The affordable housing shortage

It was inevitable. A spiral of closures in the hospitality industry that equates to one closure every hour in the third quarter of 2022, according to The Caterer magazine. And now we are in the last quarter of the year, reeling even further from energy price rises, inflation, interest and mortgage rate rises, it’s going to get worse, for sure. When the cost of living goes up too much, life’s little luxuries such as going out for a drink, or a meal, or ordering a takeaway, are first to be chopped off the expenditure list.

And the residential sector is no better. According to research by the Association of Registered Letting Agents, April saw the highest number of private landlords sellinAffordableg their buy-to-let properties since records began. Five landlords exited the market in April, for each estate agency branch surveyed.?

I was at the Finance Professional Show just a couple of weeks ago and all around me people were discussing how mortgage and interest rate rises were impacting on the property sector, especially private landlords leaving the PRS. Not necessarily selling all their properties, just a few, mainly to help balance the books.

It’s not just interest and mortgage rate rises causing this problem in the PRS, the supply of rental accommodation is being impacted by increasing regulatory costs for landlords, and tax changes which make buy-to-let properties more expensive for individual landlords to run. Compliance with further HMO rules will also cost landlords thousands of pounds. Furthermore, landlords will soon be unable to claim mortgage interest payments as a tax-deductible cost when considering their portfolios.

So, the rental sector is being hammered but what about property sales? No good news there either. Zoopla has reported a flagging home sales — down 28% compared with October 2021, and on a par with pre-Pandemic figures. The drop in sales has been driven largely by rising mortgage rates and this autumn, buyer demand has decreased by a staggering 44%. At the same time, Zoopla reports, housing stock has been increasing. In the four weeks to 20 November 2022, 40% more properties were added to Zoopla than during the same period in 2021. With supply outstripping demand, 25% of the properties sold on Zoopla since September 2022 have had their asking price lowered, with 11% having their asking price reduced by at least 5%.

It's all depressing and dire news for those seeking affordable housing. A lot of homeowners are obviously desperate to shift their properties as they find themselves struggling with higher and now unaffordable mortgages, even if the market does seemed to have calmed down a bit, but the shortage of rental properties is leading to rising rents and exacerbating the general increase in the cost of living everyone is experiencing.

We are now inundated with people wanting to join our list of property guardians – working people desperate to find a home which they can afford, in return for safeguarding the building from vandalism, squatters and all the other problems an empty property attracts. They are struggling with rising rents in the private sector, especially in city centres, and are happy to look after a property if it gives them an affordable roof over their head, no matter if it is an empty fish and chip shop or former pub.

There are a lot of lawless and destructive people out there, they always seem to proliferate in difficult economic times, and property vandalism and theft?is increasing. Don’t let your property suffer and discover it stripped of copper piping and wiring, or roof tiles, or anything else that can be sold as scrap, or even used as a dump for flytippers.?

Give my office a ring and let us secure your vacant property and give someone a home this winter. It won’t cost you anything (we’ll take charge of making it suitable to be lived in temporarily) but it will make someone very grateful to you and is a truly sustainable solution to a growing problem.