Booming rental sector ‘could leave poorer people struggling’

THE private rented sector is booming in Wales – but experts warn it means poorer people will find it harder to save for a home.

Analysis reveals 1,660 companies across the country were involved in buying and renting property last year, a rise from 1,600 the year before.

These businesses generally include long-term property investment, meaning most landlords will fall into the category.

The figures, from the Office for National Statistics, go back as far as 2010 when there were 1,230 such companies. The number has trended upwards since then.

Nearly a fifth of these businesses were based in Cardiff (315), followed by Swansea (160) and Powys and the Vale of Glamorgan (100 each). Just 15 were in Blaenau Gwent.

Industry experts said businesses are capitalising on the strength of the rental market.

Daniel Peacock, from property investment firm Property Secrets, said: “Sadly we have an ever growing financial gap in this country between the rich and the poor and whilst it is easier for those at the top of the ladder to obtain the finance needed to purchase multiple properties it is more difficult for those at the bottom to even obtain their first.

“House prices have stayed relatively flat over the last 12 months but rent has continued to soar which makes it even more difficult for tenants to save to buy their first home.

“Those able to purchase multiple properties can set going rates for rents and this can be attractive as landlords not only benefit from capital growth but a rental yield that is often superior to their own mortgage costs.

“Should stamp duty be scrapped on houses under £500,000 it is likely to lead to an increase of even more investment property purchases which could lead to even more rising rents ensuring those that own property will benefit from even greater rental yields in the future.”