10:32 AM, 15th March 2016, About 6 years ago 6
Paragon Mortgages, one of the original lenders to help develop the Buy to Let market, has requested the Chancellor halt any further financial attacks to discourage Buy to let landlords ahead of tomorrows budget. It calls for a comprehensive review of the UK’s housing strategy to be carried out to meet the needs of a growing population instead.
This is backed up by forecasts that the UK’s population is set to increase from the current 65 million to 73 million by 2039.
Paragon commissioned an independent report carried out by the London School of economics. The conclusions in this report confirmed that the Private Rented Sector has a massive influence and role to play in the housing market, and that any reduction or decreased expansion in the supply of privately rented properties as a result of changes in mortgage interest relief taxation, Stamp Duty and regulation will potentially increase the pressure on rental prices and adversely affect household budgets.
Chief executive of the Paragon Group, Nigel Terrington, said “The government needs to instigate a thorough review of UK housing need in the context of the expected population growth. The size of forecast population growth is the equivalent of nine cities the size of Birmingham.
The private rented sector is an important provider of homes for people in the UK. For many years, successive governments have actively reduced the provision of social housing. This, together with other regulatory changes such as the Mortgage Market Review which has restricted mortgage credit to homebuyers, mean more people are turning to the PRS.
“There is real risk of lasting damage to the sector if the impact of the changes is not fully understood and particularly if the government continues to layer one measure upon another without a thorough and robust assessment of the progressive impact different measures will have.
“The PRS does not have a binary relationship with home ownership: holding back growth in the number of properties for rent will simply not increase home ownership and may increase costs and reduce amenity for tenants.
“In the context of forecast population growth, together with a current and projected housing shortage, the key requirement is for the government to create a stable policy framework that will encourage investment in the supply of good quality, affordable housing across all tenures, so that people can choose the best housing option to suit their lifestyle.”
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