Tag Archives: guides
UK rents not showing signs of seasonal slowdown, says latest monthly index
UK rents increased by 0.7% month on month in October to £1,294, showing no signs of the seasonal slowdown that normally hits the UK rental market in the autumn, according to the latest index. Rents increased across most of the county with the only exception being Scotland which saw a marginal monthly fall of 0.1% to £696, the data from the Landbay Rental Index shows. The report suggest that the latest rises indicate that the UK’s housing shortage combined with growing pay for many and unemployment levels hitting their lowest level since 2008 have put an end, at least for the time being, to the usual seasonal fall in rents that starts in the autumn. In fact the last time there was a sustained period of falling rents was in the winter of 2012/2013, when rents saw monthly falls from August 2012 to April 2013. Rents increased every month in 2014 and have been strong this year, seeing only small month on month decreases between June and August before increasing again in September and October. Typically an autumn seasonal slowdown in the rental market is caused by lower tenant demand after heightened demand in the summer from students, first jobbers moving for work, and the expiry of annual contracts that originated in previous summer rental rushes. The fact that it did not happen last year and shows no signs of arriving this year demonstrates that the UK private rental sector is seeing a period of consistently high demand and insufficient supply of properties. October’s rent increases were fastest for three bed properties, which are often rented by families moving for work, up 4.7% year on year and one beds that are most popular with first jobbers and young professionals, up 4.4%. Increases in the UK are being driven by London and the southeast. In October London rents increased by 4.1% to an average of £2,063, whilst rents in the southeast rose by 3.4% to £1,033. The impact of London on the national private rental sector is becoming increasingly evident by the surge in rents among commuter hotspots. Southend on Sea, historically not well known for its commuter town status, has seen consistently faster growth in rents than the national average. The seaside town’s one hour direct train into London and recent gentrification have played their parts in an annual rental increase of 9.7%, to an average of £759 per calendar month. Out of the top 20 areas of the UK outside of London to see the fastest rent increases, just Aberdeen, Edinburgh and Bath were outside of the southeast. ‘Seasonality has always been a strong feature of the UK’s rental market so the fact that it appears to be declining in influence is a powerful sign of the increasing strain the private rental sector is under to house the UK population,’ said John Goodall, chief… Continue reading
UK housing supply crisis deepens as new stock falls to post economic downturn low
The total stock of property for sale in the UK has fallen to a new post economic crisis low with 45% fewer properties for sale than in November 2007, according to the latest index report. It also shows that average annual asking price growth in England and Wales increased further to 7.3%, driven by lack of supply with the shortage affecting all regions but particularly London, the South East and the East of England. Consequently, prices in these regions continue to rise at an alarming rate, well ahead of the national average. Over the last 12 months, asking prices in London, the East and South East of England have risen by 12.5%, 9.8% and 9.4% respectively. Meanwhile, the number of properties coming on to the market in the same regions is down by 15%, 13% and 10% respectively. However it is not a uniform picture, according to the asking price index from Home.co.uk. Prices have slid in the North East and Yorkshire during the last month. Asking prices were down 0.1% month on month in Yorkshire and Humberside and down 0.5% in the North East where prices are also stagnant compared to a year ago. Indeed, as a whole prices in the northern regions and Wales continue to stagnate. Annualised price changes for the North East, North West and Yorkshire of just 0.0%, 1.2% and 1.9% respectively indicate that demand levels remain depressed relative to the South. Welsh property has fared a little better with home prices rising by 2.7% over the last year, but still a long way behind the mix-adjusted average price rise for England and Wales of 7.3%. Overall, the current mix-adjusted average asking price for England and Wales is now 25.8% higher than it was in November 2010. Further upward pressure on this headline figure will come from London, the East and South East of England over the next year. North of the border, Scottish home prices are rising more quickly, up 4.7% over the last year and 6.4% since November 2010. Sellers there are obviously patient, as the typical time on market is 114 days, 16 days longer than the figure for England and Wales. The Aberdeen property market has been adversely affected by plunging oil and gas prices, and properties on the market there have been piling up. Meanwhile, the Edinburgh market is experiencing a boom, with prices driven up 13% over the last year and supply falling away. Further south, the northern English regions show relatively poor home price growth. Of those, the North East property market has suffered the most over the last five years. Prices are falling in many towns in the region, such as Billingham, mainly due to the downturn in the petrochemical industries. Crime and joblessness continue to adversely affect many of the larger urban areas. However, pockets of significant growth do exist, such as prosperous market towns like Yarm. The South East continues to show massive price growth and… Continue reading
House prices up for third month in a row across whole of UK
House prices have risen across all parts of the UK for the third consecutive month in October whilst stocks continue to fall, the latest residential market survey shows. The residential report from the Royal Institution of Chartered Surveyors (RICS) says that prices are expected to rise by 4.5% per annum over the next five years, a cumulative increase of around 25%. It also says that new sales instructions extend their streak of uninterrupted decline stretching back to February but although sales growth has paused, expectations remain a little more positive. In October some 49% more chartered surveyors saw house prices rise across the UK, compared to 44% more in September. As prices rise in all areas of the UK, East Anglia has consistently seen the fastest rises over the last three months and 91% more chartered surveyors reported seeing a rise rather than fall in prices in October. In contrast, 25% more chartered surveyors saw prices rise in London over the last three months, with only 5% more expecting a rise in prices in the capital over the next three months, the lowest reading across the UK over this time period. However the 12 month view for the capital is still relatively strong. Contributing to the rise in prices across the country, demand from potential buyers grew across the UK in October with 12% more respondents seeing a rise in new buyer enquiries. The report also shows that demand continues to considerably outpace supply and the number of new instructions has decreased for the ninth month in succession, with 10% more chartered surveyors reporting a fall. The supply of new stock to the UK market has been in decline since the middle of 2014, with the number of new instructions only increasing in one of these months. Despite the lack of new stock to the market, sales activity is relatively healthy and following a small pick-up in agreed sales in September, activity was little changed this month across the UK. This chimes with HMRC transactions data, which continues to see the number of sales rising consistently over the year. In the UK lettings market, demand is also continuing to outpace supply in the three months to October. This has been the trend nationally for some time, with the growth in demand outstripping that of supply since 2009. Unsurprisingly, rental expectations remain strong and respondents continue to expect rents to rise over the year ahead. Rental growth is anticipated to accelerate to an average of just under 5% per year over the coming five years. ‘It is hard to get away from the issue of supply when it comes to the current state of the housing market. The legacy of the drop in new build following the onset of the global financial crisis is now really hitting home, with both the sales and letting markets continuing to show demand outstripping supply on a month by month basis,’ said Simon Rubinsohn, RICS chief… Continue reading
