Posts with tag: rent prices

Scottish Landlords Achieving Strong and Stable Rental Yields

Published On: October 31, 2017 at 9:51 am

Tags: letting agents,rent prices,rental yields,Scotland

The rental yields achieved by Scottish landlords remain highly competitive when compared to other asset classes, according to the latest index from Your Move Scotland.

The average rent north of the border reached £574 per month in September, which is broadly in line with the price recorded in August and in the same month last year.

Four of the five Scottish regions experienced rent price growth in the 12 months to September, led by increases in the Highlands & Islands, where prices are 5.6% higher than last year, hitting an average of £610 a month, which is significantly higher than the £576 seen in September 2016.

Scottish Landlords Achieving Strong and Stable Rental Yields

The next highest growth was recorded in Edinburgh & the Lothians, where the average rent rose by 4.5% in the past year to reach £669 a month, which is the highest average rent price in Scotland.

Glasgow & Clyde was the only region to witness a year-on-year rent price drop, with the average value down by 6% to £541 in September, from £579 in the same month last year.

According to Your Move, Scottish landlords achieved an average rental yield of 4.8% in September, which, although down slightly from the 4.9% recorded in August, is a significantly higher return than the majority of properties in England and Wales achieve, which is an average of 4.4%.

Only landlords with properties in the North East and North West of England enjoyed higher average yields than those in Scotland.

The Lettings Director of Your Move Scotland, Brian Moran, says: “With four of the five regions of Scotland showing price growth in the last 12 months, things are looking up for Scottish landlords. Returns remain highly competitive and landlords are enjoying greater stability from their tenants.”

However, Moran is urging all landlords in Scotland to prepare for upcoming changes to legislation.

From 31^st January 2018, the Letting Agent Code of Practice will come into force, and agents will have to declare themselves compliant with the new scheme.

Letting agents will be legally required to join a register of agents, and Your Move Scotland is calling on landlords and property investors to enquire with their current agent as to whether they are complying with the new rules.

Letting agencies must have submitted an application to join the Code of Practice by 30^th September 2018. From that point, it will be a criminal offence to conduct letting agency work if you are not on the register.

Those breaking the rules, which are intended to increase professionalism in the sector and ensure that agents are able to handle money from landlords and tenants effectively, could face a fine of up to £50,000 and up to six months’ imprisonment.

“The upcoming introduction of the Letting Agent Code of Practice means landlords should ensure their agent is ready for the changes,” Moran adds.

Rents Rising Fastest in the North West, Reports Your Move

Published On: October 27, 2017 at 8:41 am

Author: Em Morley

Categories: Property News

Tags: lettings market,rent price growth,rent prices,rental yields,rents

Rents Rising Fastest in the North West, Reports Your Move

Most areas of England and Wales have seen rent price growth over the past 12 months, with the North West seeing the fastest rising rents in the year to September, according to the latest Buy to Let Index for England and Wales from Your Move.

On a non-seasonally adjusted basis, the average rent charged to tenants was £938 per month in September. On a seasonally adjusted basis, the average rent price was £843 per month, which is higher than the £841 recorded in August and 3.2% up on the same month last year.

On an annual basis, the North West experienced the fastest rising rents, having increased by an average of 3.6% to reach £633 per month, followed by the East Midlands, where prices were up by 3.4% to £646, while the East of England completed the top three, with prices having jumped by 2.9% in the year to September to reach an average of £880.

By contrast, rents in the South West have dropped by an average of 2.2%, while the North East has seen prices decline by 0.3%. These were the only two regions to record a year-on-year decrease in September.

Unsurprisingly, London remained home to the highest rents in the country in September, at an average of £1,280 per month. However, this headline figure continues to mask vast differences across the capital.

The typical rental yield for landlords remained at 4.4% in September, which is down on the 4.8% recorded in the same month last year.

Properties in the North East enjoyed the highest yields, at an average of 5.1%. In the North West, the average return was 5.0%. These were the only two regions to record yields above the 5% mark in September.

The National Lettings Director for Your Move, Martyn Alderton, comments on the report: “Once again, the strongest rent growth was found in the areas away rom London and the South East. As activity in the capital slows, prices and activity have risen in the north.

“There was a stellar performance in the North West, with rents increasing by 3.6% over the year and landlords seeing a high yield rate of 5.0%.”

He adds: “Yield levels have started to stabilise across surveyed areas after being squeezed at the start of the year. This is good news for landlords and demonstrates the resilience of the sector.”

