The value of property owned by landlords in Britain will smash through the £1 trillion pound mark in mid-2015, says a new report.
Figures's from Kent Reliance, part of the OneSavings Bank Group, show that currently the total value of property in the private rented sector is £930.7bn, up £109.5bn compared to last year.
London accounts for 41 per cent of this value followed by the South East (15 per cent) which itself is larger than the North East, Wales, Yorkshire & the Humber, and the West Midlands combined.
"Buy to let property is going from strength to strength as an asset class in its own right," said Andy Golding, Chief Executive of OneSavings Bank. "Landlords have benefited from the recovery in house prices since 2009, which has pushed their wealth to within touching distance of £1 trillion. But as the sector’s value marches upwards, the main impetus has come from the growth in the number of households as demand from tenants continues to climb.
"Private renting isn’t a flash in the pan. While for many it is a lifestyle choice, the ongoing squeeze on wages, rising house prices, not to mention difficulty in obtaining sufficient mortgage finance is accentuating this shift in tenure from owner occupation to long term renting. In many ways, Britain is becoming a more normal nation, much more like its continental neighbours as a result."
New figures from Savills out today suggest that 1.2 million more households in England and Wales will be private renters by 2019, meaning a quarter of all homes will be privately rented. Its report also predicts only 16 per cent of under 35s will be homeowners compared to 28 per cent now.
In terms of the overall UK market, Savills forecasts that price growth will slow to two per cent next year, with London flatlining after outperforming every region.