Recent stamp duty hikes for buy-to-let investors will create a more professional private rented sector, says UK housing minister.
- The UK government wants to create a better regulated private rented sector through products such as build-to-rent
- Housing Minister Brandon Lewis says that recent changes to buy-to-let is the government’s way of initiating a rise in the quality of rental products for British tenants
- The build-to-rent sector is predicted to be worth £50 billion by 2020
April’s stamp duty changes for buy-to-let should enhance the quality of the UK’s private rented sector (PRS) in the long-term.
Speaking at the recent Association of Residential Lettings Agents conference in London, Housing Minister Brandon Lewis told delegates that the government has targets to provide new homes for those that wish to enter the owner-occupied sector, and goals to create a better regulated marketplace for those that choose to rent.
Explaining the increased rates of tax on buy-to-let homes that came into force on April 1st Lewis declared that “our primary focus is increasing supply and home ownership”.
Yet while the government acknowledges the need for more homes for first-time buyers, these changes have also been introduced to increase the quality of product available for the growing number of people choosing to rent their accommodation.
He added: “We want more institutional money and more professionally managed property. Buy-to-let is still an area with capital security and revenue returns so there is still an attractive revenue model.”
Build-to-rent eliminates rogue landlords from the market and, instead, drives investment into developments with professional standards of management.
Today’s tenant, Generation Y, has a different set of values and ideologies to those their parents held. This extends to accommodation, with many choosing to rent as it better fits with their increasingly transient lifestyle.
Knight Frank estimates that the build-to-rent sector will be worth £50 billion by 2020.