Posts with tag: rent prices

Rent Prices Edge Up, Led by Gains in Regional Hubs

Published On: December 18, 2018 at 9:00 am

Rent prices across the UK edged up in November, led by gains in the country’s regional hubs, according to the latest report from Landbay.

The buy-to-let lender found that rent prices rose by an average of 0.97% in the 12 months to November, which is virtually unchanged from the level of growth recorded during the same point of 2017.

However, rent prices in the UK’s regional hubs are growing significantly faster than both London and the UK average, particularly in the north of England, as workers continue to relocate from the capital, Landbay reports.

Rent growth in November was led by Leeds, where the average price was up by 2.54% over the year, followed by 2.05% in Birmingham and 1.91% in Manchester.

John Goodall, the CEO and Co-Founder of Landbay, says: “The truth is, there is now a twin speed rental market, as London’s rent growth is dwarfed by cities such as Leeds and Manchester. This is being fuelled by the capital’s millennial exodus, as countless young professionals realise there is more to life than London. This same message carries weight with landlords, who are increasingly seeing the value of investing in these regional hubs.

Rent Prices Edge Up, Led by Gains in Regional Hubs

“In many ways, it could be argued that the northern powerhouse is beginning to take effect amid stretched affordability and a harsher tax regime.”

In November, the average UK rent stood at £1,212 per month, which is up by £10 since the start of the year, owed in part to London’s improved performance, recording growth of 0.58% this year.

Rent prices are rising in 27 out of the 33 London boroughs, which is a very different picture from this time in 2017, when rents were declining in 26 of the capital’s boroughs.

When London is removed from the picture, the average rent in the UK was £769 per month in November, which has increased from £761 since the start of 2018.

The East Midlands (2.25%), Yorkshire and the Humber (1.50%) and the West Midlands (1.48%) have all experienced the most substantial growth over the past year, and are expected to climb further as we head into 2019.

Growth in the North East peaked to its highest point in two years in November 2017, but, since then, rent price inflation has depreciated to 0.05% on an annual basis – its lowest growth rate since August 2013.

Every region of the UK saw rents increase last month, but it is worth noting that the speed of growth has not been consistent, with all areas other than London experiencing a slowdown.

Goodall adds: “London’s green shoots paint a positive picture for landlords ahead of what will likely be testing economic times, with Brexit and further interest rate rises expected.”

London Needs Rent Controls, Insists Sadiq Khan

Published On: December 11, 2018 at 11:09 am

Author: Em Morley

Categories: Lettings News

Tags: housing crisis,London,rent prices,tenants

The capital needs rent controls in order to stabilise its private rental sector, according to the Mayor of London, Sadiq Khan.

Khan has hinted that he is considering introducing rent controls across the capital in a radical overhaul of private rental laws.

The Mayor told Labour MP Karen Buck that London needs to adopt a “strategic approach to rent stabilisation and control”, as the arguments in favour of capping rent inflation are becoming “overwhelming”.

Although national legislation governs private tenants’ rights, tenancies and rent prices themselves, it is understood that Khan will begin to advocate for fundamental change in order to tackle overinflated rents, in a move that could lead to councils assuming greater powers.

In a letter to Buck, he wrote: “I agree with you that London needs a strategic approach to rent stabilisation and control.

“I have long advocated such reforms; in 2013, I suggested reforms could give renters the right to longer-term tenancies and predictable rents. The housing crisis is now having such an effect on a generation of Londoners that the arguments in favour of rent stabilisation and control are becoming overwhelming.”

The proposed changes include ending Section 21 evictions, which tenant lobby group Generation Rent claims have been the leading cause of statutory homelessness since 2012.

London Needs Rent Controls, Insists Sadiq Khan

“This law allows evictions with no reason needed, and this is one more reason why we should scrap it,” the organisation said.

Assured Shorthold Tenancies, which are the standard rental agreements for almost all tenants in England, should be replaced with open-ended tenancies, providing greater security of tenure to renters, according to the draft blueprint.

Currently, landlords are able to evict tenants immediately after the initial fixed term – usually six months – without a legal reason.

