Rental growth continues to surge and in order to meet growing demand, the UK will need hundreds of thousands of new rental homes every year for the next decade, the Guardian reported.
According to analysis by the consultancy Capital Economics, commissioned by the lobby group National Residential Landlords Association (NRLA), private rented sector supply will have to increase by 227,000 homes a year to meet the demand for 1.8 million new households over the next decade.
Ben Beadle, chief executive of the NRLA, said there was a “supply crisis now engulfing the sector” and that “urgent action” was needed to provide affordable rental housing.
The number of households in the UK private rented sector increased to 4.5 million in 2017 from 2.8 million in 2007, official figures show.
Meanwhile, property website Rightmove reported that private rents in Britain rose at their fastest rate on record in January this year, with rents outside London 9.9% higher than a year ago.
The shortage of rental homes follows government policy that removed tax relief from buy-to-let landlords, who have also benefited from low interest rates and rising house prices in the last decade.
Andrew Evans, managing economist at Capital Economics, said supply of rental properties “could fall by over half a million more over the next decade” if no changes are made.
A spokesperson for the Department for Levelling Up, Housing and Communities, told the Guardian: “We support the private rented sector and recognise the crucial role build-to-rent homes have in boosting housing supply, and increasing quality and choice for renters across the country.
“This government is building more genuinely affordable homes to help people on to the housing ladder. Since 2010, we have delivered more than 574,000 affordable homes and we are investing £11.5bn in affordable housing.”