London, UK, 23, March 2015 – New research from Experian, the global information services group, has revealed that an increasing number of people cannot afford to buy a home in the area in which they live. As a result, many younger professional families, who have been priced out of the property market where they live, are looking to set up home in more rural locations with good transport links – dubbed, “The Ruburbs”.
This shift in the population will mean profound changes to the consumer landscape in these communities. Brands will need to acknowledge this shift and ensure that they are in a position to meet demand. Transport links in these areas are also set to come under increasing strain and planners need to take steps to make sure they are in a position to cope.
According to the Experian ‘Affordability Index’, in London some 54% of residents now cannot afford to buy a property where they live. Nationally, that proportion falls a little, however 37% of all the people in the UK are now unable to buy in the area where they live.
Rising house prices are clearly a factor. The latest figures from Experian’s Property Index show that, between April and June 2014, the number of homes that entered the market for sale valued at over £500k rose by almost a third (30%), while houses for sale in the second highest price band (£250k to £500k) rose by 16% over the last 12 months. For both price bands, this is the highest level since 2010.
This all adds up to a scenario where many people are choosing to move further away from city centres, including London. Younger people who choose to stay in the town centres are more than likely to be renting. The average deposit for first time buyers in London is around £80,000,giving us an idea of the challenge people now face trying to purchase property in the capital.
Richard Jenkings, Senior Consultant at Experian Marketing Services UK&I said:
“The property market is prompting widespread change in the UK, with the ‘spreading of the suburbs’ seeing more and more professional families relocating further away from our cities.
“The move to the country is, for many, a lifestyle choice. Some householders are living a kind of suburban existence with all the lifestyle trappings of the countryside.There are clear opportunities for businesses to steal a march on their competitors by engaging the new settlers with tailored offers and messages, providing goods and services which fit changing consumer demands.
“Better connectivity and technology is allowing many more people to work effectively by remote these days, but the need for high-speed internet access outside our city centres has never been higher.
“However, not everyone can work from home, and factors like rising train fares and petrol prices then become a bigger issue for these groups. The trade-off from a consumer perspective is that they can afford a bigger home for their money in a more rural location, but they face higher commuter costs and longer journeys.
“Transport systems are coming under increasing pressure in certain parts of the country and various groups, including town planners and rail operators, will need to factor in the ‘rise of the Ruburbs’ into any future planning.”
From Suburbs to Ruburbs
From the 1920s and 1930s onwards we saw a growth outwards of newer, larger housing with gardens creating the suburbs as we know them. The suburbs are better-off middle class areas focused on the family, the car and the separation of work and living.
In more recent times this outward expansion has continued where people move out beyond the built-up area of their town into the surrounding smaller more rural places.
This is the development of the Rural-suburbs, which are not quite suburbs and not quite rural, but a mixture of both. In short, Britain now has a vast stretch of “Rurban” areas where seemingly rural locations are populated by suburbanites.
This trend is already having an impact on these areas. As the population evolves, organisations in both the public and private sector will need to acknowledge this change and take steps accordingly to address it.
Head of PR, Marketing Services, UK and EMEA
M: 44 (0) 7583 297082
We are the leading global information services company, providing data and analytical tools to our clients around the world. We help businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. We also help people to check their credit report and credit score, and protect against identity theft. In 2014, we were named by Forbes magazine as one of the ‘World’s Most Innovative Companies’.
We employ approximately 16,000 people in 39 countries and our corporate headquarters are in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended March 31, 2014, was US$4.8 billion.