There is a distinct smell of change in the air. For many years, as a nation, we were told that there was nothing as safe as bricks and mortar. Maggie Thatcher encouraged millions to buy their own homes. Renting was ‘dead money’.
Of course the fluctuations in the property market have seen record numbers of people either lose their homes or see an equity wiped away.
Many people didn’t figure on having to move as employment patterns changed. When you own a property that flexibility of moving is not quite the same. We seemed to have developed a stigma about renting. Although other European countries didn’t.
In 2003 we reached 70.9% home ownership, today that has shrunk back to 66%. 10.1% rented from private landlords in 2001 – today that is 16.5%. It is becoming less of an issue to rent – especially for young people who simply can’t raise a deposit.
Back in August The Montague report was published by the Government – that was a root and branch look at the private rented sector. In his introduction, Sir Adrian Montague said, “It’s clear we must encourage investment in the private rented sector, which has gone through a period of rapid growth and is now relied upon by millions of people. My review shows that the rental housing sector offers potential investment opportunities of interest to institutional investors. But real momentum has been inhibited by constraints affecting the supply of stock, the treatment of rented housing schemes under the planning system and the need to create confidence among investors.“
In response to the recommendations of the Montague report, the Build to Rent Fund has now been launched to stimulate new private rented housing supply and to provide opportunities for new institutional investment in the sector. It’s a £200m fund to kick-start investment.
As such it should be applauded. I’m involved in two schemes at the moment and I can see that this ‘new’ sector is long overdue.