Tag Archives: crisis
New tenants in UK facing higher rents as demand increases
There is an increase in demand for property in the UK private rental sector with new tenants seeing a rise in monthly rents from a third of lettings agents. Indeed some 31% of letting agents saw an increase in the cost of monthly rent for tenants from January to February, according to the Association of Residential Letting Agents (ARLA) monthly Private Rented Sector Report. The South East of England saw the highest number of landlords increasing rent per calendar month with 41% of agents in the region reporting an increase whereas in contrast in Wales only 13% of agent’s reported uplift in rent prices. An increase in rents may be down to the fierce competition for rental property. ARLA licensed agents reported an average of 40 prospective tenants per branch in February, up from 38 in January. The report points out that whilst only 13% of Welsh tenants saw an increase in rents, they are facing the most competition for housing, with 46 tenants registered per member branch. Tenants in the East of England are also facing fierce competition with an average of 45 house hunters registered at each branch. Overall the report says that supply in the rental market remains steady, with an average of 184 properties managed per member branch, which is the same as last month. The East Midlands boasts the highest level of supply, with an average of 269 properties per branch, whilst supply in London has dropped to an average of 122 per branch, down from 140 in January, increasing already intense competition in the capital. According to David Cox, ARLA managing director, it shows that demand for rented accommodation is still on the increase, and monthly rents are following suit. ‘When demand is high then the premium for a home increases. House prices are still sky high and are unlikely to reduce anytime soon, which means that getting onto the property ladder is a challenging and unlikely task for many, so renting a property is the only option available,’ he explained. Looking ahead to the general election in A RLA Letting agents are strongly against Labour’s proposal to introduce three year tenancy agreements with rent controls and strict rules to make it more difficult to evict tenants The survey found that 70% of agents believe this would result in landlords pulling out of the market and creating a decrease in the supply of rental property, which would have detrimental effects on the industry. Just under half of agents, 46%, argue that three year tenancy agreements would cause them to lose flexibility over the duration of their tenancy agreements and 69% of ARLA agents think point blank that the proposal would not benefit tenants. When it comes to building new homes to help kick start the property market, some 37% of ARLA agents believe that the Conservatives’ pledge to… Continue reading
Research reveals concerns about new mortgage rules in UK
More than half of people who are either considering, or are in the course of applying for a mortgage in the UK believe that the obligation placed upon mortgage lenders to assess their ability to repay will slow down the application process. Overall 59% are in this position and 32% of those who have yet to apply also said they would find it fairly difficult to obtain evidence of all the expenditure information they believe a lender needs to assess a mortgage application. The research from Equifax, a credit information provider, also found that 69% who responded to the survey expressed concern that more detailed affordability checks would affect the amount they could borrow and 40% are worried about the time it will take to complete their mortgage application. The new responsibilities placed upon lenders, which came into effect in April 2014 as a result of the Mortgage Market Review, place even greater onus on the lender to assess an applicant's ability to repay. The applicant's credit history is likely to play a crucial role in that assessment, alongside other information gathered as part of the application process. ‘It is important to remember that lenders will take into account the information provided on the application form and will look at an applicant's income and outgoings to ensure they can afford the mortgage they are applying for, now and in the future. However, our research suggests that 22% are still unconvinced that the new affordability rules will help prevent home owners overstretching themselves in the long term,’ said Laura Barrett of Equifax Consumer Affairs. ‘We would recommend compiling any financial documents and expenditure information needed to support a mortgage application, as soon as the application process starts. Advance preparation will hopefully avoid any unnecessary delays,’ she pointed out. ‘A lender will typically look at an applicant's credit history when determining whether they meet eligibility criteria and may also use credit information during affordability assessments. Therefore, it is suggested that individuals check their credit report before making any applications to ensure that it is in the best possible shape for them,’ she added. Continue reading
Call for next UK government to reform planning to help boost housing supply
{mosimageA leading campaigning group has warned that consistent deregulation and demoralisation of the UK planning system is putting the very fabric of towns, cites and the countryside at risk. In a pre-election manifesto the Town & Country Planning Association (TCPA) argues that there is a real danger that the planning system, a vital national asset, essential to the maintenance and well-being of the country, will soon be lost. In particular it is concerned that as housing supply continues to fail to keep up with demand good planning is needed more than ever. The manifesto calls for action in the first 100 days of a new government to restore the importance of planning as a key tool in delivering much needed new homes and communities. This includes taking steps such as creating a new legally defined purpose for planning based on sustainable development, the updating and effective deployment of New Towns legislation, and changing the National Planning Policy Framework to place social justice, equality and climate change at the heart of planning decisions. The manifesto additionally calls for better planning for cities and stronger measures to ensure that councils work together to meet housing need. ‘A new government must act to restore the prominence of planning as an essential element to create the new homes, communities and infrastructure that the nation so desperately needs. For the sake of our children and grandchildren, planning must be seen as a positive proactive force for good and must be placed at the centre of political debate,’ said Kate Henderson, chief executive of the TCPA. ‘At its best, planning has proved to be a powerful tool to bring forward sustainable growth, and to deliver multiple benefits to our society including certainty and confidence for businesses, democratic rights for communities and protection for our environment, heritage and biodiversity,’ she explained. ‘As we continue to battle with the nation's housing crisis, good planning is needed as never before to plan for and create the homes and communities we desperately need. However, the planning system as we knew it is being continually undermined and devalued though significant reforms and deregulation,’ she added. ‘Planning has lost all sense of the progressive social values that once lay at its core, and unless we are careful, is at risk of being destroyed altogether. The TCPA's position is simple: good planning makes better places,’ she concluded. Continue reading
