Factors Driving Buy to Let - Housing Supply Shortages
Obviously, we have long known that housing supply is not keeping up with housing demand and I don’t see this changing too much soon. Kate Barker’s report for the government showed just how far behind the UK is at providing enough accommodation for all the people who want to live here.
And the UK population is growing rapidly – having just passed the 60m mark a few months ago. There is basically not enough housing to meet this increasing population.
This factor on its own will push up house prices beyond the reach of many people who will then be forced to rent.
In addition to the overall lack of supply of housing, the wrong kind of properties continue to be built as planning policies and constraints mean that developers will build more apartments - whereas what will be needed in the future as a result of demographic changes are more family homes.
In most areas in our main cities capital growth on houses (and rental yields) are now beating that on flats and I think this will continue to be the case in the next 3 to 5 years at least.
And the UK population is growing rapidly – having just passed the 60m mark a few months ago. There is basically not enough housing to meet this increasing population.
This factor on its own will push up house prices beyond the reach of many people who will then be forced to rent.
In addition to the overall lack of supply of housing, the wrong kind of properties continue to be built as planning policies and constraints mean that developers will build more apartments - whereas what will be needed in the future as a result of demographic changes are more family homes.
In most areas in our main cities capital growth on houses (and rental yields) are now beating that on flats and I think this will continue to be the case in the next 3 to 5 years at least.
This entry was posted by lettingfocus, on
Thursday, October 26, 2006.
