UK becoming a nation of rentersThe UK continues to become a nation of renters as demand for rental property grows. That trend is set to continue in 2014, according to estate agents, taking the country's housing market another step closer to its European neighbours.
Research from Belvoir Lettings shows that there has been rapid growth in residential lettings, with over 15 per cent of all UK homes (3.2m) now in the Private Rented Sector (PRS).
Indeed, some Government estimates predict a further rise of 33% in the residential rental market over the next eight years. If true, by 2012 one in five of all UK homes will be in the PRS.
The report follows figures that indicate landlords are increasingly confident in the UK buy-to-let market, planning to increase their portfolio in the next 12 months. At the same time, foreign landlords have also increased by 6 per cent in the last year.
“Over the past year the PRS has remained on a firm footing and despite Government ‘pump priming’ initiatives such as the ‘Help To Buy’ scheme there has been no real impact on the continued demand for rental property,” says Dorian Gonsalves, CEO of Belvoir Lettings.
“Belvoir predicts that in 2014, the number of people choosing to rent will continue to drive up demand. There are real indications of a recovery in the housing market with property prices predicted to rise, along with a projected 25 per cent increase in Buy to Let (BTL) mortgage lending. With this we expect to see the re-emergence of more and more investment minded landlords looking to capitalise on this trend.”
A considerable number of landlords entering the sector over the last five years have been ‘accidental landlords’. In 2014 some of these are expected to take advantage of rising prices in order to make modest gains and exit the market.
“We now anticipate that over the next few years, new rented housing stock will come from different directions, partially from institutional investors returning to the market to provide much needed funding,” he adds.