A leading letting agent argues that the UK housing market is not prepared to deal with a growing number of lifetime renters.
DJ Alexander, an independent agency which manages over 5,000 properties, says that this failure is down to a combination of three reasons.
It says a falling rate of new-build properties, a static rental sector caused by increased regulation and slowing social housing supply means that long-term renters could find their options limited by a lack of housing stock.
The Edinburgh-based agency cites figures showing that fewer buy-to-let mortgages were taken out in June when compared to 2017, suggesting many landlords are not expanding their portfolios or considering leaving the sector altogether.
“The market has become much tougher in recent years with changes to affordability, access to finance, and a reduction in the tax benefits of property investment,” says David Alexander, managing director of DJ Alexander.
“The result is potentially a fall in the number of private rental properties available although this will be different across the UK with some rental markets stronger than others.”
“Therefore, many life-long renters, of whom there are a growing number in their thirties and forties, may find their choice limited by a smaller marketplace.”
The agency then goes on to cite figures from the English Housing Survey which show that more middle-aged people are entering the private rented sector and that the number of owner occupiers is falling.
“With a growing number of life-long renters emerging there is going to be an increasing need for more social housing, more private renting, and more affordable homes across the country,” says Alexander.
“The government and local authorities need to work together with the private sector to ensure that we have a sufficient housing stock to serve the changing needs of the UK population.”
“This means freeing up more land in areas where demand is high for property development, a steady and continuing programme of social housebuilding, the encouragement of the private sector to build more homes in areas of greatest need, and the encouragement of a strong and vibrant private rented sector,” he says.
Alexander says that changing property market conditions could see an exodus of accidental landlords – those who entered the property market by chance, inheritance or were unable to sell their home.
He suggests there’ll be ‘a new breed of entrepreneurial, organised, and well-funded landlords emerging’ over the next few years.
