There is an undersupply of rented accommodation to meet the demand in many areas of Britain, so refurbishing empty homes financed with bridging loans could ease the situation.
According to an October 2017 article on TheNegotiator.co.uk, the Royal Institute of Chartered Surveyors estimates that there is a shortfall of 1.8 million rental properties. It is predicted that by 2030, 240,000 new rental homes will be built, but this will not be enough to meet the demand.
Government changes to buy-to-let regulations have made it more expensive for landlords, which has caused a slowdown in landlords purchasing new properties.
Paresh Raja of Market Financial Solutions, speaking to TheNegotiator, says there are an estimated 1.4 million unoccupied homes in Britain. Many of them are empty because they are uninhabitable and could not be rented out in their present state. Bridging finance is available to fund refurbishment, not all of which involves major and expensive building work. Some properties need a new kitchen, bathroom, and redecoration to make them suitable for rented accommodation.
Loans are available to cover up to 100% of the refurbishment costs, and many lenders have reported an increased demand for short-term bridging loans for refurbishment projects. A bridging finance broker can find the best refurbishment loan deals for owners of empty properties
Refurbishing empty properties for rent may not solve the need for rental accommodation, but it will likely help. The solution to the shortage of rental properties consists of three strategies: building more rental accommodation, making it easier for landlords to expand their property portfolios, and refurbishing empty properties.