Posts with tag: renters

Affordable rent to buy homes in Plymouth

Published On: December 3, 2015 at 11:01 am

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Details of the UK’s first affordable rent to buy homes on a development in the South West of England have been announced.

Housing companies Persimmon Homes and Rentplus, based in Plymouth, have both signed an agreement to develop 19 new affordable rent to buy homes in the city. It is hoped that this will assist in countering the region’s housing shortage and greatly help first-time buyers onto the ladder.

Development

These properties are part of a development of 139 homes built by Persimmon Homes on William Prance Road, Derriford, as part of Plymouth’s Council’s Get Plymouth Building scheme.

Chief Executive of Rentplus, Richard Connolly, said, ‘with average house prices in the South West now close to £230,00 and in some places more than £300,000 and average earnings in the region among the lowest in England, we have an unbelievable housing situation where many houses cost more than 10 times the average annual household income.’[1]

‘Rentplus is designed to make housing accessible for all those who wish to own their own home and we look forward to working with partners in Plymouth and across the country to help to tackle the housing crisis,’ he added.[1]

Affordable rent to buy homes in Plymouth

Affordable rent to buy homes in Plymouth

 

Affordable

The first set of homes are now complete, with Rentplus working with Tamar Housing Society to try to identify suitable tenants. These Rentplus properties are available at affordable rents up to 80% of the local market rent, for a period of between five and twenty years. Once this tenancy has concluded, tenants will be given the chance to buy their rental home, given an additional 10% deposit by Rentplus in order to achieve this.

Figures from the recently released South West Housing Initiative indicate that the region is the largest growing in the country. However, the area also has the largest housing crisis. Further research from the National Housing Federation shows that renters in the South West spend an average of 35% of their wages on rent. This is the third highest rent to income ratio in the country.

Julie Barnett, chief executive of Tamar Housing Society, thinks that it is critical to provide affordable housing to those who are most vulnerable. Encouragingly, she believes that, ‘these new homes go a long way towards helping to tackle the housing crisis we are currently seeing across the South West.’[1]

‘At a time when social landlords across the country are facing cuts, companies like Rentplus are offering an alternative, sustainable opportunity for long term tenancies and home ownership for residents without the need for any public subsidy,’ she concluded.[1]

[1] http://www.propertywire.com/news/europe/uk-buy-rent-homes-2015120211271.html

 

 

Rents in Prime Home Counties market down by 0.8%

Published On: October 28, 2015 at 10:01 am

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Prime market rents in the English Home Counties slipped by an average of 0.8% during the third quarter of 2015, despite boosted activity levels.

Annually however, rents are up 4.1% on the same period twelve months ago.

Seasonal

The prime rental market in the Home Counties tends to be seasonal, with the three months leading to September often the busiest of the year, with tenants looking to complete moves before the start of the next school year.

2015 saw no exception to the rule, according to new data released by Knight Frank, which shows the number of tenancies agreed in the three months to September was 54% higher than in the previous quarter.

While activity has remained robust, rising stock levels across the market have meant that some landlords have been willing to reduce rents in order to stay competitive.

Rents in Prime Home Counties market down by 0.8%

Rents in Prime Home Counties market down by 0.8%

Relocation, Relocation, Relocation

Research executive Oliver Knight noted that, ‘as ever, demand from individuals relocating for work continues to form a significant proportion of the market, especially in the prime commuter hotspots of Ascot, Cobham and Esher where corporate tenancies accounted for 42% of all deals agreed over the three month period.’[1]

‘This corporate demand for rented accommodation has been particularly strong from individuals working in the technology sector,’ Knight continued. ‘The share price of technology businesses has performed well this year, especially when compared to the banking and oil and gas industries.’[1]

Mr Knight also pointed out that the prime market continues to be attractive to international tenants with 38% of new renters during July in September coming from overseas.

[1] http://www.propertywire.com/news/europe/uk-home-counties-property-2015102711136.html

 

 

 

London rental market is stabilising

Published On: October 15, 2015 at 1:03 pm

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Call for rental housing strategy from Public Accounts Committee

Underlining the last quarter’s unexpected turnaround, the London rental market saw values increase by 4% across most of central and eastern parts of the capital.

According to a report by Benham & Reeves Residential Lettings, the substantial impact of stamp duty rates has led to a stronger rental market.

