The lender has predicted that the market will grow from £14.7 billion to £20.6 billion in 2010.
CHL has highlighted government statistics that predict a 1.6 million increase in the number of households by 2010. This contrasts with predicted shortfall of 520,000 dwellings by 2010, according to the National Housebuilders’ Federation.
Bob Young, sales and marketing director at Capital Home Loans, said: “Demographics simply do not lie. There is a shortfall of 65,000 dwellings per annum for each of the next eight years. That is a cumulative shortfall of 520,000 dwellings. People will want to live somewhere and if they can’t buy then they will rent.”
“To say that there is a bubble waiting to burst is way off the mark. It may be the case that some investors are buying rental property in the wrong place and at the wrong price and are consequently finding it difficult to achieve the rents they want, but what comes through loud and clear is that if you buy a decent property in an area that will rent you will do very well.
“As the supply of property is going to tighten, rents will stabilise and then increase. It is simple supply and demand. Budding landlords should not be concerned about the negative publicity. If they approach renting in a methodical way and plan it carefully, they will do very well from what has proved to be - and will continue to be - a low-cost, very high-return investment.”
