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A report by a mortgage lenders association has predicted that nearly half of homes in the UK will be rented by 2032. This is a direct reversal of previous trends. In 2003, seven out of ten homes were owner-occupied. Eleven years later, this has fallen to 65% and the Intermediary Mortgage Lenders Association (IMLA) predicts that the number of owner-occupiers will continue to fall even further.
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IMLA Report Findings The report’s authors say that the UK’s relatively small private rented sector is as a result of a huge expansion of the country’s social housing in the 50s and 60s, government policies that favoured the right to buy and rent controls in the private rental sector.
“The growth of the private rented sector can therefore be considered in some sense a normalisation after a period when government policy artificially suppressed the sector’s size,” says the IMLA report.
The report also notes that there is a shortage of new homes in the UK, which is something that the government needs to address. It has identified several key factors that are causing an expansion of the private rental sector. These include:
• a rising student population; • high levels of immigrants coming to the UK; • breakdown of relationships; • a lack of social housing; and • difficulties obtaining a mortgage.
Rising Demand for Buy to Let Property The UK population is expected to reach 75.3 million by 2035, which is going to place enormous pressures on the current housing stock.