March of ‘generation rent’ to continue as further PRS growth predicted for Scotland

Scotland’s ‘generation rent’ is expected to continue throughout the next decade as the country is predicted to be one of UK’s fastest growing private rental markets.

New analysis from PwC has suggested that private rental tenure in the country is expected to rise by 16 per cent with owner occupied numbers forecast to fall by almost 7 per cent.

In 2000, almost two thirds of Scots owned a home they lived in (either outright or with a mortgage) with just one in three renting from the social sector or private landlords. But by 2025, the levels are expected to almost equalise with around half of Scots (44 per cent) expected to rent their home.

Susannah Simpson, tax partner, PwC in Scotland, said: “A number of factors are driving this predicted shift in tenure within the housing sector: a lack of new housing supply to meet increasing demand has pushed up prices to unaffordable levels for many, mortgage deposits require savings that are well out of the reach of first time buyers and we’re also seeing younger people increasingly showing a preference for high quality rental housing.

“In a move to reverse this trend, the Scottish Government has introduced a raft of policy measures aimed at promoting home ownership, and at the same time supporting the growth in the levels of affordable homes for rent by councils or registered social landlords – for example through the National Housing Trust.

“While many housebuilders have considered the need for affordable home ownership and low cost rental properties in their development plans to date, Scottish Government measure will provide them with greater confidence to pursue investment and development programmes over the coming years to meet the needs of future generations.”