The English Housing Survey, which shows that the private rented sector remains the second largest tenure in England, has highlighted the need for a purpose-built private rental sector, according to the British Property Federation (BPF).
The latest survey shows that that young households aged 25 to 34 were more likely to be renting privately than buying their own home.
The BPF believes that an institutionally funded build-to-rent sector is the most effective way in which to significantly increase the volume and standard of private rented sector accommodation in the UK.
It has praised the government for its work in encouraging the build-to-rent sector over the past few years, but has warned that a future government will need to maintain this momentum if it is to significantly contribute to solving the housing crisis.
The 2013/4 English Housing Survey showed that in 2013-14, 19% (4.4 million) of households were renting privately, compared to 17% (3.9 million) households renting social housing and 63% (14.3 million) owner occupiers. This is up from 18% in 2012-13 and 11% in 2003.
The survey also showed that in 2013-14 almost half (48%) of all households aged 25 to 34 rented privately, up from 45% in 2012-13. The proportion in this age group living in the private rented sector has more than doubled from 21% in 2003-04. Over the same 10 years, owner occupation in this age group dropped from 59% to 36%.
Melanie Leech, chief executive of the British Property Federation, said: “The UK is facing an acute housing crisis, and at the same time we are seeing a significant change in the way in which the population is living. The build-to-rent sector is an obvious solution to this. Not only does it offer steady and attractive yields for institutional investors, but it will also provide high-quality, much-needed accommodation for those who are unable to step on to the housing ladder. We hope to see the next government continue to support the sector and encourage its growth.”
Alex Hilton, director of Generation Rent, said: "The growth of the private rented sector is accelerating, and with poor conditions, expensive rents and little security, that's not because it's an attractive place to live. Tenants will only escape the rent trap if government builds much more social housing, but in the meantime we need rent control, secure tenure and decent conditions to make private renting a better place to live for those stuck there."