If a high proportion of the population is under 18, they’ll still be living with their parents and not yet ready to buy or rent a house. But in ten, fifteen or twenty years’ time, many of these youths will be looking for somewhere of their own to live. This will create a ‘bump’ in demand that will push up housing prices if sufficient property hasn’t been built to meet their demand.
For example, the so called Generation Y, who are those born between the late 1970s and early 2000s, were once happy to rent in inner city suburbs are now looking to buy there instead, causing a switch in demand from rental properties to owner occupier.
And while these demographic changes have an overall impact on the number of properties required, they also have a major impact on the type of property needed. For instance, Generation Y’s first property will most likely be near the centre of town, close to work and social life and where there is transport is available, but it must be something they can afford. This means a high demand for small affordable units and apartments or perhaps even large houses that they can share with others.
But, as most of them won’t want to commit to buying property just yet and will prefer to rent, city centre rental prices will go up.
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