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Housing Shortage - Rents soar to another new record high....
HAMISH_MCTAVISH
Posts: 28,592 Forumite
Average Rent in April now £774 per month, up 4.6% on last year.
Average BTL rental yield now 5.1% and total return including capital growth 8.9% in the last year.
Fastest growing area is the East of England at 12.5% YoY versus London at 7.8% YoY.
Proportion of rent in any arrears, even just a few days, falls to 7% and proportion in serious arrears just 1.8%, well down on where it was just a few years ago.
Well, based on the logic of some on here, the way to tackle rising house prices is to throttle lending so that fewer people can buy. (While conveniently ignoring the fact that this approach also ensures fewer houses are built and so worsens the shortage.)
So, using that same logic, the way to tackle rising rents must be to throttle wage growth so fewer people can afford to rent?
Average BTL rental yield now 5.1% and total return including capital growth 8.9% in the last year.
Fastest growing area is the East of England at 12.5% YoY versus London at 7.8% YoY.
Proportion of rent in any arrears, even just a few days, falls to 7% and proportion in serious arrears just 1.8%, well down on where it was just a few years ago.
http://www.lslps.co.uk/documents/buy_to_let_index_apr15.pdf“Rents are going skywards and still accelerating. That momentum is fuelled by a fundamental shortage of housing and given oxygen by renewed wage growth."
“Economic progress has brought about a slow but steady stream of household earnings and employment: the most basic requirements for rent rises.
Placed in the context of the UK’s pressure-cooker housing shortage, these modest improvements have driven rents up at record speed.
“This should be a loud and clear signal to the authorities that home building is more than just manifesto-fodder. People have more money in their pockets, but we’re in danger of seeing that recovery squandered away on a housing shortage.
With the surprise of a relatively strong majority government, there has never been a better time to take the bull by the horns and fix this housing crisis at the root.
When you hear a kettle whistle, you take it off the hob.”
Well, based on the logic of some on here, the way to tackle rising house prices is to throttle lending so that fewer people can buy. (While conveniently ignoring the fact that this approach also ensures fewer houses are built and so worsens the shortage.)
So, using that same logic, the way to tackle rising rents must be to throttle wage growth so fewer people can afford to rent?
“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”
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Comments
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I suspect Labour will go into the next election offering rent controls as the solution. <stupid people smilie>0
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İ wonder how this pans out against pension.v buy to let returns?...people who can draw down must be equating the two!mfw'11 No68- 55k mortgage İO--little to nothing saved! i must do better.0
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I suspect Labour will go into the next election offering rent controls as the solution. <stupid people smilie>
After such a humiliating performance in this election, even Labour should be able to learn a lesson, move to the centre, and not make the mistake of offering any more economically illiterate ideas like rent controls.
But then again it is Labour, so who knows....“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »After such a humiliating performance in this election, even Labour should be able to learn a lesson, move to the centre, and not make the mistake of offering any more economically illiterate ideas like rent controls.
But then again it is Labour, so who knows....
Labour are, I suspect, yesterday's news. Too left for England and too right for Scotland.
They'll struggle to win the UK without Scotland and can't win the UK without England.0 -
HAMISH_MCTAVISH wrote: »After such a humiliating performance in this election, even Labour should be able to learn a lesson, move to the centre, and not make the mistake of offering any more economically illiterate ideas like rent controls.
But then again it is Labour, so who knows....
I reckon by 2025 even Boris will be tempted to usher in rent controls. It will become too politically advantageous not to consider it by then. Even Churchill resided over a housing policy with rent controls as one part of the solution ...Proudly voted remain. A global union of countries is the only way to commit global capital to the rule of law.0 -
I reckon by 2025 even Boris will be tempted to usher in rent controls.
The lengths some people will go to avoid building enough houses never ceases to amaze me, so I suppose you never know.....“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
Labour are, I suspect, yesterday's news. Too left for England and too right for Scotland.
They'll struggle to win the UK without Scotland and can't win the UK without England.
It depends what happens over the next 5 years. Many people voted Tory who are floating voters were under the impression that Cameron and Osborne are fixing the economy and it was too early to risk a change.
I havent met anyone who thought Milliband was too left wing. Some of his policies were interventionist and a bit half baked (like mansion taxes) but they weren't especially socialist. The only socialist political messages the English public were exposed to during the election were from Nicola Sturgeon in the leaders debate.
I suspect if she had been standing where Mlliband had been and there had been a vote right after, without a Murdoch smear campaign having time to get started (remember the Tory press scrambling around trying to find a coherent anti-Clegg message last time) , then things might have been a bit different for Labour and the UK.
But Labour would never let anyone like Sturgeon near a leadership role any more, so yes, they probably will end up being Tory lite from now on.0 -
Labour are, I suspect, yesterday's news. Too left for England and too right for Scotland.
They'll struggle to win the UK without Scotland and can't win the UK without England.
Arise the Northern party !
A party mobilising nationalist sentiment from Scotland coupled with the North of England ( a collection of paupervilles ).
This is the best route for Queen Nicola the Sturge to build her power base; she just doesn't know it yet.0 -
If we accept that rents are only going one way, then does this mean we have to plan for a Housing Benefit bill increasing significantly from the £30bn or so it is now?
At what point does this become a significant economic burden?0 -
If we accept that rents are only going one way, then does this mean we have to plan for a Housing Benefit bill increasing significantly from the £30bn or so it is now?
No it doesn't necessarily follow that just because average rents are rising, that HB tenants rents are rising.
We can force them to move down market by reducing their HB or make them share til they're 50 rather than 35.
I'm not saying those are good ideas BTS - just saying it doesn't follow automatically.0
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