Residential Renting – No Longer Poor
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An Englishman’s home is his castle. These are the fine, noble sentiments us Brits grew up with. Any child of the 80’s will have grown up with Thatcher’s aspirations of home-ownership for the masses, thus conceiving the home-ownership trend that has revolutionised the property industry and dominated a social and cultural mindset for the last 30 years. That is until now.
In comparison to average family salaries, paying the large deposits lenders now insist upon to validate in securing mortgages, home-ownership has become a mere pipe dream for anyone trying to step on that property ladder. The recession has not only resulted in financial consequences, but an end of an era. Social changes, values and aspirations will reach a turning point that will no doubt alter our views on housing needs, putting us on the similar lines with the rest of Europe.
The emerging trend from all this has been the growth of the private rented sector, which data indicates is now worth a formidable £500bn in the UK of which 73% of properties are owned by individual landlords. While social housing and new builds are suffering, forecasting a housing crisis, it becomes evident that the future lies in the PRS.
While once viewed as housing the poor and the vulnerable members of the population, the private rented sector is now supporting the housing needs of people from every class in the spectrum. Landlords are experiencing a decline in rental arrears as tenant demand increases creating 5.5 tenants to each available vacant property allowing more choice of tenant for the landlord. Evictions and notices are also declining suggesting a ‘settling in’ and acceptance of the recent shift in tenanted accommodation trends.
Sim Sekhon, industry spokesman and senior partner for Legal 4 Landlords said,
“June saw our highest number of tenant reference requests and our regional franchise opportunities are selling faster than originally anticipated. It’s clear that the increasing tenant demand is having a tremendous effect on all sectors operating within and around the private rented sector.”
Whether we like it or not, the UK is set to follow our European cousins, where countries like Germany, France and Italy who consider renting privately as the norm without any stigma or prejudice.
By
Madalena Penny