Surge in Rent Price Rises Comes to an End

Published On: October 26, 2017 at 9:03 am

Author: Em Morley

Categories: Lettings News

Tags: letting agents,rent prices,tenants

The surge in rent price rises seen over the last few months has come to an end, according to the Private Rented Sector Report for September from ARLA Propertymark (the Association of Residential Letting Agents).

Surge in Rent Price Rises Comes to an End

Rent price rises

After several months of rent price rises, the number of letting agents who saw landlords increasing costs for tenants dropped to 27% in September, from 35% in August.

Showing signs that the rental market is heading in the right direction, this is the first month-on-month decrease since May, when the figure also stood at 27%.

However, on an annual basis, the amount of tenants experiencing rent price rises is up – in September last year, just 24% of letting agents saw costs increase.

Demand for rental properties

Last month, there was an average of 79 prospective tenants registered per letting agent member branch – up by 10% on August, when there were 72 per branch.

Supply of rental stock

The number of rental properties managed per member branch remained the same on a monthly basis in September, at an average of 189.

This is down by 2% on September 2016, however, when agents managed an average of 193 properties.

David Cox, the Chief Executive of ARLA Propertymark, comments on the report: “Last week’s consumer price index (CPI) showed that inflation rose to 2.8% in September, up from 2.7% in August. As the cost of living increases, the last thing tenants need is for their rents to rise, so, while it’s great that month-on-month we’re finally seeing a decrease in the number of landlords hiking costs, we need to look at the bigger picture.

“There are still more than a quarter of tenants experiencing rent hikes every month – and that’s too high. As summer drew to a close in September, demand increased in line with our expectations, and, while it’s too soon to see the effect of this on rent costs, we know that when supply and demand are conflicting, rent prices will just continue to rise.”

Although the decline in the number of letting agents seeing rent price rises is good news, another recent report suggests that around a quarter of tenants are still paying over half of their earnings on rent every month.

Rent Price Growth Unchanged from Last Month, Reports ONS

Published On: October 18, 2017 at 9:06 am

Author: Em Morley

Categories: Property News

Tags: rent price growth,rent prices,tenants

Annual rent price growth across Great Britain was unchanged from the previous month in September, according to the latest index from the Office for National Statistics (ONS).

Rent Price Growth Unchanged from Last Month, Reports ONS

In Great Britain as a whole, the average rent price rose by 1.6% in the year to September. In England, prices were also up by an average of 1.6% over the same period, while Wales saw growth of 1.4%. In Scotland, the average rent price increased by 0.3% in the 12 months to September.

London rent prices grew by an average of 0.9% in the 12 months to September, which is 0.7 percentage points below the average rate recorded across Great Britain and down from 1.2% in August. The Royal Institution of Chartered Surveyors (RICS) reports that near-term expectations are still negative for the capital – an ongoing trend stretching back to August 2016.

Growth in private rent prices paid by tenants in Great Britain has seen signs of a slowdown since the end of 2015, the ONS reports. For example, a property that was let for £500 per month in September last year, which saw its rent increase by the average rate in Great Britain, would be let for £508 in September 2017. This slowdown has been driven mainly by a slowdown in London over the same period.

The annual rate of change for Wales in September (1.4%) is now similar to the annual increase for England and Great Britain (both 1.6%). Wales has seen a broad rise in its annual growth rate since July 2016.

Rent price growth in Scotland (0.3%) has now hit its joint highest rate since May 2016. This weaker increase may be due to stronger supply and weaker demand in the country, as reported by the Association of Residential Letting Agents (ARLA).

Focusing on the English regions, the largest annual rent price increases were recorded in the East Midlands (2.9%), up from 2.8% in August, the South East (2.5%), down from 2.6% in the previous month, the East of England (2.4%), up from 2.1% in August, and the South West (2.1%), unchanged on a monthly basis.

The lowest annual rent price rises were in the North East (0.4%), unchanged from August, London (0.9%), down from 1.2% in the previous month, the North West (1.3%), down from 1.4% in August, and Yorkshire and the Humber (1.6%), down from 1.7% in the past month.

Recent research claims that London tenants are now spending almost £1,900 per month on rent, despite the slowdown being seen in the capital.

Rent Prices Down Across Britain, Driven by the South

Published On: October 9, 2017 at 9:19 am

Author: Em Morley

Categories: Property News

Tags: lettings market,London,rent prices,South East

Asking rent prices have dropped across the UK in the third quarter (Q3) of the year, driven by declines in the south, according to the latest report from Rightmove.

Rent Prices Down Across Britain, Driven by the South

Historically, asking rents for new properties coming onto the market rise in Q3, as it is typically one of the busiest times for the lettings market. However, the latest Rental Trends Tracker from the property portal shows that rents are down, as supply starts to exceed demand.

