The Demographics of Building Homes: Who’s Likely to Move In?

As residential building becomes increasingly competitive, developers need to take a more strategic approach to how, what and where they choose to build – and who they build for.

We’ve previously looked at how data from our Ocean database, combined with the Institution for Social and Economic Research’s Understanding Society study, helped us to identify ‘likely movers’ – those with the highest propensity to move within a year – and where they currently live in the UK.

This data doesn’t just offer information about the location of potential movers – we’ve also been able to dig deeper into the demographics that make up the 8.6 million people most likely to move in the next 12 months.

Segmenting The Likely Movers

For developers, understanding the potential customer is key to shaping the offering they build. We used Acorn, our demographic classification tool, to build more detailed profiles of the different target markets.

Acorn segments the UK’s households, neighbourhoods and postcodes into six broad categories and 18 specific types, defined by basic characteristics such as age and income, and more in-depth factors, like lifestyle. By sorting our information about likely movers into Acorn groups, we’ve identified the top five groups that have the highest potential to move in the next year:

1. Student Life
2. City Sophisticates
3. Young Hardship
4. Career Climbers
5. Starting out

The ‘Student Life’ group, which is part of the ‘Financially Stretched’ Acorn category, are five times more likely to move than the UK average. This is largely to do with their life stage, as they often live in shared, purpose-built student housing or short-term private rental arrangements while studying. Many will move multiple times during their student years – and will often move into their first non-family home when they graduate, which is an obvious opportunity for developers.

Using these Acorn classifications, house builders can answer a vital question: “who do we want to buy our properties?” By identifying their ideal market – whether that’s students, people moving into cities for work, young families just getting started, or elderly people moving into retirement homes – residential developers tailor both their builds and their marketing campaigns to deliver a faster return on investment.

Finding Tomorrow’s Customers

However, simply knowing who you want to target won’t be enough. Developers also need to consider when they will be targeting their chosen group.

No person stays in one Acorn group throughout their entire life. And that means their needs and interests will change as they move from one category to another. Say the development will be a purpose-built private rental scheme aimed at Career Climbers – if the build takes 18 months, by the time it’s completed many of the Career Climber group will have progressed into another category, such as City Sophisticate.

That means developers need to anticipate their future market – the renters of tomorrow, who will be building their careers and becoming potential customers. Using Acorn data, we can help developers plot ‘lifecycles’ for their target markets, helping them identify which sections of the population are likely to be in their target market when a development is finished.

This gives new developments a key advantage: rather than finishing a build, then advertising to the target market, developers can reach their potential customers before they’re even ready to move.

Understanding Potential Buyers

Finding your audience ahead of time is undoubtedly the key to unlocking the fastest possible return on investment from your next development. Our unique population data and analysis also lets us dig into where likely movers live now, how their income affects how much they can afford to spend, and the amenities they look for in their next home.

If you want to hear more about how CACI’s Property expertise can help you, get in contact now.