Lack of private rented stock coming to market

Private rented stock levels have crept up across Britain by just 0.8%, which goes some way to explaining why rental growth stood at 11.5% in May.

There’s been a slowdown in the East Midlands (-7%), Scotland (-5%), East of England (-2%), West Midlands (-1%), Wales (-1%) and Yorkshire and the Humber (-1%) have all seen a decline.

Despite this short-term negative trend, Octane Capital estimates that the sector will bounce back by 2025.

The firm reckons the UK rental market will grow by a 6.5% by 2025, bringing 308,000 homes to the sector.

Jonathan Samuels, chief executive of Octane Capital, said: “The performance of the private rental sector has been somewhat mixed of late, with growth stagnating in some regions, even declining in some cases.

“This is hardly surprising, with a raft of legislative changes designed to deter landlords from the private rented sector complemented by a severe drop in demand during the pandemic.

“Despite this, the market remains substantially larger than it was back in 2005 and looks set for a return to form over the coming years, growing in size across all but one area of Britain.”

West Midlands sees biggest long-term growth

The West Midlands has seen the most market growth in terms of the private rented sector, which has increased by 113% since 2005, Octane Capital analysis shows.

The North West (98%), Wales (86%) and East Midlands (86%) have also seen some of the largest PRS market growth since 2005.

The South East has added lowest percentage of new homes, at 62%.

From now until 2025 Wales is expected to post the strongest growth, with the privately rented sector increasing in size by 9%.

Hamptons research shows that rental growth stood at 11.5% in May, led by London (15.7%), the South West (13.4%) and the North (10.3%).

Comments 2

  1. Investing in the Private Rented Sector has become like speeding through a traffic speed camera at 150mph. It is envitable you will lose out to the public authroities.

  2. Yes but the authorities are idiots
    Idiots don’t win in the long term
    Move to holiday lets
    Come back to STA when the idiots have all been kicked out at next election

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