The average asking rent was down by 0.2% in Q3, driven by a 2.3% decline in the South East, where rents were down for the first time in six years. Outside of London, the average asking rent is now £789, down from £790.

The Head of Lettings at Rightmove, Sam Mitchell, says: “Since last April’s second home Stamp Duty changes came in, the supply of new rental properties in the South East has been steadily increasing, up 5.5% on this time last year.

“Agents are reporting that some investors looking for better yields are shifting their focus from London to instead buy in the surrounding counties of Surrey, Berkshire and Buckinghamshire.

“The increase in stock in the South East has led to softening in rents in some areas where there is less competition among tenants, but they are holding up in key commuter areas where tenant demand is strong.”

In London, asking rent prices are at their lowest for this time of year since 2013, at an average of £1,920 per month, from £1,934 – down by 0.7%.

While the decline seen in the South East is due to increasing supply, the picture is different in the capital, where new listings were down by 3.7% on Q3 2016.

Mitchell adds: “Last year, the supply of rental properties in London increased as much as 26% when investors rushed to buy ahead of the Stamp Duty changes, leading to cooling rents over the last 12 months in the capital.

“Now, it appears that rental investors are starting to move their money away from London, with a number of agents across London saying that investors are being replaced by first time buyers. This is likely to constrict rental supply in the capital and lead to rents increasing again, so now would be a good time for prospective tenants to act, before this happens.”

In every region but the South East, London, and Yorkshire and the Humber (where rent prices dropped by a slight 0.2%), asking rents rose by up to 2.6%.

How Rents have Fared since Crossrail 2 was Announced, as TfL Hints at Decade-Long Delay

Published On: October 9, 2017 at 8:22 am

Author: Em Morley

Categories: Property News

Tags: Crossrail 2,London,rent prices

Since the Crossrail 2 route was announced in 2013, rents have been pushed up in 13 of the 15 affected local authority areas, according to the latest Rental Index from Landbay, powered by MIAC. However, as Transport for London (TfL) hints at a decade-long delay, how will the property market be affected?

How Rents have Fared since Crossrail 2 was Announced, as TfL Hints at Decade-Long Delay

Last week, a leaked business case from TfL to the Government revealed that Crossrail 2 could be delayed by a decade, as a funding shortfall jeopardises the final go-ahead from ministers.

As the future of the line is called into question, Landbay’s latest Rental Index reveals that a significant uplift in tenant demand in the four-and-a-half years since the route was announced has pushed up rents in 13 of the 15 affected local authorities, and by 21.5% around the north terminus of Broxbourne.

When the route for Crossrail 2 was first revealed in February 2013, rents were falling in seven of the 15 local authority areas set to house the new line. In the year that followed, a dramatic uplift in tenant demand saw rents grow in all but one, Epsom.

Overall, in the four-and-a-half years since the announcement was made, 13 of the 15 local authorities have seen notable rent price rises – most significantly in the north and west extremities of the line, namely Broxbourne (21.5%), Enfield (13.8%), Haringey (11.4%) and Spelthorne (10.5%).

However, while tenant demand indeed grew quickly until 2016, the Government has begun to drag its feet on the final approval of the new infrastructure project, and rents have once again begun to drop – almost across the board. Only Enfield saw rents grow in the past year (by 0.4%), although, by September, rents had fallen here too, by 0.2%. Meanwhile, Broxbourne (-1.75%), Richmond (-1.13%) and Spelthorne (-2.16%) are all showing signs of dwindling tenant demand.

As London rents return to growth in September – after falling for 15 consecutive months – there are signs that demand for rental housing could again be on the rise in the capital, putting further pressure on the Government to follow through on its pledge to release an extra £2 billion of Government cash for local authorities across the UK to build more affordable homes.

The CEO and Founder of Landbay, John Goodall, comments: “The idea of a north/south London railway dates back to the 70s, but it was only in 2013 that we found out where Crossrail 2 would actually run. Planned infrastructure is a key driver of tenant demand, so rents and property prices along the planned line quickly followed suit. But news that the line may now be delayed by a decade is nothing short of a hammer blow to all those that have had the foresight to plan that far ahead.

“What’s needed by tenants, landlords, buyers, business and builders is a clear commitment from the Government that the project will be delivered in 2033 as expected. Not only to help people and businesses plan their lives ahead, but also to allow adequate time for local authorities to plug housing shortfalls before demand spirals out of control.”

He adds: “For example, the latest £2 billion social housing pledge is an encouraging sign that the Government is taking seriously the UK’s housing shortage, but this could and should be linked to the UK’s infrastructure plan, to spare any nasty surprises down the track.”