The past year has seen a rise in the value of the Private Rented Sector (PRS) in England, Wales and Scotland, according to a recent report.
Shawbrook Bank’s the Changing Face of Buy-to-Let has revealed growth of 5.8 per cent, taking the total value of the sector to £1.4 trillion.
The report concluded that the Covid-19 pandemic and subsequent government reaction has dramatically re-shaped the market.
The Stamp Duty holiday turbocharged the property market after the first national lockdown paused transactions and this affected buy-to-let property prices as well.
And although the PRS has contracted over the last year by 2.6 per cent, making up 17 per cent of overall housing stock, the outlook points to growth.
The report also suggests almost half (46 per cent) of landlords reduced monthly rent payments for their tenants because of the pandemic.
But more than a third of landlords plan to buy property in the next year, with two thirds confident about the market.
It concluded that rents have increased annually by 1.6 per cent, with the average rent across the UK now £919 per month.
And more than half of tenants saying they would be prepared to pay more money if the landlord undertook a renovation of the property.
Finally, despite the impact of March 2020, mortgage lending is now back on an upwards trajectory and re-mortgaging levels are expected to grow by four per cent in 2021.
John Eastgate, managing director, Property Finance at Shawbrook Bank, says: “As we entered our first national lockdown in March 2020, the outlook for the housing market was uncertain.
“However, government incentives negated the economic impact of the pandemic and both buyers and sellers alike sprang into action in response.
“Meanwhile, the PRS also stood up to the challenge. Landlords acted sensibly, with significant numbers offering their tenants rent holidays or reductions during the most difficult times.
“And as we look towards recovery, investors and brokers alike remain confident about the future of the market.
“With demand for housing stock high, supply remaining low and access to mortgage finance for would-be home-owners problematic, the PRS remains a vital component of the UK’s housing market.”