I was having a most interesting chat the other day with a
Warminster landlord when we were looking at a property. As I am sure you are
aware, I am always happy to cast my eye over any potential buy to let purchase
in Warminster, be that you emailing me a Rightmove link, a brochure in the post
or even treading the carpet and seeing it together. I don't charge for that,
and you don't even need to be a client of mine. We got talking about the
Warminster Property Market and this landlord brought up the subject of a report
he had read from the Royal Institution of Chartered Surveyors (RICS) and
PricewaterhouseCoopers (PwC) that stated almost 1.8m new rental homes are
needed by 2025 to keep up with current demand from tenants. He wanted to know
what this meant for Warminster.
Well my blog reading friends, some commentators said last
Winter that buy to let was about to die, what with the new stamp duty changes
and how mortgage tax relief will be calculated. Others even said 500,000 rental
properties would flood the market nationally in the 12 months after the new
Stamp Duty rules came into force on the 1st April 2016 as landlords left the
rental market. Well, all I can say is, I wish all the landlords of those half a
million properties would hurry up and put them on the market – because I have
plenty of other potential landlords wanting to buy them!
Back to the matter in hand.. if the RICS and PwC are indeed
correct, what does this mean for Warminster? The fact is, as a country, we are
facing a precarious rental shortage and need to get building in a way that
benefits a cross-section of society, not just the fortunate few. I call on the
Prime Minister to drop the higher stamp duty tax on buy to let purchases to
ease the pressure on the rental market.
Of the 7,500 households in Warminster, currently 3,700
tenants live in 1,500 private rented properties. If we apportion those 1.8m
households equally around the Country, that means in nine years’ time, the
number of rental properties in Warminster needs to rise by 600 (i.e. 42.8%) ..
taking the total number of rented properties to 2,100.
That means Warminster landlords need to buy around 70
properties a year between now and 2025 to meet that demand – because according
to my calculations, an additional 1,600 people will want to live in all those
'additional' Warminster rental properties – so why is the government penalising
landlords?
Thankfully the new housing minister Gavin Barwell detached
Teresa May's new administration from the Cameron/Osborne laser-like focus of just
home ownership to solve our housing issues, saying "we need to build more
homes for every single type of person needing a home and not focus on one
single tenure". The private rented sector became a stooge under David
Cameron's watch and still, with increasingly unaffordable Warminster house
prices, the majority of new Warminster households will be relying on the rental
sector in the future to house them. I can only say Westminster must put in
place the measures that will allow the rental sector to flourish. Any
restrictions on the supply of rental property will push up rents (bad news for
tenants), thus side-lining those members of Warminster society who are already
struggling. Let's hope this new Government continues to see the contribution
landlords give to the country as a whole.
