Main issues in the rental crisis remain largely unaddressed, it's claimed
New data from Cornerstone Tax, a UK group of property tax experts, found that, over the past two years, almost one in five tenants across the UK has lost out on a property they wanted to rent due to a bidding war.
The rental market continues to experience a decline in supply as more landlords are considering or have exited the market amid elevated mortgage rates and high taxes. As a result, bidding wars among prospective tenants have become commonplace.
The new figures demonstrate a divide between tenants in the North and in the South across the UK. In London 25% have missed out, in Southampton, 28%, in Manchester, 20%, in Leeds, 15%, and in Newcastle, 10%.
David Hannah (pictured), group chairman of Cornerstone Tax, said measures should be taken to help more young people get on the property ladder, reasoning that the reason for such disparities could be the exit of landlords from the South to the North of England due to lower property prices in the North, as well as the region’s inclusion in the government’s Levelling Up Scheme. New data from the Office of National Statistics show the North East has seen the highest annual house prices percentage change of all English regions in the last 12 months to September 2023 at 1.6%, while the South West saw the lowest at -1.6%.
"Our data highlights a clear issue in the UK's rental market,” said Hannah. “Many of these landlords took out mortgages on buy-to-let schemes during a period of sustained low interest rates; fast forward to 2023 and the pressure currently facing landlords is simply too much. Spiralling interest rates and the highest tax burden since the second world war have forced thousands of landlords to sell up, which then puts further pressure on renters due to a lack of stock
"We are generally seeing an exodus of landlords from the capital and South East, looking towards the North East of England instead. It's a region that's seen the highest growth in property prices in the last twelve months, with many seeing it as a much safer investment than the capital."
Hannah said despite the government stating an intention in its autumn statement to unfreeze the local housing allowance (LHA), the root cause of the crisis in the market remained largely unaddressed.
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