Immigration, households and housing demand – some thoughts!

Using the data in the ONS report which we outlined yesterday we can see that:

Between 2011 and 2015 the number of households headed by:
someone from the EU rose by 222,000
someone from outside the EU rose by 100,000
someone born in the UK rose by 100,000

This gives a total of 422,000 extra households with a potential demand for 422,000 houses (105,500 per annum), of which only 23% could be regarded as derived from UK household growth.

The average household size tends to be larger for households where the household reference person is from either the EU or non-EU countries (2.6 and 3.0 respectively, compared to 2.3 for households where the household reference person is UK born. This may be because these households consist of a number of people banding together to rent or own a property.

Because of this, demand for houses is lower than might be expected from the population numbers themselves.

However, if as other evidence suggests households consisting of immigrants change over time such that household size converges with the UK average this would increase the demand for housing.

Immigration into the UK does as we might suspect impact on housing demand although in a slightly different way from what we might imagine.


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