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Help to Buy will definitely have some impact on rental demand, says LSL
Help to Buy will “definitely have some impact” on the private rented sector.
The claim comes from David Brown, commercial director at LSL, who said that the scheme, combined with a healthier economy and recovering mortgage market, will help some tenants get on the housing ladder.
But, he went on: “Even if the growing backlog of aspiring home owners can be offered enough help, there are more and more joining their ranks every year.
“For many households, even a 5% deposit is a struggle. So for the time being at least, the rental market is more realistic – and more immediately affordable – for millions.”
Meanwhile, separate new research has shown that just over one in five private landlords is concerned that the second phase of Help to Buy will reduce tenant demand.
The research from the National Landlords Association has found that 21% are concerned about the impact the scheme will have on the private rented sector, with 15% expressing concern for their own lettings businesses.
More than 2,000 mortgage offers have been made using the Government’s new home ownership initiative, supporting £36m worth of mortgages. This has caused concern among some that the scheme might affect demand for private rented properties.
Richard Lambert, CEO at the NLA, said: “Much of the debate around Help to Buy is currently centred on the whether the scheme will create another housing bubble.
“However, this conversation is itself driven by the much bigger issue at hand: the fact that there are simply not enough homes for people, regardless of whether they want to rent or buy.
“While this is still the case the private rented sector will play a vital role in meeting housing demand, and in the medium, if not long, term it is likely that renting for longer periods will become a normal part of our housing biographies.
“As such, the priority for the NLA is to ensure that rented homes are both enjoyable places to live and viable places to invest.”
