227,000 new private rented homes required per year to meet government targets

227,000 new private rented homes required per year to meet government targets

9:39 AM, 14th February 2022, About 3 months ago 11

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The UK needs almost 230,000 new private rented homes a year to meet government housing targets across the UK, according to a new report by the economics consultancy, Capital Economics.

The report, commissioned by the National Residential Landlords Association, observes that Government targets would amount to the need for 340,000 new homes a year across the UK by the middle of the decade.

Capital Economics finds that if owner-occupation and social housing continue at their ten-year average rate of growth, private rented sector supply would have to increase by 227,000 per year to meet government targets and an anticipated 1.8 million new households over the next ten years.

It notes that even if the other [housing] tenures doubled their rate of growth, 105,000 homes for private rental would be needed each year, which is well above current rates of growth.”

The projections come as government figures show that the supply of private rented housing in England has fallen by almost 260,000 over the past five years.

Given that renting privately is the first tenure nearly all young people enter when they want or need to leave home or university, demand will only increase as the 15-24 cohort in the population is forecast to grow between now and 2030 by 866,000 (11 per cent).

Modelling by Capital Economics suggests that without changes in tax or other policies, the private rented sector stock will decrease by around a further 540,000 properties over the next ten years.

 The report sets out how, in order to meet targets for housing supply the Treasury needs to encourage investment in the sector. Greater investment in the sector would, it argues, support the provision of new housing through a combination of an increased rate of new builds; the switching of commercial property to residential use; the switching of stock from short term to long term lets and bringing empty homes back into use.

The report further notes that, whilst some of the demand for new rental properties will be met through build to rent schemes, this remains a small portion of the market. Individual landlords, it notes, remain the largest providers of private rental accommodation by some distance.”

Ben Beadle, Chief Executive of the National Residential Landlords Association which commissioned the research said:

“Today’s report highlights in stark detail the supply crisis now engulfing the sector. For all the efforts to support homeownership, the private rented sector has a vitally important role to play in helping the Government to achieve its housing objectives.

“Without urgent action, the increasing number of people looking for affordable housing will be the ones to struggle as they face less choice and higher rents as supply dries up.”

Andrew Evans, Managing Economist for Capital Economics said:

“The private rented sector, which is predominantly supported by private individual investors, has a key role to play in addressing housing need in the UK. However, the stock of homes for private rent has fallen in recent years, driven partly by a series of policy changes. Without further changes, that supply could fall by over half a million more over the next decade. Even with increased provision of affordable housing and higher rates of owner occupation, both of which are important, our research shows that significant additional investment is needed by landlords in the private rented sector. “



Comments

by L

10:04 AM, 14th February 2022, About 3 months ago

The government seems determined to do everything but encourage the supply of new homes in the UK. The tax requirements for private landlords has become more and more punitive and the new EPC regulations due to take effect in 2025 will decrease the avaiable stock of prIvate properties for rent where the governemet has not realised the number of older rented properties that would need extensive investment to be compliant.
The other side of the coin to give a balanced view is that people went silly with greed in the buy to let market buying 30-40-50 properties and they should also shoulder the responsibilty for the ever punishing tax by HMRC for private Landlords.
The governemet needs to encourage more prIvate landlords into the market but Landlords need to be sensible too.

by Ian Narbeth

10:52 AM, 14th February 2022, About 3 months ago

Andrew Evans, Managing Economist for Capital Economics said:
“The private rented sector, which is predominantly supported by private individual investors, has a key role to play in addressing housing need in the UK. However, the stock of homes for private rent has fallen in recent years, driven partly by a series of policy changes."
Come on, Mr Evans, you make it sound like a little tweak here, a little "policy change" there, will sort out the crisis. What you might have said is:

"Government and local authorities have attacked private individual investors on various fronts over the past 7 years. They are taxed on their mortgage finance. They may receive massive fines for technical offences. The court system is clogged up. It can take 12 to 24 months to get a defaulting tenant out. Local authorities encourage, nay demand, that tenants disobey court orders to leave and wait until the landlord has incurred additional cost (and had to endure more months with no rent) to employ bailiffs. If tenants commit criminal damage, the police show zero interest. At the same time, local authorities have introduced selective licensing at substantial cost to landlords. The Tenant Fees Act 2019 has introduced a number of subtle traps for landlords and the forthcoming abolition of s21 will leave landlords fearful of a return to the Rent Acts which stultified the market for a generation. All the while, landlords as a class of persons are vilified as "rogues". "
The only people who are surprised that there are fewer houses available to rent are politicians and tenant lobby groups.
I predict that rather than an increase in properties for rent there will be a decrease in 2022 and rents will increase, benefitting those who continue to risk all in the housing lottery and adding to the profits of the true rogues who don't care if they are in breach of five laws and regulations or fifty five.

