What does the UK housing backlog mean for the buy-to-let market?

The UK is currently experiencing a massive backlog when it comes to getting properties with planning permission actually built.

According to the Local Government Housing Association (LGA), there are currently around one million homes in the UK with planning permission that are yet to be built. What exactly is causing this backlog?

What does the UK housing backlog mean for the buy-to-let market?

Well, since 2009/10 over 2.5 million units have been granted planning permission by councils, yet only 1.5 million have completed. The number granted for new homes have doubled since 2012/13, with councils approving 90 percent of applications, however they are struggling to keep up with the ever-growing housing demand. Completions have only increased by half as much in that time, and even though the completions last year were the highest in any decade, it is clear to see that the UK’s housing backlog is posing a real issue at the moment.

David Renard, housing spokesman for the LGA, said: “The planning system is not a barrier to housebuilding. The number of homes granted planning permission has far outpaced the number of homes being built.

“No one can live in a planning permission, or a half-built house where work on a site has begun but not been completed. Councils need powers to tackle our housing backlog and step in where a site with planning permission lies dormant and housebuilding has stalled. If we are to solve our housing shortage, councils need to be able to get building again and resume their role as major builders of affordable homes.”

But what does this mean for the buy-to-let market? Well, with the mass amount of unbuilt homes in the UK, more and more people are being forced to continue to rent. Rental demand reached a record high in January of this year, up an estimated 57% from the year prior according to ARLA Propertymark. Despite the massive increase in rental demand, there continues to be a shortage of supply on the market.

The widening supply-demand imbalance paired with the aforementioned housing backlog is resulting in a staggering increase in rents across the country. The number of letting agents who witnesses increased rents in January came to 42%, a massive 10% increase compared to 32% just a month before.

Whilst increased rents and a lack of supply isn’t great news for those renting, it does make for an extremely lucrative investment opportunity for buy-to-let investors. Throughout the past few years, the buy-to-let market has been one of the most stable investment options on the market, and saw a massive boost entering 2020 after the General Election.

The forecast for the coming years is extremely promising for buy-to-let, with the market expected to continue its upward trajectory throughout the year and beyond, and despite the current coronavirus pandemic sweeping the world, buy-to-let remains a great investment choice. The property market is one of the only markets not to completely plummet in the midst of the virus, and with an increased tenant demand and a massive housing backlog, it offers a fantastic opportunity for potential investors.

Are you interested in investing in buy-to-let property? Here at Knight Knox we make property investment simple, browse through some of our latest buy-to-let developments here.

Preston Guide vertical - April 2019

Get in touch

By submitting your details you consent to being contacted by Knight Knox and/or our sister company yieldit, by telephone and email for this and similar marketing material.


4.7 Customer rating on Google Reviews - A Ellis

"Helped us all the way through the process"


4.7 Customer rating on Google Reviews - A McConnell

"No hard sell, just simple easy to understand information"


4.7 Customer rating on Google Reviews - D Baldwin

" I was so pleased with the annual returns of this investment that I subsequently bought 3 more properties"