Posts with tag: London

Short-Term Lettings Industry Vows to Stop Landlords Turning Homes into Hotels

Published On: February 22, 2017 at 11:15 am

Tags: Airbnb,London,short-term lets,short-term lettings

The short-term lettings industry, which includes Airbnb, joined local authorities and community groups at City Hall yesterday to discuss growing concerns about landlords turning homes into hotels.

Short-Term Lettings Industry Vows to Stop Landlords Turning Homes into Hotels

Around a quarter of London homes listed on Airbnb are believed to have been let for more than 90 days last year – many illegally and in breach of an act designed to prevent landlords turning much-needed housing into what have been described as hotels by Labour’s London Assembly housing spokesperson, Tom Copley AM.

According to Airbnb, 4,938 of its entire London home listings – 23% of the total – were let for three months or more last year, despite a law requiring anyone doing so to apply for planning consent.

But the firm is among those that yesterday reaffirmed its commitment to enforcing the 90-day limit during a meeting hosted by Tom Copley AM, which focused on the need to stop landlords letting their properties beyond the limit set by the Government.

Speaking after the meeting, Copley said that there is “clear consensus over the need to collaborate to stop short-term lettings sites being abused by professional landlords”.

Guidance issued by the Department for Communities and Local Government (DCLG) in 2015 removed the need for planning permission to rent out a room or property as temporary accommodation for less than 90 days per year. While the 90-day limit remains in place, local authorities say it is difficult to enforce.

Copley continued: “We know that some landlords are essentially transforming long-term homes into hotels without planning permission. This meeting showed that there is clear consensus over the need to collaborate to stop short-term lettings sites being abused by professional landlords.

“Local authorities just don’t have the resources they need to enforce the 90-day limit and so it falls to providers to step in. It’s hugely welcome that Airbnb have stuck their heads above the parapet. We need others in the industry to now follow suit and to work together on enforcing the 90-day limit, including sharing data with boroughs where necessary.”

He said: “There is no disputing the many economic benefits to Londoners of tourism that Airbnb and their counterparts create. We must ensure the costs don’t outweigh the benefits, by preventing commercial landlords from taking advantage of the system and putting even more pressure on our housing supply.

“It’s also crucial that hotels and the hospitality sector don’t face unfair competition from professional landlords setting up as hotels by the back door, avoiding taxes and regulations.”

He added: “Yesterday’s meeting was a positive discussion about the need to ensure hosts cannot break the law by letting out properties short-term for more than 90 days per year. However, effective enforcement hinges upon effective legislation from Government, and we need them round the table for any future discussion. I look forward to continuing this work with platforms, boroughs, community groups, the GLA and central Government to ensure short-term lettings are effectively regulated.”

House Price Gap Between London and England Doubled in 20 Years

Published On: February 17, 2017 at 9:22 am

Author: Em Morley

Categories: Property News

Tags: house price gap,house prices,London,property market

The house price gap between London and the rest of England and Wales has more than doubled in the past 20 years, analysis by Lloyds Bank claims.

House Price Gap Between London and England Doubled in 20 Years

Using data from the Land Registry, the lender found that the house price gap between London and the rest of England and Wales was 47% in 1996, but is now a huge 107%.

Back in 1996, the average house price in the capital was £105,266, compared to £71,433 in England and Wales.

At the end of 2016, the average price had soared to £578,381 in London, compared with £278,750 in the rest of the country.

The London Borough of Hackney has recorded the steepest growth in house prices in the capital over the last two decades, according to the data, up by a whopping 702%, to an average of £606,269.

This compares to an average increase of almost 450% for London, and 290% in England and Wales over the same period.

The Mortgage Director of Lloyds Bank, Andrew Mason, comments: “The past 20 years have seen substantial growth in house prices in London, especially in the most affluent areas of the City.

“The boom years between 1996 and 2008 saw the gap widening between house prices at the top end of the market and those in London’s inner and outer boroughs, creating two distinct markets – prime and mainstream.”

