Written By Em

Em

Em Morley

Government UK House Price Index shows annual growth but month-on-month standstill

Published On: April 23, 2021 at 8:17 am

Author:

Categories: Property News

Tags: ,,,,,

Nation’s HMOs worth £26bn in current market conditions

The latest Government UK House Price Index has been released, showing an average annual increase of 8.6% for February 2021.

The index also shows a 0.0% month-on-month change from January, with the average price of a property in the UK sitting at £250,341.

Colby Short, founder and CEO of GetAgent.co.uk, comments: “The market remains in a very strong position despite monthly price growth sitting still and this was no doubt down to two factors. The first being the continued difficulties in securing a buyer caused by lockdown restrictions and the second being a drop in momentum on the run-up to what would have been the Stamp Duty holiday deadline. 

“While the latter will no doubt have an impact when it does arrive, it’s far more likely price growth will hit a bump in the road rather than a brick wall. The main reason for this is a severe shortage of housing stock available to satisfy demand and so even when buyer numbers reduce, we’re likely to see demand continue to outstrip supply which will keep the rate of house price growth stable.”

James Forrester, Managing Director of Barrows and Forrester, comments: “Many will be quick to panic at the sight of a month-on-month price growth stall but this simply doesn’t portray the overall health of the market, in the same way our efforts in combatting Covid can???t be assessed on such a short-term basis.

“The long-term picture shows a market in very good health, driven by strong regional performances across the board, from the South West, the East Midlands, Yorkshire and the Humber and the North West. As we enter what is often the busiest time of year, we can expect the market temperature to rise and house prices to follow suit for the remainder of the year, at the least.???

Marc von Grundherr, Director of Benham and Reeves, comments: “Although London continues to trail the rest in terms of the rate of house price growth, we’re certainly starting to see an early indication that the market is on the up. Tenant and homebuyer demand has started to lift during the first quarter of the year and this is only likely to grow stronger as lockdown restrictions are lifted and a return to professional and social normality continues.”

“While the market isn’t running as hot as other UK regions at present, this should work in the favour of the London market in the long run. A far more steady return to form is likely to be made and this will ensure that any crash landing as a result of the Stamp Duty holiday ending is going to minimised within the capital.”

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, comments: “The property market remains in a parallel universe at odds with the wider reality everyone has been living. It’s been a gloom-defying 12 months given that last March, when the first lockdown arrived, the market seized up, mortgage products were withdrawn and everyone held their breath.

“Fast forward a year and you no longer need to be a mystic or expert to predict what comes next and that’s precisely the point. Confidence is king and there’s plenty of it out there. That would have remained true even if the Stamp Duty holiday had ended. Now that it hasn’t, that’s just more fuel on the fire but its impact has been overstated all along.

“When it does finally end at the end of September, the market is likely to be cooling by then anyway after another bumper summer. Markets don’t move in straight lines but in the meantime the busy summer season and high demand, which is still growing faster than supply as the weather improves, is doing nothing to slow price rises.”

Government statistics show 353,000 private tenants in rent arrears at end of 2020

Published On: April 22, 2021 at 8:23 am

Author:

Categories: Tenant News

Tags: ,,

Renters and landlords face cliff edge as furlough ends

Yesterday (21st April 2021) new statistics from the Government were released showing that almost one in five private renters in England are either in arrears or likely to fall into arrears in the next three months. 

These statistics come from the findings of the Household Resilience Study: Wave 2 on the Government website. The study took place in November and December 2020. This was a follow up to the Wave 1 survey, completed between June and July 2020.

The key findings include:

  • In November-December 2020, 9% of private renters (353,000 households) were in arrears. This compares to 3% in 2019-20 and 7% in June-July 2020.
  • A further 8% of private renters said they were very or fairly likely to fall behind with rent payments in the next three months, representing approximately 278,000 households. 
  • The main reasons renters gave for struggling to keep up with rent payments were being furloughed on reduced pay (15%) or working fewer hours/less over time (14%).

Matt Downie, Director of Policy and External Affairs at Crisis, comments: “We urgently need a financial package of support for the thousands of renters in arrears, especially with the end of the bailiff-led eviction ban fast approaching. 

“The financial impact of the pandemic has hit those on the lowest incomes, with the smallest savings the hardest. Unable to work or with their wages and hours cut, the number of people who have been unable to avoid building up rent arrears has tripled over the last year, reaching unprecedented levels” 

“They now face the very real prospect of being forced into homelessness, with the pandemic not over, unless the UK Government takes emergency action. 

