People looking to rent can expect to face fierce competition for privately rented property, as the number of landlords selling up currently exceeds the volume purchasing investment units to let.
The latest of survey of private landlords across England and Wales, conducted by the National Residential Landlords Association (NRLA) in partnership with the research consultancy BVA/BDRC, found that 56% reported a rise in demand for privately rented homes in Q4 2021.
This was almost identical to the 57% who saw the same trend in the third quarter of last year.
Regionally, demand was highest in the South West, with 77% of landlords confirming that demand increased in Q3 2021.
Meanwhile, in a sign of post-Covid recovery in the London market, 74% of central London landlords saw increased demand. Some 54% of landlords in this region witnessed a similar trend in Q3 2021.
However, despite strong demand across the country, the proportion of landlords planning to reduce the number of properties they let – 24% outstrips the proportion currently planning to purchase homes to let 14%.
This research comes just days after the economic consultancy Capital Economics warned that, without urgent action, the supply of homes for private rent could fall by over half a million over the next ten years.
Capital Economics found that if owner occupation and social housing continue at their ten-year average rate of growth, private rented sector supply would have to increase by 227,000 per year to hit government targets.
It also noted that “even if the other [housing] tenures doubled their rate of growth, 105,000 homes for private rental would be needed each year, which is well above current rates of growth.”
Ben Beadle, chief executive of the NRLA, said: “The rental housing supply crisis is only set to worsen, as renters continue to feel the effects of a market starved of a healthy supply of homes for private rent.
“The government needs to accept that for all the rhetoric about homeownership, many people need to rent beforehand. Policies that dampen investment in the private rented sector serve only to reduce choice, drive up rents and, as a result, make homeownership more difficult to achieve.”
Well done Government & well done shelter you are achieving what you set out to do. Landlord bashing into submission. Those you claim to help and assist are the very ones you are harming and the ones who are suffering.
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So “the number of landlords selling up currently exceeds the volume purchasing investment units to let”. This should come as a surprise to nobody. People on these pages, including myself, have been warning about the effects of increasing regulation on the PRS. With eviction bans, the proposed scrapping of section 21, the increasing number of licensing schemes, the cost implications of meeting EPC ratings that owner occupied houses do not have to meet, the possibility that you will have to pay tenants removal expenses if you are actually allowed to sell etc. It is becoming less and less attractive to be a landlord in the PRS.
It’s a sellers’ market right now with demand outstripping supply, so now is a good time to sell up. I have a rental property, paid for, empty, just renovated. It will be sold. Even after CGT I can clear about 22 years gross rent. Once sold there will be no hassle with repairs, storm damage, tenant damage, rent arrears that can never be recovered and costly draconian regulations to comply with. As other tenants naturally move out, I would plan to redecorate and sell. Maybe I might have to go down the eviction route at some point, I don’t want to, but circumstances may eventually force me to.
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