Does immigration really impact the UK housing market?

For some time there has been talk about how immigration will impact the UK housing market amid concerns about the post Brexit environment. While it is difficult to put together a comprehensive up to date list of household residents aged 16 and above, together with their country of birth, if we look back to the 2011 consensus this gives us the information we are looking for. Obviously, the situation could have changed dramatically since 2011 but there are a number of points to take into consideration.

England and Wales

The number of people aged 16 and above living in England and Wales was 44.5 million back in 2011. We know from the consensus that 85% of household residents aged 16 and above were born in the UK, 5% were born in EU countries and 10% in non-EU countries. It is highly likely the number of household residents born in EU countries has increased since 2011, but this does give us an idea of what the situation was only six years ago.

At that time the number of people living in owned or shared ownership was 89%, 3% and 8% respectively. Those in social housing came in at 84%, 4% and 12% and private rental (or living rent free) was 68%, 13% and 19% respectively. So, despite concerns that those moving to the UK from the European Union in particular were “milking the UK benefit system” that does not appear to be the situation. While 5% of total household residents at the time were from the European Union we know that 13% were living in private rented properties.

North-South divide

If we take the north-east of England as a benchmark for the “north” the 2011 consensus shows that those household residents aged 16 and above were just over 2 million with 94% born in the UK, 2% in the European Union countries and 4% in non-EU countries. When you compare this with the south-east of England the breakdown is 86%, 5% and 9% respectively which is a significant difference. However, when you look at the London market this is a whole different world!

The London figures from the 2011 consensus showed that household residents aged 16 and above came in at just under 6.5 million people. The breakdown of household residents born in the UK was 57%, with 12% from EU countries and 31% non-EU countries. So, while the number of people living in the UK but born in the European Union was significantly higher than the England and Wales average, the greatest difference was in those born in non-EU countries. The situation in Wales was 94%, 2% and 4% respectively which is significantly lower than the England and Wales average but the difference is not as marked as London for example.

We await the next consensus

We know that London in particular is a multicultural city the likes of which are very uncommon across the world. Some people will be surprised at the split between those born in the UK, EU countries and non-EU countries. Those that continue to target the European Union as the cause of a spiralling housing benefit budget in the UK may well be barking up the wrong tree. The next consensus will include another decade of EU free movement and it will be interesting to see how this has impacted the UK housing market.

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