Making homes affordable for first-time buyers is a problem that does not have one easy solution.
With house prices having risen rapidly since the start of the pandemic, many are finding themselves priced out – especially in inner cities.
But major housebuilder Barratt Homes thinks it has found a way for young people to climb on to the housing ladder without breaking the bank.
The living area in Barratt’s ‘SMRT’ home. The apartment comes in at just 37 square metres
At its Eastman Village development in Harrow, North London, it has built a tiny home measuring just 37 square metres or 400 sq ft.
It may have the smallest floor plan that can be built under the Government’s minimum space standards, but Barratt describes the flat as ‘a forward-thinking luxury product that is perfectly proportioned’.
Although the apartments might charitably be described as ‘cosy,’ the price is right, with homes starting at £290,000. This is £40,000 cheaper than the standard Barratt home in London.
It says the tiny homes are designed to ‘help ease the squeeze experienced by London’s “generation rent”, who face ever-rising property prices and rental costs’.
According to Halifax’s latest house price index, the average house price in London is currently £508,000; a figure which has increased by around £25,000 since the start of the pandemic.
Barratt is calling the new design a ‘SMRT’ home, and launched off-plan sales at the development in Harrow at the weekend.
If it is successful, it could roll out the pocket-sized apartments across the country – and prices outside of London would likely be even lower.
This is Money went on a tour of the show apartment, and spoke to Barratt’s senior sales manager Joseph Antoniazzi about whether this is really what first-time buyers want.
The flats have been designed by Barratt’s in-house design team, BD Living, and Blocc Interiors.
They have aimed to make the most of what little space is available, for example by adding a built-in storage unit with shelves and cupboards around the bed, and a kitchen storage cupboard that houses the washer dryer but also has room for other bulky items such as a hoover or ironing board.
According to Barratt, small is beautiful. Its marketing material for the apartments says:
‘While the square footage may be smaller on paper, the illusion of space created by wide balconies, floor-to-ceiling windows, and clever interior layouts, means the apartments feel open, optimised, and modern.
‘Storage in every nook and cranny means there is no need for clunky furniture like wardrobes, sideboards, and drawers.’
The bedroom in the SMRT home has storage for clothes built all the way around it
The kitchen cupboards have pull-out shelves to store canned food and spices, and the worktops are slimmer than average to maximise the floor space, as is the dishwasher.
‘We have maximised every inch and made sure the space is really functional,’ said Antoniazzi.
There is space for a small dining table in between the kitchen area and living room. Antoniazzi says they initially installed a table that folded out from the wall, but that potential buyers did not respond well to it so it was changed.
For those working from home, there is the option to have an ‘office niche’ which consists of a desk and storage in the living room, side-by-side with the television.
The ‘office niche’ in the living area provides a small space in which to work from home
Although this may work for a single person, it could present a challenge for a couple that were both working at home.
There is also the option to have a small dressing table in the bedroom, though this would need to sit behind the door.
In the bathroom, there is a well-sized shower cubicle, which Antoniazzi said buyers preferred to a bath.
The outdoor terrace is small, with room for two chairs and a small table, but it backs on to a larger shared garden which gives the illusion of space.
The apartment comes with a small terrace which backs on to a larger shared garden
For flats on upper floors, there would instead be a balcony.
Antoniazzi said the homes were designed for first-time buyers, key workers and students, and acknowledged that they would not be suitable for a family.
‘It is very much first-time buyer driven,’ he said, adding that lifestyle changes during the pandemic had seen families move out of locations like Harrow to the countryside, and be replaced by renters from central London – as people from across the spectrum sought to move up a level in terms of space.
‘Post-lockdown, we saw a change in the type of buyer that was coming to view our apartments in Harrow.
‘Whereas previously it was couples and young families, we saw the profile change towards people who had previously been renting in central London and didn’t want to waste money on rent any more.’
The storage cupboard in the kitchen provides some space for household essentials
He said the idea for the micro-apartments came from the fact that many of these potential buyers had saved up during the pandemic and were keen to get on the housing ladder, but needed something more affordable than the market average.
Antoniazzi also said the small homes could become a more popular way of getting on the housing ladder when the Government’s Help to Buy scheme ends in 2023.
Barratt has said that, if buyers respond well to these micro-apartments, they could build more in cities across the country.
The apartments could work well for single occupiers, who often struggle to get a large enough mortgage because of salary requirements.
Living there as a couple could be a squeeze – but the success of the SMRT homes will reveal whether first-time buyers think that is a price worth paying to get on the ladder.