“But renters need more than temporary lifelines of support. We urge the UK Government to bring forward the Renters Reform Bill in the Queen’s Speech next month and put in place measures to protect renters in the long-term.” 

Rent guarantee could help Universal Credit claimants find a privately rented home

Published On: April 21, 2021 at 8:47 am

Author:

Categories: Landlord News,Tenant News

Tags: ,,,,,

Universal Credit claimants find a privately rented home

A study has been undertaken to explore ways to encourage private rental sector (PRS) landlords to support tenancies from people receiving Universal Credit.

Rent guarantee and upfront cash payments from local authorities are most effective in opening up the PRS for people receiving benefits according to research from the Centre for Homelessness Impact, the Behavioural Insights Team and the National Residential Landlords Association (NRLA).

The research involved more than 2,700 landlords across England and Wales. It found that these approaches had the greatest positive impact on landlords’ openness to renting to people in receipt of these approaches had the greatest positive impact on landlords’ openness to renting to people in receipt of benefit. However, the overall willingness of landlords to rent to those in receipt of benefits still remained relatively low, highlighting the need for policy changes to be made to drive change.

Each participant was asked about different scenarios to understand how they would react and respond across two broad areas:

1. Whether disclosing additional information about a tenant has any impact on increasing landlord willingness to continue with the application of someone receiving Universal Credit

Landlords were sent information on:

  • Pre-tenancy training: A certificate of completion and schedule for a tenancy skills programme 
  • Budget planner: A table of the tenant’s income & expenditure 
  • Alternative payment arrangement (APA) leaflet: Information about APA, which is the process in England whereby housing benefit is transferred directly to the landlord (as opposed to being paid as part of the lump sum Universal Credit payment to the tenant) 

2. Which Local Authority incentives or support programmes are most effective at increasing landlord willingness to rent to someone receiving Universal Credit.

This considered:

  • £1,000 cash upfront: a cash payment upon signing a tenancy agreement; 
  • Rent guarantee: a written guarantee from the Local Authority that they will cover late or unpaid rent; 
  • Deposit bond: a cash amount equivalent to one month’s rent set aside to cover any costs a landlord may incur during the course of the tenancy; 
  • Support from a landlord liaison officer: a dedicated resource that acts as a single point of contact for private landlords who need support with a tenancy

Landlords who received information about budget planners, pre-tenancy training or APA reported very similar willingness to rent to potential tenants as those who received no additional information. This suggests that these are less effective at changing landlords’ attitudes than previously expected.

Significantly, the study indicates that the willingness of landlords to rent to people receiving Universal Credit remains low. Even with the strongest interventions, landlords’ willingness to let properties to people at risk of homelessness fell between ‘somewhat unlikely’ and ‘neutral’ (with neutral being the middle point of a 7-point scale).

Dr Ligia Teixeira, Chief Executive of the Centre for Homelessness Impact, said: “Taking an evidence-based approach to unlocking the private rented sector for people in receipt of Universal Credit who were previously less likely to gain access, is just one way in which we might end homelessness sustainably by focusing on prevention instead of mitigation.

“By making sure more housing options, including the private rented sector, are available to people who are in receipt of Universal Credit and at risk of homelessness, these trials help us move towards an environment where both landlords and prospective tenants have their needs met.”

Ben Beadle, Chief Executive of the NRLA, said: “The private rented sector can play a valuable role in providing longer term accommodation for those at risk of homelessness or struggling to maintain a tenancy. It is vital that policymakers heed the findings of this research to engage with landlords effectively and ensure they are confident that any risks they perceive will be addressed.

“As the research shows, the central element for landlords is continued rent payments. Government holds the key to this, through continuing to link local housing allowance to market rents, improving the administration of Universal Credit and better utilising guaranteed rent schemes at a local level. Without taking these vital steps, the Government will not tackle the homelessness crisis.”

Eva Kolker, policy lead for housing and homelessness from the Behavioural Insights Team, said: “This has been a great partnership with the Centre for Homelessness Impact and NRLA producing some really important results with policy implications for both central government and local authorities. Most research on reducing homelessness through the private rented sector focuses on tenant behaviour, but far less looking at landlord decision-making and behaviour. The participation of the NRLA in this partnership allowed us to run the UK’s first ever behavioural trial with landlords.”