by Luke P

11:23 AM, 14th February 2022, About 3 months ago

I've said it before, but in case anyone with any power happens to read this...allow landlords (or anyone) to 'bring-back-into-use' (or build) a property specifically for the rental market, with a minimum term, that ultimately will be CGT-free. There are a couple of million PRS LLs and loooooaaads of empty/run-down properties out there, so virtually overnight you could add an absolute tonne of rental properties into the sector.

by Luke P

12:13 PM, 14th February 2022, About 3 months ago

Reply to the comment left by Luke P at 14/02/2022 - 11:23
It would definitely be a whole lot quicker than trying to build the country's requirements...

by Freda Blogs

13:37 PM, 14th February 2022, About 3 months ago

Reply to the comment left by Luke P at 14/02/2022 - 11:23
Good idea, but far too sensible Luke. Don't forget that Shelter and Generation Rant all think that those properties would represent a net loss to the owner occupied/first time buyer market - even though most of those prospective buyers haven't got the funds/ time/ desire/ expertise/ to do up those properties.

And, just supposing the Govt gave such a scheme the thumbs up, would you trust Boris and his cronies not to move the goal posts and slap the tax back on?

by Mick Roberts

15:15 PM, 18th February 2022, About 3 months ago

L & Ian say it all, I'll add to it with my whatsapp text I send to tenants ONLY after I've spoke to them.

I've not finished this, only rough draft.

Most of u r very good. But are u perfect? Read Licensing conditions and tell yourself first could u comply with all them, second, would u take any tenant on that wasn't the most prim proper person ever?
Third, if u was a landlord getting older, would u want to be dealing with that for EVERY house EVERY tenant? And giving out 200 pages to each tenant each house.
Selective Licensing conditions Feb 2022
https://docs.google.com/document/d/1sD_HRl57ANNw4PBAb-FGRU7h-0Qby9Vm5xLioH_nA7c/edit

Please ring me about this text and read to the end before u panic.

We'd like to sell your house within 10 years for the reasons below. We can sell it u and pay your deposit for u, if u r able to buy it. Sell it to someone u know who would keep u in. We have people who may buy & keep u in.

Lot of Landlords give tenants 2 months notice. We recognise this is your home, and would never contemplate selling on u if you've done nothing wrong, however the Council's and Govt are making it really difficult for the good Landlords-All to get back at the bad Landlords.

We are only in this position cause the Council's and Govt are bringing that many rules in retrospectively, they making it extremely hard for good landlord that's abiding by the rules and is getting older, to carry on.
We doing 4 times the amount of admin, paying out thousands in unnecessary costs-Nothing which makes your home better.

U should all really be writing and meeting your MP and Councillors and Govt and Council and telling em what they are doing to people who didn't have a problem before.

The latest rule they are now proposing to bring in in 2025 is EPC to a C. I've already got the Combi boiler, UPVC etc., so it's external wall insulation. Approximately £10,000 each house, but they not bringing it in for Council houses or Owner houses-Only to Private Landlords.

I never thought we'd be in the trap we in now where Councils and Govt have made it that bad for Landlords, that it's made it extremely hard for Benefit tenants to move house.
Years ago, u had a choice to move, and then I'd have sold your house as u moved on. We all in a trap where u can't move now if u want to. Govt and Councils has done this to u. Landlords packing up in their droves due to Licensing and Universal Credit.
It's also the bad tenants some of these rules are being bought in for, which makes it unfair for u good ones.

I used to be able to give u keys, service your boiler and u tell me when something needs doing. I'm now doing courses at 4am just to keep u in your home. And many of u aware, I don't want the houses any more, only keeping them to keep u in your home.

U can buy it now if u or your buyer can arrange it. Also happy to wait for u up to 10 years. I'll pay your 5% deposit if u can buy it.

Please work with me and let's find a Landlord that is younger and not weary of the all the latest rules, who's happy to keep u in for 10+ years. I'd get a lot more selling it empty, but I'm mindful that it's been your home for years, so am prepared to lose £10,000 to sell to discount Landlord to keep u in your home.
And selfishly, I can't carry on forever in a job that the Govt & Councils are making it harder & harder & more hours on unnecessary burdens.

I may have a few people now who wish to buy and keep u in if u wish to go ahead now.

Some of u have been with me 24 years and I don't take this decision lightly.
Some of you's kids are also getting older and your Housing Benefit towards the rent will drop massively when your kids are 18 or leave. I used to have affordable flats for u to move into. Now the people aren't moving from my flats any more.

Govt & Councils are making far too many retrospective changes when the tenant has already lived there years & the Landlord bought the house years ago. If people have not had a problem for years, Govt & Councils should be rewarding them and lower costs, not penalising them and higher costs.

