One million more households to rent by 2018
More than a million households will move into rented accommodation over the next five years, says Savills
More than a million households are expected to join the UK’s growing army of tenants over the next five years, despite government efforts to boost home ownership.
Property group Savills, which released its five year forecasts for house prices on Wednesday, said UK rents will also rise by 21pc over the next five years.
London rents are expected to increase by 25.8pc by 2018, outpacing the forecast growth of house prices in the capital, which Savills expects to increase by 24.4pc.
Lucian Cook, head of UK residential research at Savills, said that the government’s Help to Buy scheme, intended to help households with small deposits buy a property, might help some renters to access home ownership but its impact on rental demand will be “limited”.
“We anticipate that the major beneficiaries of any increase in net lending are likely to be exisiting home owners,” he said. “Its impact on rapidly rising rental demand will be limited, most notably in London where almost 26pc of households currently live in the private rented sector.”
By 2018, 5.8m households will be in rented accommodation, Savills said, up from 4.8m this year. The number of homeowners is predicted to fall slightly from 17.7m to 17.4m over the same period.
The private rented sector across the UK grew by two million households in the ten years to 2011, with the sharpest growth seen since 2007 as the credit crisis dried up lending to would-be buyers.
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