Private Renting in England: A Shift in Demographics
The latest report from The Mortgage Works highlights a significant shift in the demographics of private renting in England. According to the report, there has been an 80% surge in the number of people renting aged between 55-64 over the last decade. This trend is in stark contrast to the continuous drop in homeownership rates amongst this age group, which is now 10% lower than its 2007 peak.
London led the rise in private renting across England
The report reveals that London has led the way in private renting, with close to one in three (30%) households opting to rent privately in the capital, nearly double the rest of England. This is likely due to high house prices and higher mortgage costs, making it difficult for people to get on the property ladder.
“Understanding the dynamics of the private rented sector has never been so important. The sector continues to support the lives of millions of people across the UK by providing homes for those who either can’t afford to buy or prefer not to own a home.” - Damian Thompson, Director of Landlord at The Mortgage Works
The report also highlights the rapid growth of professional landlords, with the proportion of landlords owning five or more properties more than tripling from 5% in 2010 to 18% in 2021. These landlords wield substantial influence, commanding almost half of all tenancies.
Around 350,000 buy-to-let fixed-rate mortgages set to mature in the next year
With around 350,000 buy-to-let fixed-rate mortgages set to mature in the next year, those refinancing face potential payment shocks of around £225 per month, potentially impacting rental market dynamics. This, combined with the high demand for rentals amid dwindling supply and barriers to prospective first-time buyers, has led to unprecedented annual rental growth in recent years.
A Call to Action
The new government has pledged to address the housing crisis, and The Mortgage Works report provides a valuable insight into the private rented sector. As the UK’s housing composition continues to evolve, it is essential that we understand the dynamics of the sector and work towards creating a stronger, fairer private rented sector that works for both landlords and tenants.
