Tenant Demand on the Up
A report from Paragon Mortgages said that tenant demand rose in Q3 of 2015.
A survey of 2,000 landlords said that 41% noted a demand increase.
The Paragon Mortgages report also measured average rental yields across the country in Q3 at 5.6pc.
Landlords in Yorkshire and the Humber reported highest yields of 6.1pc, while London landlords noted 4.8pc. This may explain why the commuter belt in outer London has registered the second largest increase in tenant demand.
Home ownership just keeps on sliding
In 2003, 71pc of households were owned by their residents.
Today, that number has fallen just below 63pc. In London, it is below 50pc.
Renting is a necessity for the younger generations – 36pc of households are privately owned, leaving everyone else to rent.
And only a quarter will own a home by 2025
Only 26pc of generation rent (20-39yr olds) will own their own home.
PwC pointed out that 38pc had brought a house in 2013.
Meanwhile, 59pc of generation rent will be in private rental accommodation, up from 45pc in 2013.
Starter homes in London are being capped at £450,000, and £250,000 elsewhere.
A typical required income to be able to afford a purchase is £50,000, almost double the national average salary.
Interest rates to hold steady?
One of the key factors that affects the market is the interest rate. Homeowners with mortgages rely on them and they also change spending and saving habits across all walks of life.
Last month, the Bank of England voted 8-to-1 to hold the current interest rate of 0.5pc, which has stayed constant since March 2009.
The Bank released a batch of economic forecasts that suggests the rate may hold until early 2017, in spite of rumours that an increase was going to take place in summer of this year.
The economy has slowed its growth throughout the year and wage increases and inflation are below target – until inflation steadies, interest rates won’t change.