UK landlords show increased interest in green buy-to-let mortgages

Published On: April 20, 2021 at 8:00 am

Author:

Categories: Finance News

Tags: ,,

Report highlights efforts by letting and estate agents to reduce carbon emissions

Three in every five landlords are now interested in green buy-to-let mortgages, according to research by Mortgages for Business.

62% of landlords responded to the buy-to-let (BTL) broker’s survey saying they are interested in mortgages that reward borrowers with discounted rates for making their properties more energy-efficient and shrinking their carbon footprint.

Jeni Browne, director of Mortgages for Business, comments: “Much of the UK’s housing stock is very energy inefficient, making our homes a major source of greenhouse gas emissions.  Improving the energy efficiency of the UK’s stock of housing is a priority in the fight against climate change.  

“A green mortgage means that, once they can confirm they have a revised energy rating for their property, the right lender will recalculate their mortgage rate at a discount.  There are various mortgage products out there but the best are applied on completion of an energy efficiency project and applied for the lifetime of a mortgage.  

“Given housing accounts for such a significant chunk of the UK’s carbon emissions, it’s great that landlords are so interested in making greener choices – spurred on, no doubt, by the fact landlords are rushing to upgrade their properties to meet new EPC rating rules by 2028.  Whatever the reasons, landlords now appear interested in joining the battle to combat climate change. That hasn’t always been the case.”

The results of this survey, which involved 300 landlords across the UK, showed none of the respondents who had acquired their first BTL property before the year 2000 had been interested in green mortgages at the time of purchase. Only 10% of the landlords who had acquired their first BTL property in the 2000s said they had been interested in green mortgages when they made the purchase.

Jeni Browne comments: “We started trading in 1990 and the findings of our poll match our experience of the market over the last 30 years. Landlords’ attitudes have changed dramatically, particularly in the last decade. Landlords should be interested in these products though – quite apart from the ethical considerations, green mortgages reward landlords with a lower rate when they shrink their carbon footprint.”

The research also found that less younger landlords were interested in green mortgages than older landlords. Only 50% of landlords under the age of 45 polled by Mortgages for Business said they were interested in green mortgages, compared to 66% of those over 45.

Jeni Browne comments: “Hopefully, our research will help drum up more lender supply. The UK’s largest lenders have launched a wave of climate-change products amid criticism over their slow response to global warming.  For instance, one of the big lenders did launch a Green Mortgage last year and we’ve seen others follow suit but have only offered borrowers preferential rates when they purchase an energy efficient property – rather than rewarding those improving the ecological footprint of the UK’s housing stock. It’s not enough and that’s why they have failed to impress campaigners.

“Given Britain has just enjoyed the greenest Easter on record, with almost 80% of the energy used at lunchtime on Easter Sunday coming from zero-carbon sources such as solar and wind, the industry is in danger of falling behind the times unless we do our bit.”

Having a garden could boost your property value by 5%

Published On: April 19, 2021 at 8:38 am

Author:

Categories: Property News

Tags: ,

boost your property value

According to a study by the AA, having garden space on your property can lift its value by 5%.

The study looked at homes with and without gardens in 30 towns and cities across the nation to see where gardens are valued the most. 

The COVID-19 pandemic has meant spending more time at home than ever before, and the company says that gardens have become a precious space to spend time in.

Properties in Brighton are worth £27,297 with a garden 

The study looked at the average house price for places with up to three bedrooms, along with how much people were charging on average for homes with gardens.

Overall, the study shows that the average home in the UK was valued at £209,525. However, the price of homes of the same size that had gardens hit an average of £220,555.

The top locations for a price bump include Walsall, where a house is worth 16% more if it had a garden, Sunderland, where it’s 15% more, and Liverpool at 11% more.

While those are the best places for garden value compared to the house itself, Brighton is where a garden is worth the most money. Compared to an average house price of £379,259, a home with a garden here is worth £27,297 more.

In the capital, however, the study shows that properties are actually cheaper with a garden. This is potentially due to the rise in new-build flats and penthouses pushing the average price of all properties beyond those with gardens, the AA says.

