I was having a most interesting chat the other day with a Walsall landlord when we were looking at a property he was thinking of buying. As I am sure you are aware, I am always happy to cast my eye over any potential buy-to-let purchase in Walsall, be that you emailing me a Rightmove/ Zoopla link, a brochure in the post or even treading the carpet and seeing it together. I don’t charge for that, and you don’t even need to be a client of mine.
We got talking about the Walsall Property Market and this landlord brought up the subject of a report he had read that stated almost 1.8m new rental homes are needed by 2025 to keep up with current demand from tenants. He wanted to know what this meant for Walsall.
Well my blog reading friends, some commentators said last winter that buy-to-let was about to die, what with the new stamp duty changes and how mortgage tax relief will be calculated. Others even said 500,000 rental properties would flood the market nationally in the 12 months after the new Stamp Duty rules came into force on the 1st April 2016 as landlords left the rental market. Well, all I can say is, I wish all the landlords of those half a million properties would hurry up and put them on the market – because I have plenty of other potential landlords wanting to buy them!
Back to the matter in hand.. if the report from the Royal Institute of Chartered Surveyors is correct, what does this mean for Walsall?
The fact is, as a country, we are facing a precarious rental shortage and need to get Walsall building in a way that benefits a cross-section of Walsall society, not just the fortunate few. I call on the Prime Minister to drop the higher stamp duty tax on buy-to-let purchases to ease the pressure on the rental market.
Of the 107,800 households in Walsall, currently 32,500 tenants live in 12,600 private rented properties. If we apportion those 1.8m households equally around the Country, that means in eight years’ time, the number of rental properties in Walsall needs to rise by 5,400 (i.e. 42.8%) .. taking the total number of rented properties in the town to 18,000.
This means that Walsall landlords need to buy around 450 properties a year between now and 2025 to meet that demand – because according to my calculations, an additional 13,500 people will want to live in all those ‘additional’ Walsall rental properties – so why is the government penalising landlords?
Thankfully the new housing minister Alok Sharma will carry on the work of the previous MP Garvin Barwell who had detached Teresa May’s new administration from the Cameron/Osborne laser-like focus of just home ownership to solve our housing issues, saying “We need to build more homes for every single type of person needing a home and not focus on one single tenure”.
The private rented sector became a stooge under David Cameron’s watch and still, with increasingly unaffordable Walsall house prices, the majority of new Walsall households will be relying on the rental sector in the future to house them. I can only say Westminster must put in place the measures that will allow the rental sector to flourish. Any restrictions on the supply of rental property will push up rents (bad news for tenants), thus side-lining those members of Walsall’s society who are already struggling.
Let’s hope this new Government continues to see the contribution landlords give to the country as a whole and that nothing nasty comes up in the near future!
If you want to discuss anything lettings, please do not hesitate to contact me on 01922 311016 or email me at email@example.com