Cancellation of benefits for homeowners in the UK may revise

The private sector rental market the UK real estate is booming, but may evolve as the government plans to change the conditions of tax incentives for homeowners paying a mortgage.

Rents in the 3rd quarter of 2015 increased slightly compared to the same period in 2015. Rent of studios remained virtually unchanged, but rent a large detached house on 4 and 5 bedrooms grew by an average of £25 and £50 pounds per month.

Belvoir company that conducted the study also notes that demand for homes in England has increased across the country by 88%, and the demand for apartments in 63.5%.

Meanwhile, many homeowners believe that the stability of the rental market in the United Kingdom at risk if the planned tax changes in 2017 will come into force and will not be reviewed by the government.

The study also shows that the most scarce objects are half houses and apartments three bedrooms, 81% of offices said about the lack of this kind of housing, 68% of offices stated about the shortage of detached homes and 66% of the housing shortage in the two bedrooms. Almost half of the offices indicated that the average rental time is 13 – 18 months, and 27.7% stated that the average rental period is more than two years. And the downtime of the housing in the 3 quarter of 2016 amounted to no more than two weeks.

This state of the rental market of real estate in England suggests that demand for rental continues to grow. There is not enough housing to students arriving migrants, working families, professionals, changing the place of the residence or simply for those Brits who decided to improve their living conditions.

2015 and 2016 – that was the first years after the protracted recession, when wages of the British people began to grow and they began to worry about improving living conditions. However, this situation may change next year, when Brexit will cause inflation and this will hit household pocketbooks. The purchasing power of the tenant in this case will fall and landlords will try to raise rents to cover increased government tax expenditures.

In the case that the government will meet the landlords, the rental market can rush the flow of low-quality housing for market sale, which will exacerbate the already scarce situation in the market.

® Helen Entree. 08.11.2016 G.

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