The number of people renting homes has soared by a staggering 89 per cent in 10 years as householders struggle to get on the housing ladder, new data has revealed.
Amidst the new buy-to-let boom, a series of ‘rental hotspots’ are beginning to emerge across the country, proving that it is no longer just the capital where large numbers of people opt to rent.
A ‘rental hotspot’ can be defined as an area in which between 20 and 40 per cent of homes are rented out. In 2001 there were just eight areas that claimed this title, yet ten years on, there is now a vastly increased total of 51. The number of tenants in England and Wales has also surged from 1.9million to 3.6 million in the aforementioned time period.
However, it is not just numbers changing but location too. Areas traditionally associated with a saturation of rental properties such as Chelsea and Fulham have kept to the trend, seeing increases of between 30 and 60 per cent in the number of rented properties. However, outside of London, emerging hotspots include a vast range of areas, with Bournemouth becoming the top rental hotspot aside from the capital. Others include Eastbourne, Hastings and Torquay, proving that seaside property has also been sucked into the private rental boom.
With the number of those renting homes soaring by 89 per cent over the last ten years, it is not surprising that many experts believe potential first time buyers will be forced to rent for longer.
Head of Research for Strutt & Parker, Stephanie McMahon commented: ‘The private rental sector has changed dramatically over the past decade, and although this brings us more in line with our northern European peers we are still some way off the scale of the rental sector in countries like Germany and Switzerland. In our view it is likely that overall home ownership will remain between 60 and 70 per cent over people’s lifetimes, but we will see much more openness to rental at different life stages and for longer time periods. It is widely acknowledged that long-term rental is increasingly common, driven by factors such as whether the younger generation are able to raise deposits to buy, or indeed the older generation releasing capital from their homes for care and pensions.
‘There are a significant number of London boroughs where the rental increase has been dramatic with Barking and Dagenham seeing an increase of 230 per cent in 10 years. The varied growth of this market across the UK clearly points to a need to understand local markets rather than just the big picture.’
Source: Residential Landlord