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Buy-to-Let Demand to Surge as Young People Struggle to Get on Property Ladder
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
Buy-to-Let Demand to Surge as Young People Struggle to Get on Property Ladder
Buy-to-let demand is set to surge with each new generation, as homeownership levels drop significantly, according to a new report.
Less than half of those born in 1990 will own their own home by the age of 40, says the study from Savills.
The Residential Property Focus 2015 by Savills found that 53% of those born in 1960 owned their own home by the age of 30, increasing to 71% by the age of 40 and 79% by the age of 50.
Of those born in 1980, only 35% owned their own home by the age of 30. This is expected to fall to 26% for those born in 1990.
By the age of 40, most of this generation will live in private rental accommodation, with just 47% expected to own a property.
The Managing Director of Surrenden Invest, a specialist buy-to-let consultancy, Jonathan Stephens, says the data is good news for landlords.
He explains: “Quite simply, falling rates of homeownership mean rising rates of renters, so the growing situation in the UK creates a substantial opportunity for those looking to make their money work for them by investing in residential real estate.
“Of course, alongside this it is important to remember that the area in which you invest is important too – a few miles difference, particularly in major cities like London, Manchester and Liverpool, can have a big impact on yields.”1
He adds that this is particularly true in the capital. House prices are forecast to rise by 21.5% in central London and by 18.2% in outer London over the next five years, says Savills.
1 https://www.landlordtoday.co.uk/breaking-news/2015/11/buy-to-let-demand-will-continue-to-soar