Gains

The Prime Central London market saw increases in the last quarter, on the heels of many months of stagnation. This growth has continued into the present quarter. Many of the tenants aiding the growth are overseas professionals, opting to rent long term. This is due to the cost of renting representing a survey in comparison to purchasing a home in high value region, as a result of the 12% top rate of stamp duty.

In the east of the capital, the rental market is strong, but for different reasons. Typically, renters in this area are likely to be British and of a younger age. Many of these tenants are choosing to rent as a lifestyle choice.

North London actually saw a fall in rental values during the last quarter. However, a number of proposed developments in the area have led to an increase in property supply.

London rental market is stabilising

London rental market is stabilising

Interesting

Marc von Grundherr, lettings director at Benham & Reeves Residential Lettings, commented, ‘from an investors’ perspective, it is very interesting to observe demographic changes.’ He feels, ‘one of the reasons the rental market tends to remain so strong in areas such as east London is because these areas attract Milennials who are continue to rent long term.’[1]

‘They’re simply not willing to scrimp and save for years to afford a deposit but prefer to ‘live for the moment’. This concept even extends to where they choose to rent: they’d much rather live somewhere central close to good bars and restaurants than commute in from more affordable areas.  For as long as East London remains hip and trendy, it will continue to attract good quality tenants,’ Grundherr concluded.[1]

[1] http://www.propertyreporter.co.uk/landlords/london-rental-market-bounces-back.html

 

 

 

Homeownership a dream for half of renters

Published On: September 18, 2015 at 9:15 am

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A depressing new report has revealed that over 45% of UK renters believe they will never be in a position to afford their own home.

The latest Post Office Money Mortgages survey found that of the 20 million people that are currently renting a property in Britain, nearly half expect to never get onto the property ladder.

Growing

What’s more, the average age that people now expect to take their first step onto the ladder is now 36, up one year on 2014. This expectation of having to wait until mid-thirties to own a property is shared across most would-be buyers, with those in the East Midlands most sceptical. In this region, people believe they will be 46 before they will be able to own their own property.[1]

Raising a deposit was found to be the largest barrier to potential property ownership, with UK renters believing that on average, it will take them eight and a half years to save enough. One in ten expect to have to wait for more than a decade.[1]

More cause for concern was shown with 28% of prospective home-buyers feeling that they will never be able to afford a deposit, unless their circumstances dramatically change. In addition, 17% cited that not being able to afford mortgage repayments is also a concern.[1]

Worrying

‘The average age at which non-homeowners expect to get a foot on the property ladder has increased to 36 over the past year, which is a worrying trend,’ said John Wilcock, head of mortgages at the Post Office. ‘It is clear that there is still a long way to go inspire confidence in the first-time buyers’ market, with nine million feeling they won’t ever be able to buy their own property. The size of a deposit is clearly the biggest hurdle that people face, with only 31% expecting to be able to raise the money alone,’ he added.[1]

Homeownership a dream for half of renters

Homeownership a dream for half of renters

In terms of raising a deposit, 31% of those looking to purchase a property said they would save the required amount alone. 25% said they would take advantage of the Government’s Help to Buy scheme, with 19% said they would rely on help from their partners. 13% said they would enlist the help of their parents.[1]

26% of respondents said they believe greater assistance for first-time buyers from the Government would be a help, with 24% saying lower interest rates would encourage them to buy in the near future. In addition, the re-introduction of no stamp duty for initial buyers would tempt 14% to buy.[6]

11% of respondents simply stated that they were happy with renting and the freedom that it brings, admitting they have no desire to own their own property.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2015/9/homeownership-a-distant-dream-for-nine-million-renters

 

 

North East homeowners better off than renters

Published On: September 7, 2015 at 11:45 am

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Homeowners in the North East who own their own homes are better off than those than rent in the region, according to new figures.

Data released by the Halifax show that homeowners in the area are £61 per month better off than renters, with the region going out national trends.

