Here are some of the most interesting stories from the past week:
Pensioner property wealth hits £1.054tr
The rise of the ‘silver landlord’ has been a known phenomenon for a while now. Retirees are cashing in their pensions and using the lump sum to enter the world of property investment in order to secure their future.
However, just because we know this is happening, it doesn’t make the numbers involved any less remarkable. Over-55s financial specialist Key Retirement has reported this week that pensioner landlords have earned an average of £62,000 over the last seven and a half years. These figures are even higher if we only consider the past 12 months. Over the last year, older landlords have made an average profit of £2,400 a month and now have an estimated total property wealth of £1.054tr.
UK sees drastic fall in homes available to rent
Since 2011 the UK has seen a significant drop in the number of homes available rent in the private sector, with an average fall of 11.6% over that time.
Almost every UK region, including London, has seen a reduction in available private rental stock with only the North East bucking the trend.
This speaks to how much the Private Rented Sector has expanded over the past decade. More people are renting than ever before and landlords can charge a premium for the best accommodation. The unaffordability of homes in the UK will only exacerbate this issue and renting in the long term will remain the only option for many people, especially those under the age of 35.
One month tenancy deposit cap
The Queen’s Speech included a proposed measure to cap the security deposit which tenants will have to pay their landlord at the equivalent of one month’s rent. This fairly transparent attempt from the Conservative Party to appeal to young people by “making the private rental market more affordable and competitive” has caused controversy among landlords but gained support from rent campaign groups.
The National Landlord’s Association has objected on the grounds that this cap will empower tenants to leave at short notice. If the security deposit is capped, then the argument goes that tenants could see it as no more than the last month’s rent and leave landlords in the lurch, forcing them to offer their properties only to better off prospective tenants.
On the other hand, Generation Rent has welcomed this move from the government, arguing that the pendulum has swung too far in favour of landlords’ rights and it is past time that tenants were afforded more security and consideration.
This will be an interesting situation to watch over the coming months and years. With the potential ban on lettings fees already on the table, the rental landscape could well change dramatically in the near future.
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