If we crunch some numbers here – and anyone who rents may need a stiff drink before reading on – at the current rate of growth, the average rent will double in just eight years and four months, taking it past £5,000 a month in London. It is hard to understand how anyone is meant to afford that.
It is not any better for landlords. Indeed, they are leaving the market at an accelerating pace because they can no longer make any money. Mortgage costs have soared and the Government has imposed energy saving targets that take no account of the age of the building. Taxes have been increased and are likely to go up again in the Budget, and the regulatory burden has become harder and harder to manage.
Add it all up, and this is one of the most dysfunctional markets ever created. The Government is about to make it a whole lot worse. Angela Rayner, the Deputy Prime Minister, is reported to be at loggerheads with Rachel Reeves, the Chancellor, over the amount she will release to be spent on social housing. It turns out that Labour only approves of people who own one home, whose home is not too valuable, and who require subsidies from the state. Everyone else will have to fend for themselves.
We all know why the market is such a mess. The Government has launched a war on landlords in the entirely mistaken belief that by punishing one group of property owners it will somehow help another group. That has backfired spectacularly, with house prices still rising from already unaffordable levels, and remaining prohibitively expensive for first-time buyers, despite the huge numbers of buy-to-let landlords who have been getting out as fast as they can.
At the same time, immigration has remained at very high levels. Sure, it has come down slightly, but net immigration is still projected at more 300,000 people this year, and that doesn’t include the irregular migrants, as the illegal asylum seekers are now known, all of whom will have to be housed somewhere.
