HOUSING AND DEMOGRAPHICS Aligning housing strategy with demographic reality: A data-driven approach for local authorities

Chris Plumley

Chris is Public Sector Real estate Partner at Trowers & Hamlins and the Towns Fund lead. He specialises in large-scale public sector regeneration and mixed use development projects. With over 20 years’ experience, he is particularly noted for unlocking stalled developments. He works alongside commercial, surveying, financial and property teams to plan and prepare the structures and governance for large scale projects.  Chris has many years of experience working collaboratively with developers, senior officers, in-house professional advisers within the public, private and emergency sectors. With many large scale and politically sensitive projects to his name, Chris has established a national reputation within the regeneration market. He has helped clients on major property development projects, to devise commercial and risk mitigated structures and ongoing project management.

Chris discusses the firm’s "Ages & Stages" research, highlighting the fascinating links between housing needs and demographic reality. “For local authority directors of place, the demographic data presents a clear mandate: move beyond one-size-fits-all housing delivery towards targeted provision that responds to specific life stages, economic drivers, and regional characteristics.” 

Introduction 

To meet the ambitious goal of delivering 1.5 million homes by the end of the current Parliament, the UK must not only drive economic growth, but also address specific housing needs in response to changing demographics across the UK. For local authority place shapers, this challenge represents both an operational imperative and a strategic opportunity. Economic growth drives the delivery of new homes, but it is also dependent on having the homes that the people who create that growth need. 

One key determinant of demand is the age profile of the UK population. The country is ageing, and our life milestones are shifting later. This fundamental demographic shift requires local authorities to recalibrate their housing strategies, moving beyond simple numerical targets, to embrace a more nuanced understanding of who needs housing, where they need it, and what type of accommodation will serve them best. 

The demographic imperative 

Different occupier groups have varying priorities which influence home demand across the UK. We are a growing - but also an ageing - population and this will be expressed over time in different strands of demand for homes. There is a developing variance in the age profiles of locations across the UK, and this will become increasingly pronounced as the population grows, but has a bigger segment which is moving into upper age bands. 

The data gathered as part of our research reveals striking variations across major UK cities. Greater London shows 18.0% of its population in the 25-34 age bracket, while Manchester has 16.4%, indicating strong concentrations of young professionals in these urban centres. Conversely, Glasgow shows 14.3% of its population aged 45-54, while Edinburgh has 13.5% in the same bracket, suggesting different housing priorities for these cities. 

The number of people in the UK with an unsatisfied housing need stands at 8.5m, a figure that should galvanise local authorities into action. However, meeting this need requires more than simply building homes—it demands strategic alignment between housing supply and demographic demand patterns. 

Understanding life stages and housing transitions 

Understanding a range of life milestones, such as achieving economic independence (25-26 years), first home purchase (33.8 years), and mortgage payoff (60 years), is critical in understanding the timing and nature of housing demand. These milestones paint a picture of extended transitions that have profound implications for housing policy. 

People start working at 17 and become economically independent in their mid-twenties, but it takes another decade to afford buying a home. This decade-long gap between economic independence and homeownership represents a critical period during which rental accommodation must serve a diverse population. The average age of first-time buyers is now 33.8 years. Many will be parents with growing families and not necessarily the young individual or couple we might think of. 

This reality challenges traditional assumptions about first-time buyer accommodation. Local authorities must recognise that first-time buyers increasingly require family-sized homes rather than starter flats, fundamentally altering the type of housing stock needed to support homeownership transitions. 

The Build-to-Rent opportunity 

There are two critical areas of housing delivery that will be influenced by these factors - Build to Rent (BTR) sector, predominantly serving those between the ages of 25-34, and the provision of senior living housing. The BTR sector has shown remarkable growth, with the completion of over 22,300 new BTR homes in 2024 alone, marking a record year for the sector. The operational BTR stock, which includes co-living, multifamily, and single-family housing, now exceeds 126,000 homes, with substantial growth projected in the coming years. 

For local authorities, BTR represents a mechanism to address housing need while attracting private investment. Build-to-rent developers will benefit from a reopened Private Rented Sector Guarantee Scheme, with nearly £2bn available to boost delivery, creating opportunities for partnership between public and private sectors. 