U can start to stop this spiralling lack of supply of houses to yourself by emailing the below and putting your name address phone number at top of email.

selectivelicensing@communities.gov.uk

Councillor who responsible for Licensing fee increase
linda.woodings@nottinghamcity.gov.uk

Nottm Council Labour boss who supports Licensing
david.mellen@nottinghamcity.gov.uk

Nottingham North MP
alex.norris.mp@parliament.uk

Below is other reasons which are forcing my hand:

We now have to do Fitness tests on new rentals £150 each house.
Electrical Installation Condition reports organisation & implementation £300+ each house.
Selective Licensing £890 just for one house.
Legionnaires checks £70 each house.
EPC’s £80 each house.
EPC’s soon to a C each house approx £10,000
Data protection checks £40.
Carbon Monoxide detectors & smoke detectors, when wired, £300 each house.
Getting registered with Information Commission officer £40.
Floorplans, Inventories £90 each house.
Landlord has to criminal check himself & has to prove he has Right to live in UK
Increased staffing admin behind the scenes.
As you’ve seen, checks/inspections on your houses now with smoke alarms-Should be much more detailed checks.
Consultant & Legal fees to keep pace with legislation & staff training.
Letting Agent costs for new tenancies & house swaps £70pm each house.
All the above is extra costs we din’t have when many of u moved in.

Below are other reasons why Landlords are packing up & why u can’t get anywhere any more, & remaining Landlords charging what rent they like:

1. Wear n tear allowance scrapped.
2. Stamp duty for BTLs.
3. 100% council tax payable on void properties from day 1 (not even a 25% discount).
4. Reduction in deposit amounts ( 5 weeks is woefully inadequate).
5. Unable to take pet deposits.
6. Council tax single banding for HMOs.
7. Section 24 tax, no other business is unable to offset their costs.
8. Numerous unfair decisions against landlords made by the deposit schemes, whilst landlords are unable to have a rogue tenant database, only a rogue landlord list.
9. Scrapping of fees for application and referencing which has led to higher costs from agents.
10. The lack of help with COVID and the court system being unfit for purpose, with a further insult of section 21 being scrapped!

by Ian Narbeth

15:23 PM, 18th February 2022, About 3 months ago

Reply to the comment left by Ian Narbeth at 14/02/2022 - 10:52I happened to see a bit of Nightmare Tenants, Slum Landlords earlier this week. They followed some poor landlord and the narrator casually remarked that the tenants had "followed the Council's advice" not to leave until the bailiffs came.
The narrator might instead have said: "The Council has told the tenants to disobey the court order to leave and threatened that, if the tenants obey it, the Council would not re-house them."
Do the judges know or care that their orders to leave are routinely ignored and that Councils are party to this disobedience?

by Luke P

15:58 PM, 18th February 2022, About 3 months ago

Reply to the comment left by Ian Narbeth at 18/02/2022 - 15:23
What, if anything, would be the penalty were someone be able to obtain (in writing) a council telling a tenant to disobey the Courts?

by Ian Narbeth

16:28 PM, 18th February 2022, About 3 months ago

Reply to the comment left by Luke P at 18/02/2022 - 15:58
At most a civil contempt of court. I suspect judges know that Councils do all they can to pit off the evil day when they have to re-house so I doubt the judge would do much even if you could prove it. I would love to be proved wrong.

by Mick Roberts

16:39 PM, 18th February 2022, About 3 months ago

Reply to the comment left by Ian Narbeth at 18/02/2022 - 16:28
U the expert Ian,

About 3 years ago Section 21 Possession notice.
Tenancy was (don't hold me to these dates) 30 Sep 15 I think. Before the 1st October 2015 deadline for Must give tenant boiler certificate. So din't apply to her.
Judge said he wanted to see proof I'd gave boiler certificate. (He clearly din't know all the latest rules that's constantly chucked against us every week).

So I paid my solicitor approx £500 to sit at court for 3 hours only for him to tell Judge the tenancy was before that new ruling date.
PLUS I get all my tenants to sign the letter below, so apparently I'm covered.

But relating to this thread, why can't we hold the judge accountable to pay our fees when they make ridiculous willy nilly off the cuff for them, errors that can cost us so much?
I've got another happening as we speak & I really want to say Judge, u know your actions delaying this case, u know what it does don't u? U temporarily help this tenant. But then u make it 100 times harder for the next tenant who I otherwise may have took but because I know u make it very hard for us to get bad tenants out, I ain't taking one again. Only Letting Agent tenants next time.

Judge, your actions albeit u think to help this person, makes it worse for the next 1000 tenants for each Landlord u make life difficult for.

Would I be in trouble for this?

Dear Sir,

I confirm, there is Carbon Monoxide Detector, 2 working smoke alarms in the property, & I will make sure when I vacate, there will be Carbon Monoxide Detector, two working smoke alarms fitted of the same calibre with no flat batteries. I am responsible for testing, maintaining/cleaning and replacing batteries.

I have been given copy of EPC, EICR, boiler service certificate, GDPR Data protection notice, & how to rent guide & website link which has the latest info on & is: https://www.gov.uk/government/publications/how-to-rent

I understand Landlord doesn’t do carpets & curtains, nor decoration.

Yours sincerely,

Tenant

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