The most recent data from the English Housing Survey revealed the number of privately rented households has doubled over the past 16 years, from 2 million in 2000 to 4.5 million in 2015/16.
Are more people renting?
There is a definite shift in attitude toward renting property in Central London and, I believe, the UK in general. With the uncertainty of Brexit and a lack of faith in our overall economic state as a country it would seem that potential home owners are currently really struggling to find a reason to buy.
In London the sales market has really been reduced to a “births, deaths and marriages” market of buying through absolute necessity rather than for investment. If we combine this with mortgage criteria getting tougher and tougher in the last 10 years and a whopping increase in stamp duty, the incentives that existed 10-15 years ago to buy a home have all but disappeared.
Regardless of a loss of appetite, most people have also completely lost the ability to buy a property because of the amount of upfront cash that they would have to find to make a sale happen. I think by now it is clear to most people that there is a solid shift in the overall property market to far more people renting than buying.
How long will this trend last?
It could be for just a few years. Brexit might sort itself out and seem like a storm in a political teacup, punitive stamp duty may be reformed and borrowing may get easier. But I cannot see this being likely.
I am strongly of the view that a combination of a lack of choice and tougher overall market will lead to a generation of people choosing to stop worrying about paying for their retirement and focus on renting a home that they actually enjoy living in. It may mean that much more ‘preparing for retirement’ cash gets invested in pensions and shares again with UK property taking a much needed break.
How can landlords improve the renting experience for tenants?
Some landlords may improve the renting experience for tenants by running their tenancy like a business, with a greater degree of professionalism and care. In my field I meet some incredible landlords who have the ability to switch off the personal side of letting and focus more on ensuring that the actual product that they are presenting is clean, functioning well and in good order before their tenant moves in.
Many of our clients that ‘really nail it’ will properly introduce themselves to their tenants formally and in writing, setting out their hours of business and what to do if something goes wrong.
In my experience it is vital that landlords who wish to manage their own property really step up and take control if the overall narrative of the tenancy. Be prepared for things to go wrong and run through scenarios of ‘what to do if’. If a landlord combines preparedness with the ability to set (and respect) personal boundaries by keeping their relationship with their tenants one of professionalism and efficiency things tends to run from beginning to end much more smoothly.