Investment zones could push people into renting - lawyer

The government 's proposed investment zones to stimulate growth across the UK could push more people towards renting rather than home ownership.

That 's according to a residential property expert at law firm Shakespeare Martineau.

Chancellor Kawsi Kwarteng announce in his mini-budget pans to create investment zones, which would have tax incentives for businesses.

Neil Gosling, partner and head of residential development at law firm Shakespeare Martineau, says the investment zones are focused on inner city and apartment-led schemes which would most likely be purchased by investors as assets for rental income.

He adds that, with rising costs and property prices remaining high, this new strategy could push more people towards renting.

Mr Gosling (pictured) said: “The investment zones appear to be focused on inner city, high-rise apartment-led schemes.

“However, the increase in remote working has created more demand for space and gardens as opposed to balconies and small apartments.

“If the intention is for more inner city high-rise, the likelihood is that this will be bought up by foreign investors, pension funds and investment companies who will use the asset for rental income through the private rented sector and build to rent schemes.

“We have just gone through a phase of demolishing old high-rise council blocks, and we could find this approach reverts back to that model.

“It should be noted that there are a huge number of vacant apartments across the country.

“However, with increased interest rates, mortgage lending becoming more expensive and housing prices still hot, the economic crisis along with this revised planning strategy may be designed to start pushing people into a rental system rather than home ownership. ”