16:56 PM, 7th December 2023, About 12 months ago
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The UK is facing a rent crisis as record net migration has increased the demand for rental accommodation, according to the boss of Zoopla, one of the UK’s leading property websites.
Richard Donnell, the executive director of Zoopla, told the Telegraph that renting was the ‘first port of call’ for most people who moved to the UK, putting pressure on the supply of rental properties and driving up rents.
He said that many landlords were leaving the sector due to tax changes and regulatory reforms, creating a shortage of rental homes.
According to the latest figures from the Office for National Statistics (ONS), net migration to the UK reached a record 745,000 in 2022, meaning that more people arrived than left the country.
In the two years to June 2023, nearly 1.3 million people immigrated to the UK, mostly from outside the EU.
Mr Donnell told the Telegraph: “We have a triple whammy on the demand side, one element of which is migration.”
He also points to the number of international students heading into the UK – but there isn’t enough purpose-built student accommodation (PBSA) to cope.
The ONS says that 263,000 international students came to the UK in the year to June, mainly from India and China.
He says: “And so you get an overspill of that student demand into the private rented sector.”
Mr Donnell said that one in 10 homes that are advertised on Zoopla are being sold by a private landlord.
He added: “The total number of private rented homes in this country is stuck at 5.5m and it has been for the last seven years.”
Mr Donnell also told the newspaper that some migrants would buy their home eventually, but many remain in the rental sector for longer than usual due to high interest rates and house prices.
He also said that a strong jobs market was fuelling demand for rental accommodation, as more people moved for work.
David Miles, an economist at the Office for Budget Responsibility, backed up Mr Donnell’s suggestion that migration was playing a part in rapidly climbing rates.
He told the Telegraph: “It may be that recent high rates of increase in rents is linked to population increase and to fast growth in student numbers.
“It would be strange if that was not a factor.”
The ONS data showed that rents across the UK increased by a record 8.4% in the year to October 2023, the highest annual growth rate since the series began in 2015.
The average rent in the UK was £1,029 per month in October, up from £949 a year earlier.
Rising rents have contributed to a rise in homelessness and affordability problems for many renters, especially in London and the South East, where rents are the highest.
Charities have warned that the rent crisis is pushing more people into poverty and debt and called for more investment in social and affordable housing.
Beaver
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Sign Up14:44 PM, 7th December 2023, About 12 months ago
Reply to the comment left by PH at 07/12/2023 - 13:59
Well...if the agent manages the bidding process for you and covers the cost of their fee in doing so then you don't need to screen 110 applicants do you?
There's a discussion about that here:
https://www.property118.com/labour-wants-to-ban-tenant-bidding-wars-landlord-explains-why-that-wont-work/comment-page-8/#comment-167906
Mike T
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Sign Up14:48 PM, 7th December 2023, About 12 months ago
Reply to the comment left by PH at 07/12/2023 - 13:56
Be sure the agent is up to the task. Double check what they are doing for you, and never forget that you, the landlord, are ultimately responsible for any and all errors regarding the documentation and compliance etc. etc...
Beaver
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Sign Up14:53 PM, 7th December 2023, About 12 months ago
Reply to the comment left by Mike T at 07/12/2023 - 14:48
That's correct. Including screening the applicant to check that they have the right to live, work, rent property in the UK, and that the agent is able to manage the bidding process for you.
Michael Booth
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Sign Up14:58 PM, 7th December 2023, About 12 months ago
I have long term foreign Tennant Polish always asks me if l know anyone renting any property for friends at work , on the other end of the scale a landlord has had enough of all the government taxes and council chargers put his portfolio up for sale taking £150 k per annum for £1.1 millions with proof of funds only applications.
Beaver
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Sign Up15:27 PM, 7th December 2023, About 12 months ago
Reply to the comment left by Michael Booth at 07/12/2023 - 14:58
Presumably your Polish tenant has the right to live and work in the UK?
Peter S
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Sign Up23:00 PM, 7th December 2023, About 12 months ago
Well who would have thought it, an increase in the U.K. population of close on 20 millions in a quarter of a century combined with an extremely modest number of new houses has led to increases in rent. Hardly rocket science is it!
Beaver
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Sign Up10:51 AM, 8th December 2023, About 12 months ago
Reply to the comment left by Peter S at 07/12/2023 - 23:00
That's right. And over that time landlords have been prevented from deducting their finance costs. You also cannot invest your SIPP in residential property, not even a band A property. And of course to make matters even worse the SNP has imposed rent freezes which would inevitably drive up rents for new tenancies.
So the rental market got more competitive because that's what the policy makers did to it. The house buying process in Scotland is different: This is how it works.
"Sealed bids in Scotland. The house-buying system in Scotland is different. When houses are advertised as ‘offers over’ or ‘offers around’, a closing date will be set and potential buyers will need to submit a sealed bid before that deadline. As a buyer, your solicitor should help you prepare the bid and submit it for you."
https://hoa.org.uk/advice/guides-for-homeowners/i-am-buying/sealed-bids/
So there's a sealed bid process to buy a house in Scotland....presumably then the SNP wouldn't have any serious objection to a sealed-bid system for new tenancies.
Reluctant Landlord
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Sign Up11:33 AM, 8th December 2023, About 12 months ago
Reply to the comment left by Beaver at 08/12/2023 - 10:51
interesting idea!
Pobinr
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Sign Up21:25 PM, 9th December 2023, About 12 months ago
Legal net migration last year = 745k = 6,300 new homes needed/week.
80% of migrants seek out rental property when they arrive = 5,000 additional rental properties needed/week 🥺
= Unprecedented extra demand. Meantime there's a govn't war on landlords so many are quitting, hence rising rents.
"Charities have warned that the rent crisis is pushing more people into poverty and debt and called for more investment in social and affordable housing."
Only need more houses when you have more people. So stop having more people.
We don't want ever denser living & more countryside destroyed for housing & more traffic congestion.
Semi rural towns such as Romsey near me are being ruined. Losing its semi character becoming surrounded with huge estates of 20 per acre habitation boxes.
Urban sprawl is going on all over the country. England's being ruined.
Reduce net migration instead, drastically
Ideally to zero. One in one out. We're full !
SCP
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Sign Up13:30 PM, 10th December 2023, About 12 months ago
Great news item. Blame immigrants and students as a subset.
Who can disagree?
Can our universities survive without charging outrageous fees to the foreign student?
I think that our PM has tried to stop silly courses.
Can our own people supply the required skill sets at an affordable price of labour?