The UK is a nation of city dwellers with 82 per cent of the population now living in urban areas according to new research by storage company FEDESSA and property consultant JLL.

The growing pressure on housing supply in cities has squeezed urbanites into ever smaller yet more expensive homes, the report found.

This is particularly true in London, where the population hit an all-time high of 8.6 million this year and is projected to reach 10 million by 2030.

Meanwhile housing supply has not caught up with the increased demand from rural-to-urban migrants, causing homes to shrink and prices to rise: the average one-bedroom flat is now only 47sq m. The size of households has also increased as population growth has outpaced growth in the number of households, according to a report by the London Assembly.

Spiralling house prices in the capital have also led to a significant increase in private renting, from 17 per cent in 2001 to more than 25 per cent in 2015.

This combination of smaller, more crowded properties and more transitory lifestyles has increased demand for self storage says the report, while at the same time, rising property prices have made this a less attractive investment.

This means that alternative investments, including storage, have been identified as a growth market across Europe, but particularly in the UK.

Rennie Schafer, chief executive officer of FEDESSA said: “The FEDESSA annual survey shows that the industry in most European markets is once again showing solid signs of growth, in terms of expanding sites, new developments and new entrants to the industry.

“Meanwhile capital flows into European Commercial Real Estate (CRE) have seen a significant rise over the past few years. Direct real estate investment volumes hit €102 billion in the first half of 2015, up 21 per cent since 2014. The UK accounted for 40 per cent of all European transactions in 2015.

“The weight of money coming into CRE has led to many investors being priced out of certain sectors in core locations, and concurrently looking increasingly at ‘alternative’ sectors such as healthcare, student housing and self storage. The alternatives space now accounts for 17 per cent of all investment in Europe, up from 10 per cent in 2010. The UK being the most mature of ‘alternative’ markets.”