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Rented Housing

Communities and Local Government written question – answered on 6th June 2007.

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Photo of Margaret Moran Margaret Moran Labour, Luton South

To ask the Secretary of State for Communities and Local Government what estimate she has made of the impact of trends in buy-to-let properties on (a) the housing market and (b) homelessness.

Photo of Yvette Cooper Yvette Cooper Minister of State (Department of Communities and Local Government) (Housing and Planning)

Estimating the precise impact of buy-to-let on the housing market is difficult and there is little evidence available. The buy-to-let market has expanded rapidly in the last 10 years since the creation of dedicated buy-to-let mortgages in 1996, rising from 6 per cent. of the private rented stock in 2000 to almost 35 per cent. in 2006. Despite this increase in buy-to-let, the overall size of the private rented sector has remained relatively stable and has only experienced a slight increase as a proportion of total stock from about 10 per cent. to 12 per cent. There has been an increase in the proportion of private rented sector properties that are buy-to-let.

Evidence from the English House Conditions Survey shows that between 1996 and 2004 the percentage of 'decent' homes in the PRS has increased by nearly 35 per cent. compared to only 18 per cent. in the owner-occupied sector.

In recent years, due to the increase in supply of private rented properties, rents have not been rising as fast as house prices. This suggests that buy-to-let is unlikely to have had a significant impact on homelessness, which is currently at its lowest level since the early 1980s.

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