Studies suggest Housing Crisis may get worse
Landlord news by Madalena Penny
In the wake of Government changes being applied to the private rented sector, many landlords are probably wondering how these changes will affect them. It appears all well and good that the Government want to balance out the sector, but has anyone thought how these changes will affect tenants?
This week’s survey released by the NLA (National Landlords Association) suggests that one in five landlords are planning to reduce the size of their property portfolios. If so, the demand and supply quota for available housing stock could see rental prices soar.
The withdrawal of mortgage interest relief, a 3% surcharge on additional properties purchased by landlords, and the tenant fee ban due to be rolled out next year, has made investment in the private rented sector less appealing to many landlords.
But what does this mean for the tenant?
At least the letting fee ban will see off unscrupulous agents, and give the tenant some much needed respite against undue fees, but what about rent increases? In the long-term, it will be both landlord and tenant who suffer under changes to mortgage interest relief, and surcharges. Wouldn’t a business model that increases available housing, by making it easier for landlords to buy properties, increasing the number of affordable homes, and thus reduce the average price of rents be better? It’s a no-brainer really.
Last years study by the University of Reading, aptly titled ‘Understanding the Next Housing Crisis’, suggested that the UK would never build enough affordable homes, and that younger people would not be able to afford rising house prices, which are on average eight times peoples earnings. This, of course will add extra strain on the private rented sector, who will, no doubt be taking up the slack.
A spokesman for Shelter said:
“The housing crisis isn’t about houses – it’s about people. It’s the family struggling to meet the next month’s mortgage payment. The young family renting a rundown flat, wondering if they’ll ever be able to afford a home of their own. The children living in temporary accommodation, forced to change schools every time they move.”
Yes, there needs to be changes made to private rented sector, but fair ones that benefit all. What is needed is sound morals, good ethics, intelligent answers to a housing crisis, and above all a Government that can move this Country forward.