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The Housing Market in 2016

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According to new research by Martin & Co, the number of private rented sector homes have increased by 135% over the past 30 years.

The Martin & Co report shows there has been a 346% increase in the number of households aged between 35 and 44 in this sector. 71% of households aged between 16 and 24 now live in a privately rented home, in 1986 this was at 32%.

Growth in the past 30 years has been particularly significant with two million new households entering the private rented sector across England alone. The number of private rented properties overtook the social housing sector in 2012.

Over the past two years, 300,000 people have entered the UK and the private rented sector is usually their first option. With near to 2.5 million students in the UK, an increase of 31% since 1995, the increase in students has also contributed to the growth in the sector.

The Mid 90’s saw the introduction of buy to let mortgages which now account for 18% of the mortgage market, with a staggering £338 billion worth of mortgage loans on buy to let properties since the late 1990s.

The property sector has matured into an attractive asset class for investors, outperforming other investments over the past 30 years. Property has grown a staggering 786% in the last three decades, doubling growth seen by shares in the FTSE 100. It’s not just the strong capital growth that adds to the value though, positive rental returns also add to the story.

Reports highlight the private rented sector could grow by as much as 200,000 homes a year over the next five years. Household numbers will continue to grow and the rising house prices will continue to hinder the chances of those prospective buyers looking to climb onto the property ladder. With average first time buyer deposits at £50,000, compared to a mere £4,000 in 1986, it continues to provide yet another barrier to first time buyers.

But for our investors and landlords, we at Silks Investments aim to continue finding you investment opportunities below market value / with yields of 8% or above. For further details on how we can help you contact us now.

 

We at Silks Investments would like to thank you for reading our blogs. We hope they have been helpful and welcome any feedback. We will currently be taking a break from future blog posts and will hopefully return with our next post in early May.