The medium to long term outlook is likely to be positive for the private rental market. It will undoubtedly get more challenging for people to get on the housing ladder over the next few months and years.
As the furlough scheme unwinds, there will inevitably be more redundancies and people will find it harder to move home; this will clearly increase the demand for homes to rent.
As lockdown lifts we may also see a rise in the divorce rate if the UK follows the pattern of many of the other countries coming out of lockdown.
This will also drive people to move home, not all of whom will either be able to afford one or get the mortgage that accompanies it. This will also drive demand in the buy-to-let space.
Short term consequences
But it will be a mixed view for landlords in the short term. Students will not go to university in September in the volumes that they did before, with many postponing their places for a year and some courses going online, this may well lead to a dip in demand for rentals in student towns.
On the other hand, professional working people who can no longer afford to get a single flat or house to rent, may well look to houses in multiple occupation as a more affordable housing option over the next year.
Other differences we could well see is a change in use of city centre premises. It seems unlikely that all the companies that have operated from city centre offices will continue to do so. As home working has become a way of life some firms, such as Twitter,which has announced that it will allow employees to work from home forever.
With the PM’s ‘build, build, build’ speech also revealing that commercial premises can now be converted to residential without planning permission, property investors will seek to take advantage of this. Premium city centre sites could well become desirable new living accommodation.
The fact that this government is recognising the housing shortages, that we have all been talking about for decades, has to be good news if it is followed up with the promised relaxation of the planning laws.
This should help not only those wanting their own home but also landlords and investors while providing far more accommodation in the private rental market.