Gaps

According to the figures, the average North Easterner spends £520 a month to rent a house, in comparison to £459 for those who own one. This represents a difference of 12%.[1]

Only Scotland, the South West and London recorded larger differences within the UK. Just one year ago, the difference was just £8 per month, a difference of only 2%.[1]

In Britain, first-time buyers’ advantage over renters has slowed during the last 12 months. Summer 2014 saw renters paying £1018 on average more than buyers. Now, this figure is down to £670.[1]

Separate research from the Guardian has also shown the North East to be the most affordable place to live in Britain The report shows that Londoners spend an average of 12.2 times their income on property, in comparison to just 6.1 times in the North East.[1]

North East homeowners better off than renters

North East homeowners better off than renters

Hidden truths?

Ajay Jagota, of North East sales and lettings firm KIS, believes the figures do not tell the entire story. Jagota said that, ‘the North East is historically the most inexpensive place to buy a house in the UK-and this research shows it to be the most affordable too. Because of this, buying has always been comparatively cost-effective compared to renting. When you add to that recent developments like reductions in Stamp Tax, low mortgage rates and the government’s Help to Buy scheme lowering the cost of deposits, it’s really no surprise at all to see the cost of buying a property falling.’[1]

‘These figures don’t take away from the fact that the North East is undoubtedly the most cost-effective place to both buy and rent in the UK. Halifax’s research shows that North East buying costs are 32% below the national average, and renting costs 28% lower.There’s no reason at all to be put off renting. KIS research has shown that North East rents have remained the same for almost 18 months. House prices meanwhile have risen by over 5% in the last two months. Then of course there’s the unexpected costs of home ownership these figures don’t include – broken down boilers, insurance, you name it.’[1]

Mr Jagota concluded by saying, ‘when charities like Shelter talk about 17,000 tenants being bullied by their landlords, they forget to mention that that’s out of an overall total of over 9,000,000 renters.  Renting isn’t just the right choice for many people, it’s can be a very cost-effective one too.’[1]

[1] http://www.propertyreporter.co.uk/landlords/north-east-homeowners-61-a-month-better-off-than-renters.html

 

 

97% of homeowners to get tax-free income from April

Published On: August 19, 2015 at 11:08 am

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A new report has suggested that the upcoming Rent a Room Scheme will be beneficial to the vast majority of homeowners.

Research conducted by SpareRoom.co.uk shows that homeowners in 29 of Britain’s 30 largest towns and cities will be able to earn tax-free rental income when the scheme comes into effect in April 2016.

Rents

Data from the report shows that only rents in the capital are greater than the £7,500 eligibility threshold. Under the current scheme, those letting furnished rooms to lodgers below the £4,250 per year threshold must declare tax on earnings in 73% of the 30 largest towns and cities.[1]

Average rents in Aberdeen were found to be £520 per month, the highest in Britain outside of London. This means that a live-in landlord letting a furnished room to a lodger could earn £6,240. Brighton represents the next highest rent of £510, equivalent to £6,120 per year. From April 2016, when the threshold is raised to £7,500 per year, these earnings will be completely free.[1]

In terms of UK capital cities, the largest annual lodger increases over the past twelve months were in Cardiff, where rents were up by 10.7%. Edinburgh came in next with a 10% rise, with Belfast seeing growth of 8.7% and London 5.3%.[1]

Good news

‘The increase to the Rent a Room scheme threshold is long overdue, having remained fixed since 1997,’ said Matt Hutchinson, director of SpareRoom.co.uk. The extra cash could really help when interest rates rise and mortgage payments follow. It’s great news for renters too,’ he continued.[1]

97% of homeowners to get tax-free income from April

97% of homeowners to get tax-free income from April

‘In the midst of a housing crisis and with building levels lagging well behind required targets, the new Rent a Room Scheme threshold should incentivise more cash-strapped homeowners to let their spare rooms, increasing the supply of affordable accommodation and reducing the pressure on rents. It’s something we campaigned for over six years, so we were thrilled to get a call from the Chancellor’s office on budget day to let us know it was happening. Even if we build at the levels we need we’ll only increase housing stock by 1 or 2% a year so making better use of existing stock is vital,’ Hutchinson stated.[1]

Concluding, Hutchinson said, ‘It’ll be interesting to see what happens in the run up to April. It’s likely many will start taking advantage of the current tax break this tax year. Freeing up just 5% of the 19 million spare rooms in England alone would accommodate almost a million people, the equivalent of a city the size of Birmingham. Watch this space.’[1]

[1] http://www.propertyreporter.co.uk/landlords/97-eligible-for-tax-free-rental-income-from-april.html