The BTR sector in the UK has traditionally focused on city centres, catering primarily to the 25-34 age group. However, there is a growing demand for single-family housing among the 35-45 age group, which tends to be located outside urban centres. This demographic shift presents a significant market opportunity for expanding BTR developments to suburban areas, addressing the needs of single families seeking rental options. 

This evolution in BTR provision aligns well with local authority land holdings, particularly in suburban locations where family-sized rental accommodation could serve the growing cohort of households unable to access homeownership, but requiring more space than city-centre apartments provide. 

The senior living challenge 

The UK's ageing population presents an urgent need for senior living housing. With people aged 65 and over constituting around 18% of the population, and the number of those aged 80 and over set to more than double, there is a clear demand for more housing solutions that cater for older adults. With almost one in five people aged 65 and over, and nearly two in five aged 50 and over, the need for senior living housing options is becoming more urgent. 

The provision of senior living housing doesn't currently provide enough options for a stage of life that could be up to 50 years long. This represents a significant market concern that local authorities are uniquely positioned to address. Modern senior living schemes must evolve to accommodate the active lifestyles of the over-55s, ensuring that housing options are both diverse and flexible. 

The data on life stages reveals the complexity of this challenge. The average age of entry into retirement living is 79, while the average age of the population in care homes is 86.6 years, indicating distinct phases of senior living that require different housing solutions. 

Under-occupation and asset utilisation 

70% of people stay in their family home after children move out, leading to under-occupation and cost of living challenges. This statistic has profound implications for local authority housing strategy. Under-occupation represents both a social challenge—older residents struggling with maintenance and heating costs in oversized properties—and a strategic opportunity to free up family-sized housing stock. 

Those still living in family homes after their children have moved out are key demographics to consider. This highlights the need for thoughtful planning around senior living options and the potential to free up family homes. Local authorities should consider how attractive senior living options could encourage downsizing, simultaneously improving quality of life for older residents, while releasing family homes to the market. 

Regional variations and economic drivers 

In the past 25 years, a third of the UK's highest productivity industries were responsible for generating nearly two-thirds of the economy's entire productivity growth. In its 10-year industrial strategy, Invest 2035, the UK Government has identified a mix of eight 'old and new' business sectors which it believes offer the highest growth opportunity for the economy, including advanced manufacturing, clean energy industries, creative industries, defence, digital and technologies, financial services, life sciences, and professional and business services. 

If the providers of homes are targeting occupiers or owners from particular localised business sectors, it is powerful to track the trajectory of those sectors and also the prevailing economic temperature of their location. Local authorities must understand which of these growth sectors are present in their areas and plan housing accordingly. 

Regional analysis reveals distinct patterns. Affordable property prices and strong job market growth, particularly in Manchester and Leeds, are driving demand in the North of England. Bristol is the South West's most progressive market, where house prices have risen by almost 90% in the past decade, and which is now also attracting a substantial amount of BTR development. London and South East experiences high demand but significant affordability challenges. There is a shift towards commuter towns, as people seek more affordable housing options. 

Strategic implications for local authorities 

With 80% of 2050s buildings already built, new homes must support economic and social wellbeing while achieving Net Zero goals. This reality emphasises that local authorities must adopt a dual approach: optimising existing stock while strategically developing new housing that meets emerging demographic needs. 

Increasingly, children live longer at home or parents join younger generations, forming multigenerational homes. This trend, combined with trends in marriage, co-habitation, divorce, and single-parent households, creates demand for flexible housing that can adapt to changing household compositions. 

Homes do not exist in isolation; sustainable communities are built upon infrastructure including transport, energy, schools, hospitals, retail, leisure and of course employment opportunities their inhabitants need. Local authority estates surveyors must therefore adopt a holistic approach, ensuring that housing development is integrated with infrastructure planning. 

Conclusion 

Connecting people with opportunity and the diversity of people's preferences and needs should guide the types of homes we build. For local authority directors of place, the demographic data presents a clear mandate: move beyond one-size-fits-all housing delivery towards targeted provision that responds to specific life stages, economic drivers, and regional characteristics. 

The challenge is substantial, but so is the opportunity. By aligning housing strategy with demographic reality, local authorities can deliver homes that not only meet numerical targets but genuinely serve the needs of their communities, supporting economic growth while enhancing social wellbeing. The data is clear—now is the time for strategic action.