In my last article, I wrote about the diminishing level of stock in the property market for sale in York as well as the consequent impact on York landlords. In essence, there has been a decline in properties on the market for sale by 55% than from 10 years ago, which will undoubtedly have an impact on property prices, given demand and supply pressures.
I was interested in finding out on a more hyper-local level, the number of births in York versus the number of New properties being built. Over the last six years, number of births have outnumbered new builds on average by a factor of 3.36/1. This just emphasises that we are not building enough homes to satisfy demand and will further constrain the property market in years to come.
As property prices continue to rise, would-be First Time Buyers are likely to be further thrust into renting homes and this can be seen by what has transpired since the turn of the century. Back in 2001, there were a total of 77,375 households in York, of which 55,710, i.e. 72% were home-ownered. By 2011, there were only 55,227 home-ownered properties, representing 66% of the market.
Next, if we look at the Buy To Let sector in York, between 2001 to 2011, 6,632 properties were built in York. Interestingly, the number of rental properties in York increased by 7,284 taking the total number of private rented properties from 7,696 in 2001 to 14,980 in 2011. This means the percentage of Private Rental Sector (PRS) properties in York increased from 10% to 18% in only ten years. I would imagine that this figure would have been inflated by uncertainty in the property market from the 2008/09 credit crunch.
Something worth noting is that this is not unfamiliar territory. The below graph shows the breakdown of property ownership in the UK from 1918 to 2008. As at 1918, only 23% of properties were occupied under home-ownership, the vast majority being in the PRS.
90 years on and the roles have reversed with Home Ownership making up over 60% of the market, although the curve is clearly starting to dip, reiterating my point above.
So, what next for York BTL? I’m going out on a whim to say that, whilst the lettings market is becoming heavily more regulated, landlords have been picked on by the government, affordability checks on mortgages are more stringent than ever, the York Buy-to-Let market will continue to grow.
I’m looking forward to reporting back once the next set of Census data is released i.e. 2021 and how the York BTL sector has grown. Bearing that in mind, I’m confident that we can expect to see a culling of the ‘amateur landlord’ and only professional landlords or landlords who take professional advice will stand the test of time. With that, if you need any buy to let advice, you know where I am.