PM confirms rising demand for rental homes
Property portfolios held by landlords in London will continue delivering yields well above many other investments, according to two high-profile sources.
A London Housing Commission report published in the first week of the New Year by influential think-tank the Institute for Public Policy Research, found that the average property in the capital now costs 10 times the average salary.
It says 500,000 houses need to be built in London over the next decade, but adds that only 194,000 homes have been built in the capital over the past 10 years.
The research reveals a number of key statistics, including the fact that rents paid by tenants have risen 16% over the past five years.
London Housing Commission chair Lord Bob Kerslake comments: “The idea of home ownership is becoming more and more out of reach of ordinary Londoners.”
IPPR senior research fellow Bill Davies adds: “Left alone, the market will not deliver the homes the capital needs.”
In the same week that the London Housing Commission’s findings were made public, Prime Minister David Cameron announced plans to directly commission the building of more than 13,000 new homes on five publicly-owned sites in London and south-east England.
The move is part of what has been described as a “radical new policy shift” to build more homes on brownfield sites up and down the country.
In his New Year message, the Prime Minister said he would “kick-start the building of thousands of homes in a return to 1980s-style projects like the Docklands development”.
“Nothing like this has been done on this scale in three decades – government rolling its sleeves up and directly getting homes built.”
The government has also committed £1.2bn to help developers detoxify brownfield land so it can be used for house building.
This will allow 60,000 more homes to be built over the next five years, according to the government. Of those, half will be affordable starter homes.
The first wave of directly-commissioned homes will see about 3000 properties built on Old Oak Common – 950 hectares of brownfield land between Harlesden and East Acton.
While Assetgrove welcomes this attempt to help provide London’s 8.6 million residents with homes of their own, it is disappointing that other schemes will see houses built outside the M25 in Kent, West Sussex, Hampshire and Cambridgeshire.
This is one of the reasons why London’s landlords will play an increasingly important role for many years to come.
However, we recognise that the increasingly intrusive and complex legislation being passed by governments – which now includes fines of up to £3000 if a landlord fails to confirm a tenant has the right to live in the UK – places an unfair bureaucratic and legal burden on London’s landlords.
Since being set up in 1975, Assetgrove has worked with landlords to help generate the maximum rental income on their property.
That is why we offer a rent guarantee scheme that allows landlords to receive a fixed monthly income while we get on with the business of handling all the day-to-day tasks of managing a property portfolio, such as inspections, lettings, viewings, maintenance and legal issues.
Whether you let out a single property or a large portfolio of rental homes, Assetgrove’s rent guarantee scheme can take the hassle out of managing tenants. For more information about our services for landlords, contact Assetgrove today.