You are here: Home - Mortgages - Buy To Let - News -

No let-up in demand for rented homes

0
Written by:
02/02/2016
Demand for rented homes will soar over the next five years despite government measures to help ‘generation rent’ become ‘generation buy’, figures suggest.

Analysts at estate agent Savills forecast the Private Rented Sector will grow by 1.1 million households by 2021, even if the government target of building 400,000 new affordable homes for sale over this parliament is achieved.

The Savills data suggests the economic recovery and ongoing low interest rate environment have done little to reverse the growing need for rented housing.

Instead, house price inflation higher than wage growth has served to push homeownership further out of reach for many people.

According to the English Housing Survey, private renting grew by a staggering 17,500 households per month on average over the 10 years to 2014.

Government housing policy, including Starter Homes, a greater number of Shared Ownership homes and access to larger equity loans through Help to Buy London, seeks to reverse this trend by helping people access the property ladder.

Susan Emmett, director, Savills residential research, said: “Demand for rented homes could still rise more sharply than we have forecast. We would question whether policies can accelerate housebuilding enough to see the government’s target of 400,000 affordable homes for sale reached in the timescale set.

“And given the overlap between the different schemes, each focused at similar parts of the market, it is possible that one scheme could simply replace the other rather than providing additional homes.

“This analysis demonstrates that we still need to provide a substantial number of homes for rent. Government policy should focus on supporting the development of new homes to rent as well as to buy.”

As the need for rented homes grows, Savills said recent policy announcements are set to constrain the supply of rental homes.

The introduction of a Stamp Duty surcharge of 3% on buy-to-let properties and the restriction on tax relief on mortgage interest payments are likely to limit the ability of private investors to expand their portfolios, the estate agent said.

 

 

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

If one of your jobs this month is to get your finances in order, moving your savings to a higher paying deal i...

Coronavirus and your finances: what help can you get?

News and updates on everything to do with coronavirus and your personal finances.

Everything you need to know about being furloughed

If you’ve been ‘furloughed’ by your company, here’s what it means…

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

Read previous post:
junior isa
How you could give your child £100k on their 18th birthday

Imagine the look on your child’s face if you presented them with a gift of £100,000 on their 18th birthday?

Close