We got talking about the Aylesbury Property Market and this landlord brought up the subject of a report she had read from the Royal Institution of Chartered Surveyors (RICS) and PricewaterhouseCoopers (PwC) that stated almost 1.8m new rental homes are needed by 2025 to keep up with current demand from tenants. She wanted to know what this meant for Aylesbury.
Well, some commentators said last Winter that buy to let was about to die, what with the new stamp duty changes and how mortgage tax relief will be calculated. Others even said 500,000 rental properties would flood the market nationally in the 12 months after the new Stamp Duty rules came into force on the 1st April 2016 as landlords left the rental market. Well, I wish all the landlords of those half a million properties would hurry up and put them on the market – because I have plenty of other landlords wanting to buy them!
Back to the matter in hand.. if the RICS and PwC are indeed correct, what does this mean for Aylesbury? The fact is, as a country, we are facing a precarious rental shortage and need to get Aylesbury building in a way that benefits a cross-section of Aylesbury society, not just the fortunate few. This government should drop the higher stamp duty tax on buy to let purchases to ease the pressure on the rental market.
Of the 28,900 households in Aylesbury, currently 11,200 tenants live in 4,700 private rented properties. If we apportion those 1.8m households equally around the Country, that means in nine years’ time, the number of rental properties in Aylesbury needs to rise by 2,000 (i.e. 42.8%) .. taking the total number of rented properties in the town to 6,700.
That means Aylesbury landlords need to buy around 200 properties a year every year between now and 2025 to meet that demand – because , an additional 4,800 people will want to live in all those 'additional' Aylesbury rental properties – so why is the government penalising landlords?
Thankfully the new housing minister Gavin Barwell detached Teresa May's new administration from the Cameron/Osborne focus of just home ownership to solve our housing issues, saying "we need to build more homes for every single type of person needing a home and not focus on one single tenure". The private rented sector became a stooge under David Cameron's watch and still, with increasingly unaffordable Aylesbury house prices, the majority of new Aylesbury households will be relying on the rental sector in the future to house them. Westminster must put in place the measures that will allow the rental sector to flourish. Any restrictions on the supply of rental property will push up rents (bad news for tenants), thus side-lining those members of Aylesbury society who are already struggling. Let's hope this new Government continues to see the contribution landlords give to the country as a whole.
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