After George Osborne announced his plans to help the housing industry during the Budget last month many of those that work in the private rented sector claimed that his efforts may not be enough as he focussed too much on helping people in the UK buy a home and not enough on the struggling private rented sector. Currently, a huge amount of the population now rents their home as so many can no longer afford to save up for a deposit for a mortgage. Furthermore, as house prices are so low many people no longer see their home as a form of investment, meaning that renting has become more and more popular.
However, those working in the private rented sector will be happy to hear that the government is planning on investing heavily in new properties specifically to be let out as private accommodations, which has led to a large amount of housing associations already planning on expanding their private property portfolios. For example, last week alone ten housing sectors decided to take part in the government’s scheme to create more private rented accommodation and each use some of the £700 million the government put aside to invest in new developments.
Furthermore, some housing associations have even announced that they will be using their own funds to create new housing, such as Guinness Partnership who has announced that they plan to build one thousand new private rented accommodations over the next three years, while Catalyst Housing also stated they expect to create the same amount in five. Meanwhile, the Notting Hill Trust will use £33.1 million of the government’s fund in order to quadruple its private rented sector offerings within the next five years. The Trust already owns 25,000 homes in the London area, and over the next five years is planning on creating two thousand more.
Discussing the new developments, development director John Hughes from the Notting Hill Trust said: “It’s a good area to invest in, both in terms of servicing a client group and as a commercial investment.” Landlords who already work in the private rented sector will be happy to hear that more housing will soon be available and that the market will therefore become less risky, meaning that they won’t have to rely so heavily on their landlord insurance or turn away potential tenants due to lack of housing.