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Em Morley

Latest National and Regional Trends Revealed in Belvoir’s Rental Index

Published On: June 26, 2018 at 9:56 am

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Categories: Lettings News

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Belvoir’s first quarter Q1 index, combined with results gathered from a franchise survey regarding tenant and landlord trends, revealed the highest percentage of landlords selling up for over a year, with tax changes, frequent regulation and legislation adjustments stated as the primary reason.

The number of landlords experiencing voids decreased in Q1. This suggests an increased pace in letting, despite the demand for flats being reportedly static to dropping, with far more demand for houses from Q4 2017.

Belvoir CEO Dorian Gonsalves comments: “The trends that Belvoir is reporting are very much in line with our predictions at the beginning of this year.

“As 2018 progresses, there is no doubt that landlords and tenants will find themselves shouldered with an extra burden of cost due to continued government interference in the rental market, which includes the implementation of punitive tax changes.

“As more landlords see their profits eroded, and more legislation is in the pipeline, more landlords are likely to exit the market. We are still seeing new investment in the BTL market, but the number of properties being bought has decreased.”

Statistics provided showed that monthly rents are ranging from an average of £597 in the North West to £658 in the East Midlands. In the South West rents are considerably more, ranging from £724 in the South West to £1,030 in the South East the highest rent is claimed to be in London, at £1,428 month.

In particular, a rental inflation has occurred on four to five-bedroom detached properties. However, generally, rent was stable, with a majority of offices claiming that rents remain static and that any increases that occurred were minimal.

For the remainder of this year, further rental increases are anticipated for properties, specifically, properties for larger families, which currently remain in insufficient supply. Letting rooms is also predicted to remain fixed.

Tories Could Lose Next Election as Number of Renters in Marginal Seats Increases

Published On: June 26, 2018 at 9:30 am

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Categories: Law News

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Due to the growth in generation rent, Conservatives could potentially lose the next election. Falling levels of home ownership must be reversed if there is any chance of winning.

This warning has been brought to attention by think tank Onward, managed by Will Tanner, a former Deputy Head of Policy to Theresa May.

From recent analysis, due to be published yesterday, the number of those privately renting is witnessing a rapid increase in marginal seats, meaning that it is imperative for Tories to win the election in order to gain a majority, rather than in safe Tory-held constituencies.

Onward expresses that the prospect of owning a property “is becoming a pipe dream for a generation”. It calls for “very radical action to get homeownership growing again.”

Analysis by MP Neil O’Brien, cites research revealing that private tenants are more likely to vote Labour, while homeowners will opposingly be in favour of the Tories.

The number of constituencies is predicted to rise to 253 by the 2022 election. This is an increase from 18 constituencies in 2001.

Furthermore, the proportion of households in private rentals is expected to climb by 3% by 2022, to stand at 21.8% of all homes. 15.5% of households will be privately renting, in the 20 safest Tory constituencies.

Kensington, Perth and North Perthshire, Dudley North, Newcastle-under-Lyme, Crewe and Nantwich, and Canterbury are all included in the marginal seats that the Tories should be targeting, with the Labour majority of Kensington being 20, Perth and North Perthshire, 21, Dudley North, 22, Newcastle-under-Lyme, 30, Crewe and Nantwich, 48 and Canterbury, 187.

 

10 Years for First Time Buyers to Secure a Deposit

Published On: June 26, 2018 at 8:52 am

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Categories: Property News

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New figures reveal that on average, first-time-buyers have no alternative but to rent a property for a longer period of time, due to a 10 year save for a 15% deposit, despite the halt in property prices.

According to Nationwide, property prices have experienced a decline by 0.2% during the May period. In addition, annual growth plateaued to 2.4% from the previous 2.6% in April. Yet, there remains a high demand for rental properties due to the difficulty of saving for and securing a deposit for a mortgage.

During the beginning of 2018, the average single first-time-buyer would need to save for 10 and a half years if they were to raise a 15% deposit on their first property, according to recent data provided by Hamptons International.

For a first-time-buyer who began saving in the first quarter of the year, the purchasing of a property would not be possible until the autumn of 2028. Similarly, a single Londoner intending to invest in their first property would need to save for 17 years in order to raise a 15% deposit.

On the other hand, the average couple intending on buying their first home would need to save for five years in order to purchase their own property by the spring of 2023, five years less than a single first-time-buyer.

Aneisha Beveridge, an analyst at Hamptons International, commented: “Saving a deposit is still the biggest barrier to buying a first home. It takes a single person more than a decade to save up in the current climate.

“But the additional support from Help to Buy brings down the time it takes to raise a deposit by over six years for a single first-time buyer.

“Slower house price growth in the capital has meant that it’s now six months quicker for a couple, who share household spending, to save up for a 15% deposit in London.

“But it still takes a couple in London eight years to save up, twice as long as someone buying a home in the north.”

