Since the recession the demand for rental accommodation has soared, as would-be buyers have struggled to get on to the property ladder. This has allowed buy-to-let investors to charge record rental returns and experience shorter void periods than ever before.
Typically in the past, the average homeowner had paid off their mortgage prior to reaching retirement age, but in the future this situation could change due to an increasing number having to rent.
In addition pressure on pension funds may make it increasingly difficult for people to maintain their standard of living in retirement.
Landlord Assist is concerned that if renting continues to become the norm then more people will have insufficient funds when approaching retirement age to afford rental payments.
Graham Kinnear, MD of Landlord Assist says: “Increased demand for rental accommodation is obviously good news for landlords, but the wider picture is more worrying in that renters, who may have previously envisaged owning a property but have been forced to rent, may not have the finances to maintain rental payments in their retirement.
“At the same time a reduction in pensions and changes to housing benefits will make it increasingly difficult for people to fund their retirement and accommodation charges.”
Stephen Parry, Commercial Director at Landlord Assist is similarly concerned by the prospect and urges the Government to support pensioners with additional rental assistance to accommodate increasing rental levels.
He says: “The income that many pensioners currently receive is hardly enough to pay household bills let alone rental payments. We feel the Government must look at this. It is an issue which must be addressed and one which will only get worse if rental demand increases amongst retired tenants.”
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