With the forthcoming General Election and the possibility of Jeremy Corbyn becoming Prime Minister a genuine consideration, landlords and those in the property industry should expect further scrutiny – whether it be rent controls, landlord tax relief, right-to-buy or tenant fees, never has the industry and those investing in it faced such criticism – but is it fair?
Investor landlords have been held responsible for preventing our younger generations from being able to buy. At the time of the last census in 2011, there were 3,401,675 rented properties in England. Ten years previously this had stood at only 1,798,864.
Despite some of the wealth accrued by private landlords, there have been many positives of the growth of the Private Rented Sector. Tenants have benefited from competition in the market place, increased choice and flexibility of living. The quality of private rented accommodation continues to rise and further regulation aimed at calling irresponsible landlords to account is welcomed by all. Landlords are not quite on a par with the traffic wardens who last year raised around £2.8 million for Plymouth City Council!
Property values today in Plymouth are still only 5.1% above 2007 levels. RPI inflation has however risen by 29.7% in the same time frame, so in real terms, properties today are 24.6% less expensive than previously. Interest rates are at an all time low and first time buyers need only save £5,000 for a lovely 2-bed apartment in the Barbican. In most instances buying is far less expensive than renting…. So why aren’t people choosing to do this?
The trend to rent, either for lifestyle or economic reasons looks set to continue. The number of rental properties in Plymouth is likely to have risen from approximately 22,962 properties recorded in 2010 to just shy of 29,000 by 2021. Sound fanciful? Well in 2000, there were only 12,900 privately rented properties in the city. It is a fact that as a country we are in the midst of a transition in homeownership to a European model – but this need not be viewed as a negative as many politicians like to portray.
With the recent announcement by the Office for National Statistics (ONS) that inflation moved to zero in August, it seems likely that interest rates will remain unaltered until the middle of next year. This can only be good news for property investors and those who actually want and are willing to save to get on the housing ladder.