Housing Market

News covering issues affecting the UK residential property market, house prices, interest rates and buying and selling trends.

  • build-to-rent
    Latest property news

    L&G lays into agents as its first build-to-rent development opens

    Legal and General (L&G) has opened its first build-to-rent (BTR) scheme in the UK at a site overlooking the River Irwell in Salford, Manchester (pictured, right) where tenants will pay no moving in fees and a significantly-reduced deposit compared to traditional lets. The insurer, which is one of the UK’s best-known financial firms, set itself directly in competition with traditional letting agents and property managers at the launch. “For too long renters have found themselves at the mercy of expensive moving fees, unresponsive managers, and private landlords who often want to minimise upkeep costs and maximise rents,” says Dan Batterton, BTR Fund Manager at LGIM Real Assets (pictured, left). The Salford BTR development, called the Slate Yard, officially opened today and the first tenants are due to move in later this week, where L&G claims they will enjoy a lifestyle that many home owners would struggle to achieve. Build-to-rent As well as a fee-free move into the property and a low deposit, the building is served by a 24-7 on-site maintenance and management team, has free WIFI and free membership of a car club. L&G says these benefits will save tenants approximately £150 a month. Electricity and heating for the building…

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  • landlords
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    Rents drop across the UK as government measures hit landlords

    Rents are tumbling across many parts of the UK according to the latest rental index from referencing firm HomeLet, whose Chief Executive has questioned the wisdom of recent government measures to reduce landlord appetite for investment. HomeLet says rents fell in the UK by 0.3% last month, the first time this has happened since late 2009 and that rents in London have dropped by 3% over the past year from £1,572 a month last July to £1,502 a month in May. “May 2017 saw average rents nationally fall for the first time in eight years when the economy had suffered the shock of the financial crisis,” says Martin Totty, Chief Executive of HomeLet (pictured, left). “[Our] rental data suggests landlords are now facing a difficult balancing act between ensuring rents are affordable for tenants in a low real wage growth environment whilst covering their own rising costs. “Tenants will still need a vibrant and growing rented sector to provide them with property options at the time of their choosing. “Any constraint to the supply of rental properties, because landlords are unable to achieve the reasonable returns they require, cannot be in the long term best interests of tenants, especially if,…

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  • Latest property news

    Mandatory three-year tenancies questioned by leading lettings agent

    The UK’s largest lettings agency Belvoir has set itself against all the mainstream political party manifestos and the Association of Residential Letting Agents (ARLA) by questioning the need for mandatory three-year tenancies. The Conservative Party seeks to “encourage landlords to offer longer tenancies as standard” while Labour goes much further, saying it will “make three-year tenancies the norm with an inflation cap on rent rises”. The Liberal Democrats advocate “longer tenancies of three years or more with an inflation-linked annual rent increase built in to give tenants security”. But Belvoir’s latest lettings index shows that 43% of tenants who rent through its branches stay for between 13-18 months, 29% for between 19-24 months and only 18.2% for more than two years. ‘Question the need’ “Looking at the manifestos of all political parties it would seem that all are looking to introduce three-year mandatory tenancy agreements although [our] figures question the need for this as our tenants can already rent with confidence, and most opt to leave when they wish to do so,” Belvoir says. But not all landlords agree with Belvoir’s point of view. As we reported last week, one of London’s largest Build to Rent landlords recently scrapped deposits…

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  • Parliamentary debate on Letting Fees image
    Housing Market

    Govt lettings squeeze drives up rents as landlords exit

    The number of properties available to rent has fallen and prices are rising as the government’s recent Stamp Duty and tax allowance changes take their toll on the the lettings market, says franchise giant Belvoir. “Belvoir’s Q1 rental index, which is prepared for us by property expert Kate Faulkner, has identified some interesting trends, which we believe are a direct result of recent changes to BTL legislation,” says Belvoir’s Chief Operating Officer, Dorian Gonsalves. This includes that the number of landlords bringing between six and ten properties to the market has declined while the number of landlords bringing up to three properties to market remained static. Dorian says the reasons for this include additional Stamp Duty for buy-to-let property buyers and the radical changes to the way mortgage interest tax relief is calculated, which has reduced or cancelled out profits for many landlords. Lettings To counter these measures, Belvoir says, landlords are seeking the highest rental prices for their properties and driving up rents across the UK which have risen year-on-year by 5.75%. “Since 2008 [when Belvoir began its index] rents have moved broadly in line with wages and large movements over and above +/-5% rarely happen,” says Belvoir’s Chief…

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    General election reduces ALL housing market indicators

    Not many agents have thanked Theresa May for holding a general election during the crucial summer months, and now the extent of the damage being caused by the campaigning is laid bare. All the UK’s housing market health indicators fell last month which, according to NAEA Propertymark which compiled the figures, is “most likely down to uncertainty triggered by the snap General Election starting to take effect, as buyers put their plans on hold until the result is clear”, it says. House hunter number fall This includes the number of house-hunters in the market which fell by 4% to 381 per branch, property supply per branch which dropped by 8% to 36 per branch, and the number sales agreed per branch. This fell from ten per branch in March to eight in April. This is the third April in a row during which politics has conspired to dampen down the housing market after last year’s EU Referendum – which had the hardest impact on the market – and, before that, the 2015 General Election. For example, during the EU Referendum the number of house hunters dropped to 325 per branch, 17% lower than the current figure of 381. “Periods of…

