played its part in the demise of one bedroom homes.
It no longer has the stigma attached that it once did, with young professionals using this tool to achieve larger homes for a much more affordable deposit when compared to a traditional purchase, yet still offering the opportunity to buy more stake in the property as time goes by.
On top of this greater diversity when it comes to routes to purchasing, there’s also the simple fact that today’s buyer aspires to have a larger home with more space, even more so since Covid.
This means larger homes with more ‘trimmings’, such as parking, outside space and a second bedroom for use of an office space.
These boxes are rarely ticked via one bedroom homes.”
Comments