Landlords and property investors have come under fire in a recent survey, which suggests they are major contributors to the challenges faced by first-time and local buyers in the housing market. The poll, commissioned by proptech firm Alto, reveals that 61% of respondents believe landlords are crowding out potential homeowners, while 48% support stricter regulations on property investors. This sentiment underscores a growing frustration among the public regarding the accessibility of new homes.

The survey highlights that nearly half of participants feel that newly constructed properties in their areas are predominantly aimed at investors rather than local buyers. The findings are concerning, especially as only 10% of new builds are making it to the open market, according to the Office for National Statistics (ONS). Of approximately 200,000 new homes built in England over the past year, just 21,261 reached the traditional sales market. This trend is particularly pronounced in London, where a mere 2% of new builds were available for general purchase.

The new rules

Riccardo Iannucci-Dawson, CEO of Alto, commented on the disparity between home construction and market availability, stating, "People see homes being built and assume they’ll be available to buy, but the reality is many never reach the market buyers actually interact with day to day." This situation raises concerns about the long-term implications for prospective homeowners, particularly first-time buyers who are already facing significant financial barriers.

The report indicates that 36% of respondents believe they will never own a home, citing exorbitant prices as the leading factor. A staggering 60% of participants argue that the market is simply too expensive, while 58% feel that their income is insufficient to secure a property. The perception is that the current housing landscape is increasingly skewed in favour of landlords and institutional investors, leaving local buyers with limited options.

Impact on landlords

As the demand for rental properties continues to rise, landlords may need to adapt their strategies to remain competitive in a changing market. The survey reveals that 44% of participants believe the availability of properties for purchase is inadequate, indicating a tightening market for first-time buyers. With more individuals expressing a preference for renting—15% of respondents indicated this as their choice—the landscape appears to be shifting towards a more rental-oriented culture, akin to practices seen in other European nations.

The shift towards long-term renting may also have implications for the types of properties that landlords choose to invest in. With fewer new homes entering the open market, landlords might increasingly consider investing in build-to-rent developments, which cater to a growing number of tenants unwilling or unable to purchase homes. This trend could further entrench the perception of landlords as barriers to homeownership, particularly if rental prices rise in tandem with demand.

Market reaction

The public's discontent is not occurring in a vacuum; it reflects broader market dynamics and governmental policies. Many stakeholders are calling for action to address the perceived imbalance between investors and first-time buyers. For example, nearly half of survey respondents advocate for tougher restrictions on property investors, suggesting that public sentiment is shifting towards a demand for regulatory intervention.

The upcoming elections in Scotland also spotlight the need for policy reform. Scottish landlords have expressed the hope that the next government will implement measures to limit the influx of investors into the housing market, reflecting a broader desire for a more equitable distribution of housing opportunities. As the landscape continues to evolve, landlords may find themselves at a crossroads, needing to balance their investment strategies with the growing public demand for homeownership.

The future of homeownership in the UK remains uncertain as the market grapples with these challenges. With landlords often viewed as the primary culprits in the ongoing housing crisis, the next steps taken by both policymakers and property investors will be crucial in shaping the accessibility of homes for future generations. As the survey indicates, the appetite for homeownership is still present, but the opportunities to fulfil that desire are dwindling rapidly.