Additional 14,867 Sheffield Rented Homes Required by 2027
We have been doing some research, looking both at National and Regional reports on the demand and supply of property and people together with future projections on the economy, population and family demographics with some interesting results. According to the Office of National Statistics, in the last financial year nationally, private renting grew by 74,000 households, whilst the owner occupied dwelling stock increased by 101,000 and social (aka council and housing association) stock increased by 12,000 dwellings.
It was the private rental figures that caught our eye. With eight or nine years of recovery since the Credit Crunch, economic recovery and continuing low interest rates have done little to setback the mounting need for rented housing. In fact, with house price inflation pushing upwards much quicker than wage growth, this has meant to make owning one’s home even more out of reach for many Millennials, all at a time when the number of council/social housing has shrunk by just over 2.5% since 2003, making more households move into private renting.
There are 89,267 people living in 34,690 privately rented properties in Sheffield.
In the next nine years, looking at the future population growth statistics for the Sheffield area and making careful and moderate calculations of what proportion of those extra people due to live in Sheffield will rent as opposed to buy, in the next ten years, 38,257 people (adults and children combined) will require a private rented property to live in.
Therefore, the number of Private Rented homes in Sheffield will need to rise by 14,867 households over the next nine years,
That’s 1,652 additional Sheffield properties per year that will need to be bought by Sheffield landlords, for the next nine years to meet that demand.
… and remember, we are being conservative (with a small ‘c’) with those calculations, as demand for privately rented homes in Sheffield could still rise more abruptly than we have predicted as we would ask if Theresa May’s policies of building 400,000 affordable homes (which would syphon in this 5-year Parliamentary term is rather optimistic, if not fanciful?
So, one has to ask wonder if it was wise to introduce a buy to let stamp duty surcharge of 3% and the constraint on mortgage tax relief could curtail and hold back the ability of private landlords to expand their portfolios?
Well a lot of landlords are taking on these new hurdles to buy to let and working smarter. Buying the property at the right price and using an agent to negotiate on your behalf (we do this all the time) … and the 3% stamp duty level isn’t an issue. Incorporating your property portfolio into a Limited Company is also a way to circumnavigate the issues of mortgage tax relief (although there are other hurdles that need to be navigated on that tack), but just look at the growth of proportion of Buy to Let properties in the Country since the Summer of 2016 … something tells us smart Landlords are seeing these challenges as just that … challenges which can be overcome by working smarter.
We have a steady stream of Sheffield landlords every week asking us our opinion on the future of the Sheffield property market and their individual future strategy and, whether you are a landlord of ours or not, if you ever want to send us an email or pop into our office to chat on how you could navigate these new Buy to Let waters … it will be good to speak to you (because you wouldn’t want other landlords to have an advantage over you – would you?).
As always, if you are an investor in the Sheffield property market and would like a second opinion on a property you have seen, then send the URL of the properties you have seen online over. Or if you would like to pop in and have a chat, then you can either email on email@example.com or call on 0114 201 4325. The kettle is always on and we will even pull out the posh biscuits!
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