Should you buy or rent a house? Buying your own home can be expensive but could save you money over the years. Renting a property through a letting agent or private landlord offers less autonomy to live by your own rules, with more flexibility if you need to move.
Yet there is third way that many people seem to forget and it plays a very important role in the housing of Rotherham people.
Collectively known as social housing, it is affordable housing, which is let by the council or a housing association to those considered to be in specific need for a rental price below those characteristic in the private rental market.
All you need to know about Rotherham’s social housing
In Rotherham there are…
- 12,034 social housing households – that’s 26.21% of all the households in Rotherham.
- 6,135 families in the Rotherham Metropolitan Borough Council area on their waiting list
The latter figure is similar to the early 1990s. However, the numbers peaked in 2012, when it stood at 27,103 families. This means that there’s actually been a drop of 77.3% in the last four years.
Nevertheless, this doesn’t necessarily mean that more families are being supplied with their own council house or housing association property.
Six years ago, Westminster gave local authorities the authority to limit entitlement for social housing, quite conspicuously dismissing those that did not have an association or link to the locality.
Interestingly, the rents in the social rented segment have also been growing at a faster rate than they have for private tenants. In our area, the average rent in 1998 for a council house/housing association property was £123.85 a month, whilst today its £323.96. That’s a rise of 162% in 19 years.
Unfortunately the stats for private renting only go back to 2005. For a fair comparison we’ll focus on the last 12 years. Over this time period, private rents have increased nationally by a net figure of 19.7%, whilst rents for social housing have increased by 59.1%. This is actually above inflation rates for the same period.
So what does this all mean for the homeowners, landlords and tenants of Rotherham?
Rents in the private rental sector in Rotherham will increase sharply during the next five years.
Even though the council house waiting list has decreased, the number of new council and housing association properties being built is at a 70 year low. The government crusade against buy-to-let landlords, together with the increased taxation and the banning of tenant fees to agents will restrict the supply of private rental property, which in turn, using simple supply and demand economics, will mean private rents will rise. As a result, I’d argue that buy-to-let investment is a good choice – irrespective of the increased fees and taxation laid at the door of landlords.
This will also meant that property values will remain strong and stable as the number of people moving to a new house (and selling their old property) will continue to remain restricted. As a result, thanks to limited supply and choice, buyers will have to pay decent money for any property they wish to buy.