The Private Rented Sector (PRS) continues to soar in popularity as young people struggle to get on the property ladder. House prices continue to grow at unprecedented rates around the country contrary to sluggish economic growth in other markets fuelling investment in to new developments and projects. In this environment it’s no surprise that those in PRS are growing in numbers constantly but perhaps more surprising is the changes in dynamic within the sector.
Classically young couples, the bulk of whom are professionals, have made up the largest group of private renters as the flexibility is often appealing, and is ideal for when they are saving for a deposit. The route to home ownership often starts after moving in with a partner and pooling resources but The latest research from the National Landlords Association has found that, for the first time, the most common household type in the private rented sector are families.
According to the data, more landlords now let to families with children (48%) than any other household type, overtaking young couples (47%). This represents a shift compared to four years ago, when young singles made up the largest group (53%), followed by young couples (51%), and then families with children (51%). The PRS now accounts for approximately 5 million households in the United Kingdom and, according to the latest English Housing Survey, the proportion of families in the PRS has increased from 30% in 2004-5 to 37% in 2014-15 – an increase in roughly 1 million (912,000) households in ten years.
For the majority of families surveyed, renting privately is a stable option, with almost 8 in 10 (76%) reporting they were happy with the length of their tenancy, and a similar proportion (79%) reporting their tenancy was renewed or stayed the same at the end of the initial fixed term. As a result, the perception of renting as a barrier to family life is breaking down, with nearly
two-thirds of renting families (60%) saying that it was not. 77% of families considered their rented accommodation to be home, and the majority (65%) reported that they were free to personalise it however they chose.
Startling figures that show the changing of the tides in the PRS as rather than being seen as a short term option whilst saving to get on to the housing ladder many are now seeing the benefits and flexibility of renting rather than owning.Certainly for families there are considerable benefits including stable costs,low maintenance outgoings and the ability to move quickly.
As investors increasingly move in to the property sector as a safe haven for their money standards are increasing and regulation has improved. Yields and capital appreciation are making property investment the most attractive prospect in the UK and as popularity grows so too does confidence. Despite the increases in taxes implemented by the chancellor investment remains high and landlords are increasingly moving towards reputable agents as a means of offering excellent conditions to tenants which in turn provides long term tenancies and good tenants for their properties. Indeed improvements in the services offered by letting agents have meant a better deal for all involved and landlords increasingly see the benefits of outsourcing their property management.
As the net widens for renters and traditional reasons for renting evaporate for a modern world it certainly can be argued that property represents the best value for landlords, and as the renting market diversifies in a modern market there are benefits for approaching the experts. Letting agents will and have improved relations and conditions for landlords and tenants alike and as the market prospers we can expect to see their popularity increase.