{"id":6037520,"date":"2021-11-24T09:23:39","date_gmt":"2021-11-24T09:23:39","guid":{"rendered":"https:\/\/www.buyassociation.co.uk\/?p=6037520"},"modified":"2023-11-06T16:52:16","modified_gmt":"2023-11-06T15:52:16","slug":"government-must-support-buy-to-let-as-tenant-demand-climbs","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-gb\/2021\/11\/24\/government-must-support-buy-to-let-as-tenant-demand-climbs\/","title":{"rendered":"Government must support buy-to-let as tenant demand climbs"},"content":{"rendered":"

The stamp duty holiday didn’t just help homebuyers; it gave the buy-to-let market a much-needed boost, too. Now the government must keep the momentum going…<\/strong><\/p>\n

Paragon Bank<\/a> is urging the government to ensure “all facets of the housing market” are working effectively, as tenant demand across the country continues to outstrip the availability of buy-to-let homes.<\/p>\n

This comes after the firm analysed how the stamp duty holiday<\/a> – which meant that all landlords received the full 3% tax discount – between July 2020 and June 2021 affected buy-to-let investment. The results showed that there was a surge in landlords<\/a> investing in rental homes during this period, particularly in more expensive areas.<\/p>\n

Locations where transactions rose the most include London, where purchases increased by 52% over the period compared to the most recent pre-Covid period of July 2018-June 2019. The south-east, which is the next most expensive part of the country, saw a 49% surge in completions by landlords, with the south-west seeing a 41% rise.<\/p>\n

Holiday’s over for buy-to-let<\/h4>\n

As the stamp duty holiday came to an end in the summer, though, the buying frenzy in these areas has certainly tailed off. These areas also suffered the most since the introduction of the 3% stamp duty surcharge<\/a> back in 2016, says Paragon, meaning buy-to-let property numbers have dwindled the most in these areas.<\/p>\n

Yet demand<\/a> from tenants remain high, as people are continuing to rent even later in life than before, and the number of renting households keeps rising.<\/p>\n

In other parts of the country, the stamp duty holiday had a lesser effect – perhaps because these areas are already more affordable, and therefore already popular among property investors and buy-to-let landlords. For example, transactions in the West Midlands rose by just 12% over the period.<\/p>\n

What about levelling up?<\/h4>\n

While the government continues to strive to get more people onto the housing ladder<\/a>, it must also consider the growing numbers of renting tenants – many of which are renters by choice – who need good quality accommodation. Standards in the buy-to-let sector are generally higher than ever, particularly with new sub-sectors such as build-to-rent<\/a> pushing up both quality and tenant expectations.<\/p>\n

Paragon Bank managing director of mortgages Richard Rowntree says: \u201cThe impact of the stamp duty saving on regions where house prices are generally higher is clear to see, with transactions in London and the South increasing by approximately half. There were also strong increases in the South West, North East and East Anglia.<\/p>\n

\u201cDespite this, tenant demand still outweighs supply in large swathes of the country, which is leading to record levels of rental inflation, and transactions still remain significantly below the level experienced before the stamp duty surcharge was introduced in 2016.”<\/p><\/blockquote>\n

\u201cAs the Government pursues its \u2018levelling up\u2019 agenda, it needs all facets of the housing market to be working effectively, including a sufficiently sized private rented sector to facilitate labour market mobility and provide good quality homes for those who cannot or don\u2019t want to own a home.\u201d<\/p>\n

Rental demand doubled in major cities<\/h4>\n

The likes of London, Birmingham, Edinburgh,\u00a0Manchester\u00a0and Leeds have been highlighted as some of the key UK cities where rental growth has rebounded to impressive levels. In a new report published by\u00a0Zoopla<\/a>, appetite for central\u00a0city<\/a>\u00a0locations in particular has actually doubled, with outer city areas lagging slightly behind.<\/p>\n

Across the country,\u00a0rental<\/a>\u00a0demand has seen its strongest growth in 13 years, says Zoopla. This even includes London, which witnessed its first rental growth in 16 months. As of the end of September, the cost of renting has risen by 4.6% year-on-year on average across the UK. When you take London out of the picture, this rises to 6% \u2013 a 14-year high.<\/p>\n

The average time it takes for an available property to be rented out was just 15 days as of September this year, according to Zoopla. The report also notes that there as been a shift in spending patterns, with demand increasing in the higher rental price brackets.<\/p>\n

The report adds: \u201cThis will be a reflection of the rises in average rents seen over the last year in the UK excluding London, but also signals an increased demand for larger properties, with more\u00a0space<\/a>, echoing a key driver in the sales market at present.\u201d<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

The stamp duty holiday didn’t just help homebuyers; it gave the buy-to-let market a much-needed boost, too. Now the government must keep the momentum going… Paragon Bank is urging the government to ensure “all facets of the housing market” are working effectively, as tenant demand across the country continues to outstrip the availability of buy-to-let… Read more »<\/a><\/p>\n","protected":false},"author":1069,"featured_media":11363,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[2],"tags":[22,208,85,96],"acf":[],"_links":{"self":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6037520"}],"collection":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/users\/1069"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/comments?post=6037520"}],"version-history":[{"count":1,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6037520\/revisions"}],"predecessor-version":[{"id":6095905,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6037520\/revisions\/6095905"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media\/11363"}],"wp:attachment":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media?parent=6037520"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/categories?post=6037520"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/tags?post=6037520"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}