UK Property - 5 Big Trends for the Private Rented Sector
Dr Diana Babacic, PRS Research Consultancy, Knight Frank
- Private rented sector continues to expand - An additional 560,000 households are expected to be living in the private rented sector by 2023. This takes the total proportion of those renting privately within the housing market to 22%, up from 20.6% today.
- Individual buy-to-let landlords are exiting the market - Mortgage lending data shows that the number of new mortgages taken out by individual landlords has fallen over the last two years. The growth in the number of outstanding mortgages has also slowed dramatically, and is expected to turn negative this year, which will indicate that the market for geared rented property is shrinking for the first time in a decade.
- Home ownership rate declines further - The number of owner-occupiers with a mortgage continues to fall but the rate of decline is slowing, due to ultra-low mortgage rates, stamp duty incentives for first-time buyers and Help to Buy for new homes. However, these factors are unlikely to be enough to stem a continuing, albeit modest, decline.
- Increasing supply of professionally managed PRS , but more needed - There are currently 29,416 professionally-managed PRS units completed, and the current supply pipeline of BTR units is 110,092 (under construction or in planning).
- Increase in provision of social housing - Currently at low levels, it is expected that the provision of social/affordable housing will increase in total numbers over the next 5 years. years. This is a response to looser lending rules for councils, new government funding for social housing and increased activity of Registered Providers in the land market in recent years.
Courtesy: Knight Frank
FOR FURTHER INFORMATION CONTACT
Diana Babacic - Head of PRS Consultancy
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