Rent controls have been entirely dismantled in the UK, despite existing in some form for most of the 20^th century, in a process of deregulation that has helped drive sustained rent increases far above inflation.

Further measures to reverse this trend will be laid out in Khan’s London Model, which is due for release in spring 2019.

David Smith, the Policy Director for the Residential Landlords Association, responds to Khan’s claim: “It is curious that the Mayor is considering introducing rent controls at a time when rents in London are falling, according to official data.

“The Labour Party in Wales has previously rejected rent controls, arguing that they reduce incentives to invest in new property when we need more and lead to a reduction in the quality of housing. The same would be the case in London.”

He continues: “All evidence around the world shows that, where forms of rent control are in place, decoupling prices from the value of properties hurts both tenants and landlords.

“In the end, what is needed is a relentless focus on boosting the supply of housing.”

In 2013, Khan suggested that new measures could help tenants assume the right to longer-term tenancies, which would make rent prices more predictable.

In his manifesto for the 2016 London mayoral election, Khan recognised that the biggest issue he faced was the capital’s housing crisis.

He said: “I will fight for the mayor and London councils to have a greater say in strengthening renters’ rights over tenancy lengths, rent rises, and the quality of accommodation.”

Scotland has recently taken steps to introducenew housing regulations, while rent controls across some of Europe’s capital cities have been credited with preventing sudden price rises.

Amount of Buy to Let Tenants Negotiating Rent Reductions is Increasing

Published On: December 7, 2018 at 11:23 am

Author: Em Morley

Categories: Tenant News

Tags: rent prices,tenants

According to figures from ARLA Propertymark, the number of buy-to-let tenants successfully negotiating rent reductions increased significantly in October. Current figures for the number of tenants successfully negotiating rent reductions has increased by 85%.

However, proportionally the number of tenants having successfully negotiating rent reductions is still low. The figures place the percentage of tenants negotiating rent reductions from 2% in September to 3.7% in October.

This could indicate that, despite there perhaps being more grounds than ever before to negotiate a decrease in rent prices, particularly in certain areas where supply of rental properties is outstripping demand, this is still just a bump in the road of rising rents across the private rental sector.

However, figures do suggest that the number of buy-to-let landlords putting rents up has in fact dropped to the lowest level in seven months. The number of tenants experiencing rent increases fell for the second month running in October, with 24% of agents reporting that landlords increased rents, compared to 31% in September and 40% in August.

The rise in the number of rental properties available could have contributed to improving the chances of tenants negotiating rent reductions. ARLA Propertymark has found that their number of rental properties has risen from 194 in September to 198 in October. This is also the highest figure seen since December 2017, when supply was at 200 properties, and is up by 9% year-on-year.

ARLA Propertymark Chief Executive, David Cox, said: “Last month’s findings indicate that power in the rental market could be shifting towards tenants, with a record number negotiating rent reductions, and less landlords hiking rent costs. However, it’s more likely that this is indicative of the time of year and come the New Year, we’ll see rent prices starting to creep up again.

“There’s no real way of avoiding it unfortunately – with landlords facing continued regulatory change, increasing costs will be passed on to tenants. Those who don’t pass the costs on will eventually have to exit the market, which will increase competition and boost prices. It’s the ultimate ‘lose, lose’ situation.”

Scottish Rental Sector Records Positive October

Published On: November 30, 2018 at 10:23 am

Author: Em Morley

Categories: Lettings News

Tags: rent prices,rental yields,Scotland

The Scottish rental sector recorded a positive October, but this masks wide variations between the five Scottish regions, according to Your Move Scotland’s latest Rental Tracker.

Your Move Scotland found that the average rent price in the nation was £573 per month (seasonally adjusted) in October. On a non-seasonally adjusted basis, the average rent was £582.

The fastest rent price growth in October was seen in the Highlands and Islands, closely followed by the Glasgow and Clyde region. Meanwhile, declines were recorded in the East and South of Scotland regions.

Growth in Highlands and Islands

It was once again a divided picture for Scotland, with some regions recording strong growth, while others showed more modest growth or slight declines.

