In fact, it is private landlords who have a strengthened position in the British property market. 61% of properties were occupied by homeowners in 1985 (13.7m properties). Thirty years on, that percentage is exactly the same (now equating to 17.8m properties). Meanwhile, privately rented property accounted for just 1.9m properties in 1985, and accounts for 4.9m today - an increase of over 250% in thirty years.
How has the rental sector changed, then? And why?
Unfortunately, the implementation of Right-to-Buy contradicted Thatcher's actual goals. When it was introduced in 1980, the rate of social renting fell from a record-high 31% to just 20% in ten years. 200,000 homes were sold to their tenants in 1982. By 1987 that number was 1,000,000 council houses in private ownership.
The issue was that the money gathered from these sales was used to reduce debt and not spent on building new houses, hence the continued struggle to keep up with supply and demand since Thatcher's reign.
Then came the 90s. Deregulation made it much easier to rent, but the true value of renting didn't surface until the turn of the millennium. The fact is, the allure of homeownership never wavered, but allure didn't equate with feasibility. The wealth of the 90s made house prices increase dramatically, and people's pockets couldn't handle the pressure. The number of houses sold through Right-to-Buy declined. Renting became the norm.
While house prices boomed, the private rental sector had to match that growth to catch those who couldn't afford to buy. At the time of implementation of Right-to-Buy, privately rented properties accounted for 11% of rented property. Today, we see the results. 22% of British adults privately rent.
The likelihood is for this to increase - the UK is falling way behind in terms of house-building, at just 140,000 builds a year, so prices will only go up. Price goes up, affordability goes down, fewer people own houses, more people have to rent. The numbers speak volumes. Thatcher's dream was an aspirational but infeasible one and this has been realised in the years since its implementation. We now have a property market that is propped up by a strengthening private rental sector - meaning landlords, despite media coverage, are in a healthy position.
Martin & Co is a lettings specialist and can provide advice to all landlords on expanding portfolios, measuring rental rates and managing supply and demand. Please contact your local office with any enquiries.