Saturday, June 16, 2007

Buy to let blight

There is an interesting article in the Guardian pointing out that buy to let landlords are buying up properties suitable for families in Nottingham and letting them out to students, and that this is causing major problems in the area. Students leaving the place in a mess, shops closing and pubs closing during vacation, and schools being put at risk as there are fewer children.

Emailed comments from readers at the end confirm this trend for other towns such as York and Bath and bemoan the fact that absentee buy to let landlords are being allowed multiple mortgages by landlords helping to push property prices beyond the reach of ordinary people.

It is a difficult problem. One answer is no doubt the extension of licensing suggested by the article, which points out that landlords are selling larger properties and buying two story ones to escape the current licensing regime. Any extension of licensing would be bitterly opposed by the landlording community however (many of whom are responsible and provide an excellent service), and local authorities would struggle with their present funding to deal with this additional work.

However the real problem is undoubtedly the shortage of housing generally. After all students have to live somewhere. Universities generally bring benefits to towns and cities, but you cannot have a university without students! Also many students will stay in their university town and become part of the community - at least that is very common in my own city of Norwich (my husband being one such!).

It looks as if the problem may be relieved to a certain extent in Nottingham as at least 5,000 purpose built student rooms are to be built there shortly. If other universities follow suit (and if there is profit to be obtained from student housing they probably will if they can get the investment), this will help considerably. However unless either more property is built, or there is a property crash, or wages increase substantially, it is unlikely that property will become more affordable for low income families.

But then, it was ever thus! Low income families being unable to afford to buy their own homes, although unfortunate, is hardly a new problem.

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