He continues: “However, whilst those boroughs at the top end have pulled away considerably from the rest of London and the country in terms of house prices, improved transport links to the City from the outer boroughs and the 2012 Olympic Games have meant that the boroughs directly benefitting from these have seen house price growth outpace the prime areas in recent years.”

Has the house price gap between London and the rest of the country had an effect on your property portfolio – whether it’s where you choose to invest, or how lucrative your investments have been?

How do London landlords compare to those in other regions?

Published On: February 16, 2017 at 3:23 pm

Author: Em Morley

Categories: Landlord News

Tags: Buy-to-Let,buy-to-let landlords in London,London,London landlords

An interesting piece of data released by the Council of Mortgage Lenders has revealed how London landlords shape up to those in the rest of the UK.

According to the report, those in London are likely to have greater disposable income, work full-time and become landlords and a younger age.

London Landlords

In London, around 50% of landlords have at least £1,000 monthly disposable income. Outside of the capital, just one-third of landlords report this kind of cash.

London landlords are 27% more likely to be in full-time employment and 37% less likely to be retired than landlords in the rest of the country.

In addition, they are 25% less likely to start as an accidental landlord and 50% more likely to become a landlord after moving in with a partner who already owns a home.

The typical age of a first-time landlord in London is 42, in comparison to 47 outside of the capital.

How do London landlords compare to those in other regions?

Properties Owned

In terms of property types, landlords in the capital are more likely to let out flats, with 79% owning this type of dwelling. 47% have houses to let, in comparison to 84% in the rest of the country.

60% of capital landlords own a single investment property, while 20% own two-similar to the demographic in the rest of the UK. In addition, landlords in London are just as likely to offer tenancies of more than 12 months than in other areas.

The use of a letting agent is more common in London, but landlords in the capital are less likely to opt to obtain full management through their agent.

Using a limited company is still relatively uncommon, both in and out of London. Just 6.2% of landlords in London have incorporated, as opposed to 2.8% outside of the capital.

£40k salary required to rent alone in London

Published On: February 16, 2017 at 10:00 am

Author: Em Morley

Categories: Property News

Tags: Buy-to-Let,London,London renters,renting in london

A new online estate agency in London has stated that a single person renting in the capital must earn a gross salary of at least £39,876.84 to cover accommodation and living costs.

Nested has established an index which looks at rental costs in 33 London boroughs, 15 UK cities and 72 cities worldwide. In London, to cover rental costs, a single person must earn £3,323.07 per month.

Rental Costs

For a family living in London, they must earn an average of £6,305.31 per month in order to cover rent and living costs. This equates to a gross salary of £75,663.72.

In order to work out the amount required to cover rents, Nested looked at the price per square metre based upon current market listings with the minimum space, as seen in guidelines from the Greater London Authority.

Calculations from the agency reveal that the least affordable borough to rent in the capital is Kensington and Chelsea. Rents per square metre here total £72.40 per month. As such, to afford to rent alone and cover additional living costs in Kensington and Chelsea, an individual must earn £9,736.55 per month, or £116,838.60 per year.

£40k salary required to rent in London

For a family of four to rent in this borough, a monthly income of £18,474.48 is required. This equates to an annual income of £221,693.76.

On the other hand, the most affordable London borough in which to rent is Bexley, where rents per square metre total £13.30 per month. To afford to rent alone and cover costs here, an individual must earn an income of £1,788.62 per month, or £21,463.44 per year. A family of four requires a monthly income of £3,393.79 or £40,725.48 per year.

A Quarter of London Tenants Still Spend Over Half their Wages on Rent

Published On: February 3, 2017 at 9:36 am

Author: Em Morley

Categories: Property News

Tags: London,rent prices,rental property,rents,tenants

A quarter of London tenants are still spending over half of their wages on rent, despite prices falling by an average of 1% at the end of last year.

The latest rental report from Spareroom.co.uk found that the average room rent price in the capital dropped from £755 a month to £748 at the end of 2016.

