England’s PRS rockets in value to hit £1.5trn

The private rental sector (PRS) in England has rocketed in value by 30% since 2019 to be worth £1.5trn, research reveals.

The findings from debt advisory specialists Sirius Property Finance looked at the level of stock and its current market value, along with the average yield available before the Covid pandemic hit.

And, despite the government’s best efforts, the data shows that the PRS has grown by 2.4% across England since 2019, with 4.876m properties housing the nation’s tenants.

The growth has been driven by rented homes in the South East with a 9.1% increase, the South West (+7.4%) and the North West (+3.8%).

However, the East Midlands (-9.9%), Yorkshire and the Humber (-0.4%) and East of England (-0.3%) have all seen a decline in PRS stock when compared to the pre-pandemic market.

‘The private rental sector has continued to grow’

Nicholas Christofi, the managing director of Sirius Property Finance, said: “Despite the government’s sustained attempts to dampen the enthusiasm of buy-to-let investors, the private rental sector has continued to grow in size over the last few years.

“This growth, combined with the high rates of house price appreciation seen throughout the pandemic, have pushed the total value of the sector to a quite remarkable level.”

He added: “However, previous whisperings of a hike in capital gains tax will remain a worry for those who have benefited from an increase in the value of their buy-to-let portfolio.

“Should these changes come to fruition in the future, we may well see many landlords scramble for the exit to avoid the government’s latest cash grab.”

PRS has a current value of £1.536 trillion across England

The analysis shows that the PRS has a current value of £1.536 trillion across England and London is home to the most valuable part of the PRS with a valuation of £575.7bn.

However, when compared to the pre-pandemic market, the capital has seen the smallest increase in this total value at 16%.

The South West has driven PRS market performance in terms of the increase in total value, up 41% when compared to 2019.

The total value of PRS stock has also increased by more than 30% across the North West (+39%), South East (+37%) and West Midlands (+31%).

The analysis also shows that of the 4.876m rental homes across England, just 130,272 are currently listed online as available to rent, equating to just 2.7% of all PRS stock.

This, the firm says, highlights the pivotal role the sector plays in housing people today.

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