The top 10 cities where having a garden adds the most value to property prices 

RankLocationAverage Property Price Average House Price With a Garden Garden Price Increase Percentage Garden Price Increase 
1Walsall£ 155,059.24£ 180,614.96£ 25,555.7216%
2Sunderland£ 121,119.73£ 138,979.72£ 17,859.9915%
3Liverpool£ 158,772.81£ 176,427.64£ 17,654.8411%
4Leeds£ 205,103.01£ 223,762.44£ 18,659.439%
5Leicester£ 208,036.93£ 226,915.52£ 18,878.599%
6Derby£ 177,848.87£ 193,864.16£ 16,015.299%
7Milton Keynes£ 253,357.18£ 276,137.79£ 22,780.619%
8Bradford£ 128,186.02£ 139,270.00£ 11,083.989%
9Stoke-on-Trent£ 145,566.36£ 158,080.31£ 12,513.959%
10Belfast£ 137,601.70£ 149,355.74£ 11,754.039%

The top 10 cities where having a garden adds the least value to property prices 

Rank Location Average Property PriceAverage House Price With a Garden Garden Price Increase Percentage Garden Price Increase 
1London£ 730,940.57£ 702,379.81-£ 28,560.76-4%
2Glasgow£ 157,816.02£ 159,984.42£ 2,168.401%
3Wolverhampton£ 175,359.23£ 179,877.78£ 4,518.553%
4Bristol£ 295,125.12£ 303,546.65£ 8,421.533%
5Birmingham£ 221,221.16£ 227,600.63£ 6,379.473%
6Edinburgh£ 286,761.71£ 296,361.32£ 9,599.603%
7Doncaster£ 153,556.00£ 159,030.57£ 5,474.564%
8Dudley£ 181,284.56£ 189,671.67£ 8,387.115%
9Newcastle upon Tyne£ 155,092.26£ 162,581.01£ 7,488.755%
10Nottingham£ 200,404.34£ 210,209.32£ 9,804.995%

Two years have passed since Government pledged to end ‘no-fault’ evictions

Published On: April 16, 2021 at 8:23 am

Author:

Categories: Law News

Tags: ,,,,

168% increase in people facing eviction, Government figures show

This week saw the two-year anniversary of the Government making the decision to end Section 21 ‘no-fault’ evictions in the private rental sector.

According to a survey commissioned by Generation Rent, 8% of respondents have received a Section 21 eviction notice since March 2020, which would represent 694,000 private renters in England. 

32% of those surveyed are concerned they will be asked to move out this year, which would represent 2.78m private renters across England.

To support renters in their calls for change, the Renters Reform Coalition has been formed – a broad group of 20 leading charities, think-tanks, housing and renter organisations, who are committed to ensuring that private renters have a safe, affordable and stable home, where they can live and flourish.

The coalition has formed to ensure that the Government lives up to its promise and brings forward plans for a redesigned system that better serves the nation’s millions of private renters.

The Renters’ Reform Bill, announced in the last Queen’s Speech, outlined the Government pledge to end ‘no-fault’ evictions as well as making further changes to the private rental sector.

The Renters Reform Coalition outlines its recommendations for the Renters’ Reform Bill and beyond in the adopted policy principles on its website. These principles call for the necessary reforms needed to end ‘no-fault’ evictions and deliver stability, affordability and safety for renters.

Sue James, Chair of the Renters Reform Coalition, says: “Private renters face high rents, poor living conditions and perpetual instability. This causes needless disruption to people’s lives: their finances, work, health and their children’s education. Renters need certainty to enable them to put down roots in communities and create real homes in rented properties.

“Having been a front-line legal housing advisor for many years I have seen the difference that good quality, secure housing can make to people’s lives. We need to see people’s homes as more than just terms in a contract.

“The breadth of organisations that have come together to form the coalition highlights the importance of this issue. It is essential that reform of private renting is a key part of the government’s plans to improve the housing system. The Renters Reform Coalition has formed to ensure that the government keeps its promise. We welcome the opportunity to work with the government to create a renting system that is fair and fit for the future.”

Alicia Kennedy, Director of Generation Rent, said: “A Section 21 notice pulls the rug out from under you. As long as the landlord serves it correctly, you have to move out. That means very few tenants challenge it in court. And because landlords don’t need a reason for eviction, it also means that many tenants live in fear of losing their home and families throughout England have no confidence to put down roots in their local area.

“Renters have been waiting two years for the government to make good on its promise to ban these unfair evictions. If it weren’t for Section 21, 700,000 renters would not have faced an unwanted move during a pandemic and millions more would have confidence to plan their lives.”