Rents in the capital widely stagnated over the past year, as an increase in the number of available homes provided London tenants with more choice and opportunities to negotiate.

A Quarter of London Tenants Still Spend Over Half their Wages on Rent

“Falling rents in London might sound like good news for renters, but they’ve got a long way to go before they’re genuinely affordable,” says the Director of Spareroom, Matt Hutchinson. “One in four house sharers now spends over half their salary on rent.”

Nowhere highlights this more than in the London areas where rental properties are in short supply. St Paul’s, in EC1, is the most expensive part of the capital for London tenants, with rents averaging £1,346 per month. This is almost three times more expensive than London’s cheapest postcodes, which are typically found in up-and-coming areas on the fringes of the capital.

The cheapest postcodes for London tenants

North London dominates the list of top ten postcodes for the cheapest homes, with rooms in Zone 4’s Upper Edmonton the least expensive of all, at an average of £530 a month.

Meanwhile, rooms in leafier and slightly further out locations, such as Winchmore Hill and Totteridge & Whetstone, cost renters £559 and £565 respectively.

Rent prices dropped by up to 5% in all but two areas on the list – Lower Edmonton in north London and Abbey Wood in southeast London, a soon to be Crossrail hotspot, where room prices have increased by 4%, to £541 per month.

However, as London tenants seek cheaper alternatives, demand in more affordable locations surges and prices are likely to rise in line with demand.

“As 2016 came to a close, we saw London rents peak and renters look to commuter towns around the capital instead of concentrating on central locations, as we’ve seen in the past,” Hutchinson comments.

London’s fastest rising postcodes

With rent rises of 8%, north London’s Southgate, in Zone 4, and southeast London’s East Dulwich, in Zone 2, are among the fastest rising postcodes in the capital.

East Dulwich is benefitting from the recent Overground extensions through Forest Hill on one side and Peckham on the other, which have led to southeast London increasing in popularity, and room rates rising accordingly, to an average of £662 a month.

Hutchinson adds: “The SE postcodes are still the cheapest in the capital, so are proving popular with young professionals looking for a balance of lifestyle and affordability.”

Southgate, at the top end of the Piccadilly Line, is starting to see an increase in demand, as rents in more central locations are pushing London tenants’ affordability to breaking point. Room rents of £613 are a much more appealing prospect, as is having a better change of getting a seat on the Tube!

Landlords seeking investment properties in the capital should look to the areas that still prove affordable for average London tenants – you will be guaranteed a high level of demand and strong capital growth in areas undergoing improvements.

Renters being pushed out of London due to record rents

Published On: January 27, 2017 at 10:37 am

Author: Em Morley

Categories: Property News

Tags: Buy-to-Let,London,rental values in London,renters

Despite the growth in rental values in London slowing recently, the capital remains by far the most expensive region to rent in the country.

As such, a large number of Londoners renting property in the South of England has risen sharply, as more tenants are leaving London to try and get more value for money elsewhere.

Record Highs

With rents in the capital reaching record highs, many renters have been convinced to seek more space and value in other regions of the South. More specifically, these renters are looking to rent in areas offering a commute back to London and proximity to amenities such as good schools.

Michelle Niziol, Managing Director of IMS Property Solutions observed: ‘Growth in rent in the South of England is being fuelled partly by an increase in the number of people who are leaving London, seeking more affordable areas within the commuter belt. This is particularly so for young professionals and families and is likely to continue in 2017 and the foreseeable future.’[1]

Renters being pushed out of London due to record rents

‘More than four million households rent privately in the UK and this figure is set to grow as people continue to struggle to get on the housing ladder. However, there is also the growing trend of people choosing to rent rather than buy because of the flexibility it offers them. This means that despite the Government having announced a series of policy changes aimed at landlords, investing in bricks and mortar will still remain a worthy asset class for investors,’ Niziol added.[2]

[1] https://www.landlordtoday.co.uk/breaking-news/2017/1/high-prices-push-renters-out-of-the-capital