The Highlands and Islands was yet again the most expensive part of Scotland to rent a property, Your Move Scotland found, with the average property let for £698 per month in October. The new campus at the University of Highlands and Islands continues to attract people to the area. Similarly, Inverness Airport, where low-cost airlines operate, encourages travel both to and from the Highlands.

This region recorded the largest rent price growth of the 12 months to October, with the average property costing 14% more than it did in the same month of 2017. As such, there has been a noticeable increase in the number of English landlords buying in the area.

The next fastest growth was in the Glasgow and Clyde region. Prices here rose by 13% in the year to October, to hit an average of £613 a month. It is the third most expensive place to rent in Scotland.

Sandwiched between the two aforementioned areas is the Edinburgh and Lothians region. Prices here averaged £684 per month, following growth of 2.1% in the past year.

Each of the remaining regions saw their rent prices drop on an annual basis.

In the East of Scotland, rents fell by 1.7% year-on-year, to hit £529. The East is the cheapest region to rent in the country.

Scottish Rental Sector Records Positive October

Finally, in the South of Scotland rents dropped by a huge 4.4%, taking the average price down to £535 per month.

When all regions are considered, the average rent price in Scotland rose by 0.2% in the year to October.

On a monthly basis, all regions were flat or saw rising average rent prices. The only region to buck this trend was the South of Scotland, where prices ticked down by 0.5%.

Letting Agent Code of Practice

Landlords should be aware that new regulations affecting the way that letting agents in Scotland are able to conduct business on their behalf are now in place.

The Letting Agent Code of Practice was introduced on 31^st January 2018, and all agencies were required to sign up to the new scheme by 30^th September 2018 if they wished to continue operating in the sector.

Now, it is a criminal offence to conduct letting agency work if you aren’t on the register. Those breaking the rules could face a fine of up to £50,000 and up to six months’ imprisonment.

These rules are intended to increase professionalism in the sector, and make sure that agents are properly able to handle money received from both landlords and tenants.

Your Move Scotland encourages landlords to check that their agent is registered and is compliant with these new rules, given that they are now in place.

Rental yields are stable

The average property investor in Scotland enjoyed a rental yield of 4.7% once again in October, according to the Rental Tracker. This is the same return as in September, but is slightly lower than the 4.8% recorded in October last year.

Despite the annual decrease, the returns enjoyed by landlords in Scotland continue to compare favourably to the yields achieved in England and Wales.

Across both nations, the average rental yield was 4.3% in October. The individual regions of England to post stronger returns than the Scottish average during the month were the North East (5.0%) and North West (4.8%).

Decline in tenant arrears

There was a small drop in the number of tenancies falling into rent arrears in October, Your Move Scotland reports.

10.4% of all tenancies faced financial difficulties of some kind last month, which is down on the 11.0% recorded in September.

On an absolute basis, the number of rental households in serious arrears – defined as two months’ or more – was 9,815 in October.

Brian Moran, the Lettings Director of Your Move Scotland, comments: “Perhaps it is the breathtaking scenery tempting people out of the city, but the demand for properties in the Highlands and Islands has grown strongly in recent times.

“Last month, it toppled Edinburgh and Lothians as the most expensive region and, in September, its excellent performance continued.”

He adds: “Landlords continue to enjoy strong returns on their investment, particularly when compared to investors south of the border. An average return of 4.7% is also strong when compared to other forms of investment.”

Record Number of Tenants Negotiating Rent Reductions

Published On: November 30, 2018 at 9:01 am

Author: Em Morley

Categories: Tenant News

Tags: rent prices,tenants

A record number of private tenants negotiated rent reductions from their landlords in October, according to the latest Private Rented Sector Report from ARLA Propertymark (the Association of Residential Letting Agents).

Rent reductions

The amount of private tenants successfully negotiating rent reductions jumped from just 2% in September to 3.7% in October, the study found. This is the highest figure seen since ARLA Propertymark’s records began in January 2015.

In line with this, the number of tenants experiencing rent increases from their landlords fell for the second consecutive month in October, with 24% of ARLA Propertymark member agents reporting that landlords put their rent prices up, compared to 31% in September and a huge 40% in August.

