It has been featured in the news recently that Birmingham is the latest UK city to be hit by a rather large shortage of rental properties. It seems that there is extremely high demand for rental properties in the West Midlands city.
Thus, one can conclude that it has never been a better time to be a West Midlands landlord. With so many tenants hunting for a rental property, you would be sure to receive interest in your property, provided you market your property appropriately of course.
London was the first city to experience a shortage in rental properties, with most landlords stating that they were receiving too many tenants that they simply could not accommodate for. The shortage of rental properties has not gone unnoticed however with the government implementing the Affordable Homes scheme. The plan is currently to build a grand total of 80,000 new homes over the next four years. The scheme is worth £1.8 billion and will provide for the ever increasing demand for affordable homes.
In the meantime, the rental sector is gathering pace as buy to let is looking an ever increasingly attractive choice. The economic crash sent ripples through the buy to let sector and many landlords fell flat on their face at the time, however, with rental demand currently through the roof, and property prices currently stable but low, landlords around the country will look to purchase new properties and rebuild their portfolio. Also, with the return of lenders towards the end of last year, funding has also picked up.
Figures have also recently been released by the Council of Mortgage Lenders to reveal that in the second quarter of 2011 buy to let loans increased by 21% to £3.5 billion. From April to June, there were 32,000 buy to let loans taken out, this is the highest number, and value, since the end of 2008.
The Association of Residential Letting Agents has also stated that 74% of respondents to a landlord survey they conducted said that they received more tenants than they had properties available.
Improving demand has meant that buy to let has taken up a bigger share of the mortgage market and, Capital Economics has also suggested that 17.2% of all homes will be privately rented by 2015. That’s a staggering number of landlords that will be looking for landlord insurance quotes!
John Heron, Managing Director of Paragon, has stated that one in five homes will be from the private rented sector by the end of the decade.
Meanwhile, many have warned that the industry must remain vigilant against bad practices that were rife during previous boom periods many years ago.