If an Englishman’s home is his castle, then the castle increasingly belongs to someone else. As house prices spiral out of reach, people are spending longer and longer in rental accommodation. A tenant’s loss is a landlord’s gain, however, meaning supply and demand fundamentals are firmly baked into the market.
Tip style
Growth
Risk rating
Medium
Timescale
Medium Term
Bull points
- Strong market fundamentals
- Regulatory tailwinds
- Shareholder rebellion could lead to change
Bear points
- Lengthy investment management contract
- Expensive debt
At the same time, successive governments have made it more difficult for individuals to gain exposure to the private rental market by reducing the tax relief and increasing obligations. This has resulted in a loss of properties from this part of the market, which has pushed rents up further.