Deprived areas hit hardest by shortage of rental stock

Deprived areas hit hardest by shortage of rental stock

0:02 AM, 6th September 2023, About 8 months ago 6

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People living in the most deprived areas of the UK have seen their rents skyrocket this year, according to new data.

Research by estate agents Hamptons reveals in 2019, renters in the most deprived regions were paying an average of £499 a calendar month – by 2023, that had shot up to £759.

In contrast, those renting a property in Britain’s most affluent districts were paying an average monthly rent of £1,078 in 2019, going up to £1,387 this year.

Shortage of rental stock

According to Hamptons, landlords in less affluent areas rely more heavily on mortgage finance than their wealthier peers, helping to drive up costs.

Tenants in deprived districts have seen monthly rents increase by £97 since 2022.

David Fell, lead analyst at Hamptons, said: “It’s been the least affluent places which have been hit hardest by the shortage of rental stock, with larger falls in the number of rental homes on the market in the least affluent areas since 2019.

“Rental growth since 2019 has predominantly been driven by higher interest rates, specifically the larger proportion of landlords operating in less affluent areas relying more heavily than anyone else on mortgage finance.”

Rents spiral out of reach of local incomes

Of the most deprived regions in the UK, the district with the highest percentage rise in rental costs was Linthouse, Glasgow, where monthly rents increased from £597 in 2019 to £985 this year – a rise of 65%.

Lozells in Birmingham saw monthly rents increase from £616 in 2019 to £934 in 2023.

For tenants in Ascot in Berkshire, rents are higher than in Linthouse but the percentage increase is far lower. Monthly rents rose from £3,224 in 2019 to £4,163 in 2023 – an increase of 29%.

Polly Neate, chief executive of Shelter, told the Observer that rents are spiralling out of control.

She said: “The private rental sector is creaking under the weight of demand as rents spiral out of reach of local incomes and tenants are pitted against each other for a limited supply of homes.”


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Comments

Morag

10:19 AM, 6th September 2023, About 8 months ago

This reflects my experience in a similar area of Glasgow. My tenants have been paying 490 and 500 since 2012, and indeed I had no reason to increase it as local rents also didn't change much, until maybe a year or so ago. In the last few weeks I saw a property identical to mine snapped up at 795, and there's another just on at the same price. My mortgage payments have increased meantime by £580 per month, but I'm allowed to increase the rents by £15 each, or £30 if the housing tribunal agree. Hardly seems worth the paperwork. I'm encouraging the tenants to buy the properties, but not sure if they realise the urgency. Both governments are proposing still more tenant protections, so what's left for them to do? No rent increases, no evictions, and no sale with a tenant in situ?
Every new outpouring from Polly and the like must cause another wave of landlord departures. When are they going to realise the harm they are doing? Most of us landlords will get by and find somewhere else to invest our hard earned savings, but it's the people who need to rent I feel most sorry for.

TheMaluka

10:26 AM, 6th September 2023, About 8 months ago

Reply to the comment left by Morag at 06/09/2023 - 10:19
What's left? State confiscation of your property without compensation.

Teessider

18:41 PM, 6th September 2023, About 8 months ago

There will be far fewer rental properties available in the most deprived areas if the proposed changes to minimum EPC Ratings goes ahead, as planned, in 2028.
Housing policies should be set by people that live in the real world rather than those that live in a different reality. Politicians, NRLA, Shelter, Generation Rent shouldn’t have any input.

There’ll be streets and streets of boarded up slums.

Dylan Morris

8:03 AM, 7th September 2023, About 8 months ago

Money printing > inflation > higher interest rates > higher rents

Reluctant Landlord

8:39 AM, 7th September 2023, About 8 months ago

Reply to the comment left by Morag at 06/09/2023 - 10:19
but if you dont do it you then send a message to the powers that be that you are easily walked over. If every LL did put up the rent to what is being allowed then this shows that rent increases ARE necessary for them to carry on renting in the first place..

If every LL put up rents to the max allowed then the tribunals/government will see that imposing a cap brings more LL's out looking for what they can get rather than letting LL's make their own decision if they increase or not. Further evidence the policy will hit ALL tenants whereas before interfearance there would have been more tenants paying a lower rent....

They are keen to screw us all over so always raise the rent where you can to market rate.

ICEMAN

20:18 PM, 7th September 2023, About 8 months ago

Guess the message is to increase rents to market rates... Before the government makes that illegal for everyone (apart from their own stock)... Capishe

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