The government needs to intervene to boost levels of private rented stock, according to Nathan Emerson, chief executive of Propertymark.
When asked to elaborate, he said the UK government needs to start building more and delivering the right type of houses in the right places, as well as incentivise investment in the PRS to counteract a decade of landlords receiving consistent legislative and financial blows.
He was commenting after it emerged that 80% of agents said that the number of landlords leaving had increased in the past three years.
Meanwhile the number of new prospective tenants registering per member branch increased from 68 in the first half of 2019 to 85 in 2021 and 98 in 2022.
Emerson said: “Since 2015, government figures have shown the private rented sector has been slowly shrinking and latest data from Propertymark members suggests that this is nothing to do with demand from tenants tailing off, but instead is caused by the lack of incentives keeping landlords in the sector.
“As we move into the second half of the year, we hope to see slight increases in the levels of stock but without government intervention, these will barely scratch the surface of what is needed, as population growth continues to outpace house building rates.”
On the sales side despite high demand easing the average number of properties listed by member agents was 22 reported in the first half of this year, down from 30 in 2021 and 37 in 2019.
An average of 38% of properties were being sold above asking price in the first half of 2022, up from 24% in 2021 and 5% in 2019.
More letting agents are reporting month-on-month rent increases, with an average of 76% across the first half of 2022 compared to 57% in 2021; and 37% in 2019.
Emerson added: “Over the past six months, we’ve seen significant shifts in trends that professionals in the sector had been accustomed to.
“Mortgages including buy-to-let, which are on short term, fixed contracts, have been at historically low interest rate levels for years but are now rising sharply. Property owners seeing increases to their monthly repayments are having to raise rents. This is leaving many renters in difficulty due to affordability at a time where other costs are also rising.
“Despite inflation and interest rate rises, the sales market has so far continued to remain buoyant during turbulent times with homes under offer extremely quickly. However, with a continued rise in the number of buyers, stock levels need to increase.”
The Government should incentivise the PRS! They have done nothing but discourage and vilify it for years. For many PRS landlords the tax relief changes and the proposed renter’s reform bill along with mandatory EPC ratings could just be the final straw. Why you become a buy to let landlord paying hundreds of thousands for a property you are not going to be in control of? Where bad tenants can sit in place not paying rent and damaging it for up to a year while you try to get them out with virtually no chance of getting the arrears back and with councils telling them illegally to stay in place until thrown out by bailiffs. That and the Government imposing an eviction ban in difficult times with no landlord compensation. They did it once, what’s to say if the recession bites and more and more people slip into rent arrears as they surely will, they wouldn’t do it again to prevent homelessness? Or impose rent controls. Yes, the Government sure knows how to incentivise the PRS. They hate it as the PRS holds up a mirror to their serial failings to house the population.