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  • buy to let tax lord flight
    Latest property news

    Buy-to-let tax squeeze should be “scrapped” says high profile Tory peer

    A former Tory grandee has criticised the government’s recent buy-to-let tax tax squeeze, describing it as “ill conceived”. Former Tory vice-chairman and shadow Vice Secretary to the Treasury Lord Flight (pictured, right) has called for the government to scrap many of the recent taxes on landlords and “provide the support needed to the individuals and small businesses who make up the vast majority of the country’s landlords”. Stifling investment His comments were made on the Conservative Home website over the weekend, in which he also calls for the recent hike in Stamp Duty on buy-to-let purchases and reduction in reliefs to be scrapped because they are “stifling investment, as anyone could have predicted” and catching out “natural Conservative voters”. “The decisions to impose a stamp duty levy on the purchase of homes to rent out, coupled with restricting mortgage interest relief to the basic rate of income tax and the decision to tax a landlord’s turnover rather than profits, are causing many landlords simply not to invest further in much needed new homes to rent; or even to consider leaving the sector altogether,” he says. “The mortgage interest restrictions need to be scrapped, and the stamp duty levy needs also…

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    Large London landlord scraps tenant deposits

    A London Build to Rent landlord which owns the former Olympic athlete’s village in London is to stop asking for tenant deposits. Get Living London, which is also due to open a site in Glasgow and rents out approximately 1,500 homes at its East Village London site (pictured, right) says its tenants will no longer have to pay any deposit. Tenants can also sign up for a more secure three-year tenancy and already do not have to pay any fees at any point in their tenancy. “Where we have led – with no fees and longer tenancies – others have followed. We hope deposit-free renting becomes the norm,” says Get Living London CEO Neil Young (pictured, left). The company has also scrapped any fees and tenants are able to break their tenancy agreement after six months without penalty. But tenants do pay interest at 4% on any overdue rent and must also pay for the apartment to be cleaned when they move out, its sample contract says. Also, the deposit-free deal is only available to tenants who pass referencing, the cost of which is paid by Get Living London. Get Living London is also to return existing tenant deposits, worth…

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    Letting fees ban will be forgotten, says Generation Rent

    Campaigning group Generation Rent says it is worried that Theresa May’s manifesto promise of a letting fees ban is likely to be kicked into the long grass by the hung parliament and the pressures of Brexit negotiations. The government’s consultation on the ban closed on 2nd June. Generation Rent says it is concerned that, despite all-party support for a lettings fee ban, is believes the legislation is likely to “fall down the political agenda”. General Election It also says renters were a key reason for the Conservative’s poor performance during Thursday’s General Election. It has looked at the results and concluded that 20 of the 32 seats that the Government lost were areas where there is an above-average proportion of voters who are renters. This includes some of the election’s more high-profile upsets such as Portsmouth South, Reading East, Battersea and Croydon Central, where former housing minister Garvin Barwell’s lost his seat. Barwell didn’t have to worry about getting a job after the election, though, unlike many other Conservative MPs voted out during the election. He is now Theresa May’s new Chief of Staff. “As the Prime Minister prepares her legislative programme, she should bear in mind that most of the…

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  • rightmove general election
    Latest property news

    Sales agreed, prices and time to sell increasing despite election, says Rightmove

    This summer’s election campaign is having a less corrosive effect on sales levels than two years ago when David Cameron made his bid for power, Rightmove has claimed. Its monthly house price index reveals that the number of sales agreed so far this year is 2% higher than during the lead up to the 2015 general election. Rightmove also reckons that the number of days it takes to sell a property is reducing too, down from 79 days in January 2017 to 60 days in April 2017. The reduction is even sharper in London, where in January it took 71 days to sell a home, compared to 53 days in April. Stock levels are rising too, Rightmove says. The number of properties for sale per agent has risen from 52 in January to 57 in April. House prices are also rising, the portal’s index reveals, increasing during April by 1.2% or £3,626 on average, the fifth consecutive rise. All-time high “Whilst all-time high asking prices or economic and political uncertainty could be deterrents to would-be home-buyers, this month shows another strong set of figures,” says Rightmove’s spokesman and director Miles Shipside (pictured, left). “Demand is exceeding supply in many parts of the country…

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  • Latest property news

    Gazumping is back as market grows more competitive, says Sarah Beeny

    The lack of stock within the market is leading to an outbreak of bidding wars among buyer for the properties that do come on the market, research has revealed, and that gazumping is on the rise. Online agent Tepilo surveyed 2,000 home buyers and discovered that 23% had been involved in bidding wars, and that 19% had paid over the asking price to secure their preferred home. The-dog-eat dog nature of the market is also evident in the research – which reveals that 86% of those surveyed believe the housing market is competitive and that 16% had been gazumped and 14% lost out to a rival during a bidding war. Buying costs And perhaps predictably given the research is from Tepilo, the results show that 26% of respondents thought the significant costs of buying and selling a home were also “factors that make it competitive”. “This survey reveals the competitive nature of the UK housing market and how it’s affecting buyers, and things will only get more competitive in the more popular places to live until the Government really focuses on this as a priority,” says Tepilo founder and TV presenter Sarah Beeny (pictured). “The lack of new affordable houses…

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