The monthly magazine providing news analysis and professional research for the discerning private investor/landlord

The Benefits of The PRS

A new report by the National Landlords Association (NLA) assesses the benefits of the private rental sector (PRS) and the role that landlords play. Below is a brief summary of the 15-page report.

Criticisms of landlords explored
Private renting now accounts for 22% of households in the UK as a whole, and almost half of households in some densely populated London boroughs. It is the second most popular housing tenure, behind owner-occupation but ahead of social housing, and therefore attracts criticism.

Criticism #1: Landlord profit equals tenant loss
The common assumption is that the pursuit of maximum profit will see corners cut and demand ruthlessly exploited by landlords. The evidence put forward to support this claim is that rents are rising whilst the quality of privately rented housing is poor.

However, the NLA says there is very little empirical evidence to support these arguments and data from the ONS (Office for National Statistics) shows that rent levels in the UK increased by 6.8% during the period January 2015 to October 2018. During the same period, the CPI (Consumer Price Index) increased by 6.9%.

The report adds: “If we look a little further back, using 2005 as a base for comparison, private rents fell on average across Great Britain by 4% (compared to inflation).” The NLA says that the disparity occurs because rents are often viewed in isolation to inflation.

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