Date Published 20 June 2013
Monthly rents will hit an average of £800 in England and Wales in two years’ time, while one in five people will be living in private rented accommodation.
The claims came from Lucy Jones, operations director at LSL, speaking yesterday at a Council of Mortgage Lenders conference.
She said the rise would represent a 21% hike since 2010.
She said: `While economic expectations have changed, and even as rents in many areas have risen rapidly, the private rented sector has actually been surprisingly stable.
`Meanwhile, the purchase market has resembled a broken rollercoaster.
`First-time buyers have seen a boost from new government schemes this year, but the ability to raise any deposit at all has been severely reduced by the recession. As house prices accelerate, this long-term trend towards renting will continue.`
She went on: `Whatever the regulatory outlook, the economic fundamentals will remain the same. Landlords will be critical in providing more homes for million of people who are no longer able to buy. Not just rents will rise.
`Gross yields are set to increase, too, and that should encourage investment from landlords – but they will need finance to continue to keep pace with such demand.
`More finance can allow more homes, and that’s slowly happening. Buy-to-let advances are growing gradually, at what should prove a sustainable rate. And long may that continue. This year, buy-to-let looks set to return to the same proportion of mortgage lending as it was in 2007.
`The private rented sector is set to flourish in the recovery, if anything more vigorously than its performance in the recession.`