Rental stock

The supply of available properties to let rose from an average of 194 per member branch in September to 198 in October.

This is the highest figure recorded since December 2017, when supply stood at 200 properties per branch, and is up by 9% on an annual basis.

Tenant demand

Demand for properties from prospective tenants increased in October, with the number of home hunters registered per ARLA Propertymark member branch rising to an average of 71, compared to 63 in September.

David Cox, the Chief Executive of ARLA Propertymark, says: “Last month’s findings indicate that power in the rental market could be shifting towards tenants, with a record number negotiating rent reductions, and fewer landlords hiking rent costs. However, it’s more likely that this is indicative of the time of year and, come the New Year, we’ll see rent prices starting to creep up again.

“There’s no real way of avoiding it, unfortunately – with landlords facing continued regulatory change, increasing costs will be passed on to tenants. Those who don’t pass the costs on will eventually have to exit the market, which will increase competition and boost prices. It’s the ultimate lose-lose situation.”

Tenants Could Save £64 for Each Extra Commuting Minute by Moving out of London

Published On: November 29, 2018 at 9:56 am

Author: Em Morley

Categories: Tenant News

Tags: London,rent prices,tenants

Families renting homes in London could save up to £64 for each extra commuting minute by moving out of the capital, according to research by AnyVan.com.

The study has used the average price of renting a three-bedroom family home in the capital, against a similar property in a commuter town.

The cost of renting in London is particularly high, especially for families. For those who work in central London, adding just a few minutes to a commute can save hundreds of pounds each month.

So, where could you move to that gives you a similar commute time, plus a similar sized home?

Tenants Could Save £64 for Each Extra Commuting Minute by Moving out of London

Woking offered the greatest saving per minute. There are a number of rental properties close to Woking station and, with its quick train link to Waterloo, the commute time from your front door could be as little as 28 minutes. There are decent savings to be made – roughly £191 per month in comparison to living in Colliers Wood, which can have a 25-minute journey into Zone 1. This means a saving of £64 for each minute added to the commute time.

St Albans is another known commuter hotspot, with a non-stop service into the capital. Commuting from a property close to the main station to Kings Cross takes just 23 minutes, which is actually only five minutes more than if you lived up the Victoria Line in Walthamstow. This switch could see tenants save £31 per minute, with a monthly saving of £157.

The highest potential monthly saving was £589, found by moving from South Clapham to Berkhamsted. A similar saving could be gained by switching homes in southwest London, such as Gunnersbury, to Reading. If you’re looking at Reading, be sure to check out Caversham, which offers a village feel, but is just a few minutes’ walk from central Reading and the mainline station. A short walk and direct train into London will take just 31 minutes, and could save commuters £39 a minute, or £545 per month.

A lesser-known option is Haddenham, a small village close to Thame on the border of Oxfordshire and Buckinghamshire. Haddenham offers a direct fast train service, which gets you into Marylebone in less than 40 minutes. This commute would add just seven minutes to your journey when compared to travelling in via the Bakerloo Line from Kenton. This switch would save £45 per minute, or £315 a month.

Other locations highlighted in the research include Bedford, against Edgware, which had a saving of £45 per minute. Seven Oaks was just four minutes longer than Tooting Bec, with a saving of £39 a minute. Kings Langley offers a commute of 29 minutes into Euston, versus West Finchley, at 22 minutes. This seven-minute difference could save tenants £41 per minute.

Angus Elphinstone, the CEO of AnyVan.com, says: “Our research highlights just how much money families who are renting in London could save by moving to a commuter town. Locations like Reading, St Albans and Woking offer rapid direct train links, and give movers an option to save money by adding just a couple of minutes to their journey time, in comparison to living in Zone 3 or 4.

“Commuter train tickets can cost upwards of £500, which might seem a bit steep for some, but, even with the additional travel costs, families can easily save £500 a month by switching London to a commuting hub.”

He adds: “Our advice before you move anywhere is: always do your homework and research the area. We’ve selected areas with available rental properties within a few minutes’ walk to the train station, as using a car park could add a further £100 per month to a commute.“

Landlords, you can use this research to inform your decisions when looking at property investments outside of the capital.