Onward’s Buy-to-Let Report Riddled with Errors

Published On: June 26, 2018 at 8:03 am

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Categories: Property News

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Onward housing report riddled with errors

A new think tank has published findings that are completely wrong in its analysis of the private rental sector, with the number of buy-to-let mortgages falling, not rising.

In its first housing report, Onward claimed that at the end of 2017, buy-to-let lending was above the 2007 peak. In actual fact, according to figures from UK Finance (backed up by the government’s own statistics), buy-to-let lending for house purchases has fallen from over 183,000 loans in 2007, to just 74,900 in 2017. This is a fall of nearly 60%, making it a significant change.

The government’s own statistics show that the number of private rented homes actually fell by 46,000 in 2017. The total number of buy-to-let mortgages, including re-mortgages, also fell from 339,000 in 2007, to 227,000 in 2017, a drop by about a third.

On the back of its assertion, Onward called for further tax increases to reduce investment in homes designated for the private rental sector, arguing that landlords are taxed more advantageously than homeowners. However, according to Paul Johnson, director of the Institute for Fiscal Studies, “The tax system is not, and was not, even before the recent changes, more generous to people buying to let.”

Onward housing report riddled with errors

A new think tank has published findings that are completely wrong: in fact, the number of buy-to-let mortgages is falling, not rising.

Impact of the housing report riddled with errors

With another report today saying that it now takes just over ten years for the average first-time buyer to save for a 15% deposit, the Residential Landlords Association (RLA) argues that this is increasing demand on the private rented sector. As such, taking action to reduce the supply of rented homes available would logically seem a step in the wrong direction.

David Smith, Policy Director for the Residential Landlords Association, said:

“Today’s [Onwards] report is riddled with errors and fails to address the fundamental point that we need more homes to rent, not less.

“Rather than coming out with ideological assaults on the private rented sector, we need to reform tax so that it encourages the development of new homes to rent and longer tenancies so that the sector can adequately provide the pathway for tenants to go from renting to home ownership.”

Insufficient Housing Stock Hits One Million Last-Time Buyers

Published On: June 25, 2018 at 9:26 am

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Increased property prices are preventing the equivalent of 1.4m last-time buyers from downsizing, in addition to a lack of appropriate housing stock.

Key Retirement, an equity release provider, discovered that 30% of over-65s are intending on going through the process of a final home move.

However, 44% of those wanting to move expressed that there was no suitable housing stock available, while the remaining 35% claimed that they would not benefit financially.

Demand for housing was at its maximum in the North East and South West, with 58% and 44% seeking to downsize, respectively.

As a result of this, there are 42% anxious about bill payments in a property that is far too big for them and their needs.

Dean Mirfin, Chief Product Officer at Key Retirement, commented: “Downsizing should make financial sense for older homeowners it releases money to pay for retirement, and it also should make sense for the property market as a whole as it frees up bigger houses.

“But despite the numbers of older homeowners wanting to downsize it is clear they face problems in finding suitable homes for retirement, and for many, the finances just don’t add up. Unfortunately, that leaves them struggling to maintain homes, and in many cases, struggling financially.”

We recently looked into the differences between buying and renting across the UK, from two studies. One took the cost of raising a deposit into account, while the other focused on monthly mortgage repayments compared to rent prices.

Read the stories in full here and here

 

 

 

All is Not Lost: Property Market Springs Back to Life in May

Published On: June 25, 2018 at 8:58 am

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Categories: Property News

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Though a progression in the property market may have taken a little longer than expected this year, according to HMRC data, a 12.1% increase in transactions has surfaced during May.

During the April period, there was a registered drop in sales according to HMRC’s property transaction statistics. However, recent data suggests a far more optimistic future for the market.

As recorded by the taxman, despite there being a 1% drop, annually, 95,480 residential property transactions witnessed a rise of 12.1% in April.

All regions in the UK experienced a monthly rise. The Welsh market saw an increase of 25.2% to 4,460 transactions. In addition, England was up by 12.4% in sales to 80,900. As for Northern Ireland, there was a 10.8% jump over the month to 2,150 deals, whilst Scotland’s transactions were up by 3.6% to 7,970 on a monthly basis.

When considering previous figures from 2017, Wales and England were down by 0.4% and 0.5% annually, while Scottish transactions fell 7%. Northern Ireland was an exception, seeing a soar in annual sales, of 1.8%.
Remarking on the non-adjusted figures, Neil Knight, Business Development Director of Spicerhaart Part Exchange & Assisted Move, said:

“While we are still nowhere near the levels we were seeing before the credit crunch – when the number of transactions had risen constantly over a number of years to reach a peak of around 150,000 per month – it is a marked increase and could suggest we will start to see a bit of an uplift, especially in the new build sector.

“We are currently working with a range of house builders that have got lots of big developments in the pipeline.

“The focus on new housing over the past few years – with incentives such as Help to Buy – is starting to boost the new-build sector, and while we are unlikely to hit the Government’s targets, we are at least moving in the right direction, and this should help boost the rest of the property sector too.”