R
Ricky Bhurji
Member
Premium Member
I was reading a report which came out earlier this week which caught my eye and made me think about where the housing market may be in a few years time - not just the residential sales market but also the rental sector.
Its common knowledge that first time home buyers have been struggling to get onto the ladder - some of the reasons - securing a large enough deposit, wages not keeping up with the rapid appreciation of property in the last 3-4 years are familiar themes.
But has anyone thought about renters?
The new report suggests that even renters/tenants could be priced out of the rental sector by 2026 because deposits will rocket by 40% to an average of £1,111, which is some 70% of the average UK workers monthly income. 68% of the country will then be taking the equivalent of six weeks' rent.
Of course this problem is likely to be even worse in the capital where the average deposit will rise to £2,733 which is 120% of the average monthly salary!
In the South East, the average deposit will rise to £1,469 which is the equivalent of 83% of the average monthly salary - whilst in the South West, renters will be paying out 80 per cent of their median monthly salary.
In general, it is widely expected that the average monthly rent will rise by 19% in the next 10 years - with a third of households in England and Wales renting by 2026.
My thoughts are that with the forthcoming changes to legislation and the crackdown on buy to let mortgages - this will erode Landlords profit margins and will force them to pass these rising costs onto renters/tenants. It has been speculation that later down the line it is likely that some Landlords will ask for 8 weeks worth of deposit, instead of 6.
Where does it end, and what can the government do to help renters? Surely the opposite of what they are doing currently?
Ricky
Its common knowledge that first time home buyers have been struggling to get onto the ladder - some of the reasons - securing a large enough deposit, wages not keeping up with the rapid appreciation of property in the last 3-4 years are familiar themes.
But has anyone thought about renters?
The new report suggests that even renters/tenants could be priced out of the rental sector by 2026 because deposits will rocket by 40% to an average of £1,111, which is some 70% of the average UK workers monthly income. 68% of the country will then be taking the equivalent of six weeks' rent.
Of course this problem is likely to be even worse in the capital where the average deposit will rise to £2,733 which is 120% of the average monthly salary!
In the South East, the average deposit will rise to £1,469 which is the equivalent of 83% of the average monthly salary - whilst in the South West, renters will be paying out 80 per cent of their median monthly salary.
In general, it is widely expected that the average monthly rent will rise by 19% in the next 10 years - with a third of households in England and Wales renting by 2026.
My thoughts are that with the forthcoming changes to legislation and the crackdown on buy to let mortgages - this will erode Landlords profit margins and will force them to pass these rising costs onto renters/tenants. It has been speculation that later down the line it is likely that some Landlords will ask for 8 weeks worth of deposit, instead of 6.
Where does it end, and what can the government do to help renters? Surely the opposite of what they are doing currently?
Ricky
