The private rented sector grew to £ 1.4 trn.
The private rented market has made huge profits.
The value of the Private Rented Sector (PRS) in England, Wales and Scotland grew by 5.8 per cent to £ 1.4trn in the past year, according to a new report, The Changing Face of Buy-to-Let from Shawbrook Bank.
Since the first national lockdown, house prices have recovered apace. March 2021 saw home price growth of 9.9 per cent year-over-year as AJD vacation boosted confidence and demand. Buy- to -Let properties have also seen steep price increases, with the average buy-in value to allow property across the UK to increase by 5.6 per cent as of December 2020 to around £ 258,900.
The last eighteen months have been a period of important consequences for the ERP, which had already been affected in recent years by tax and regulatory changes. Some owners chose to exit the market, and the PRS has actually contracted in size over the last year.
On the other hand, many renters made a change, opting to return to IR homestays during the pandemic, leave cities in search of more space, or make the most of the Stamp Duty Holiday and homeowners become themselves. This reduction in the size of therefore ERP is not surprising after last year. However, the outlook is for growth.
More and more people are renting.
The demand from tenants has been increasing. In such a case, 42 per cent of homeowners report that they have seen increased demand for IR properties in the past 12 months.
Additionally, two-thirds (67 per cent) of homeowners said they were confident about the future of the real estate market over the next twelve months, with one-third (34 per cent) of all homeowners planning to buy a property in the coming year.
As house prices continue to grow, an increasing number of people are renting for longer. Half (49 per cent) of tenants say they expect to be renting for the rest of their life. Affordability is one of the reasons behind these figures. However, a growing number are also choosing to continue renting. More flexible lifestyles have led some to seek the same on their property. In this, 10 per cent said they prefer the reduced responsibility for rent, while 7 per cent said renting allowed them to live in a better place than if they had bought a home.
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