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UK landlords seeing rise in tenant demand, especially from families
Almost half of landlords in the UK are reporting an increased demand for rental properties which is expected to continue over the next 12 months. Some 43% have experienced a rise in tenant demand and it is being driven by young people and families, according to the latest research by specialist buy to let lender Paragon Mortgages. It also shows that 51% expect this level of growth to continue over the next 12 months with 47% renting to young couples, 43% to young singles and 42% to families with children. ‘It is no surprise that rental demand is steadily increasing. With continued stress on the housing stock driving prices up, tough affordability hurdles for would be buyers and a social rented sector under pressure as a result of renewed interest in right to buy, a steady increase in rental demand was practically inevitable,’ said John Heron, Managing Director of Paragon Mortgages. ‘It is important that landlords continue to expand the supply of rented property in order to maintain balance and so avoid unsustainable increases in rents. A healthy, competitive and innovative buy to let market is critical to this,’ he added. Meanwhile, separate research shows that more than half of tenants say they experienced problems with their rented homes over the past 12 months, ranging from poor maintenance to breaches of their contract. The biggest problem, for 15% of tenants, was their landlord’s failure to fix structural problems including damp, a leaking roof or rotten window frames, according to the research by mortgage and loans provider Ocean Finance. A further 13% of tenants suffered delays in repairing broken furniture, showers and washing machines. 14% of tenants faced unexpected increases in their rent, disputes over money deducted from their deposits and even early eviction when their landlord sold their property. Tenants in London, where more than 10 million people live in private rental accommodation, fared the worst, with 60% saying they experienced problems in the past 12 months. This was followed by those in the East Midlands and the rest of the South East region. Some 35% of tenants said even though they complained to the landlord or letting agent, the problems were not fixed. While 13% said they didn’t know who to turn to for advice, while 5% took matters into their own hands and refused to pay their rent until the landlord resolved the problem. ‘Landlords have an obligation to ensure that the properties they let are well maintained and safe for their tenants to live in. The research indicates that many tenants are renting sub-standard properties. It’s also concerning that people are facing mid-tenancy rent increases or have money unexpectedly taken from their deposits,’ said Gareth Shilton, a spokesman for Ocean Finance. ‘One of the problems may be a lack of clarity over whose responsibility it is to maintain different aspects of a property. Often the landlord believes the tenant is responsible for doing repairs that in fact they are obligated to make,’ he… Continue reading
Demand for homes in UK up by 9% in second quarter of 2015
Demand for homes in the UK has increased by 9% in the last three months with London commuter areas seeing a surge and some parts of the north also on the up. Locations including Watford, Reading, Aylesbury and Guildford now dominate the top 10 in demand spots, according to the second quarter data from online estate agent eMoov. While the north of the country has 60% of the coldest spots, some have seen demand rise, most notably North Tyneside up by 62%, Sunderland and Dudley both up by 32%, and South and North Lanarkshire in Scotland up by 29% and 26% respectively. The data also shows that Bristol is one of the hottest demand spots outside the south east with demand up 10% since the first quarter of the year. Durham at 12% has seen demand fall by 30% over the course of a year, making it the second coldest spot in the nation. Rochdale and Northumberland, both at 17%, have also continued to cool, moving both locations up the table of coldest spots in June. In Scotland as well as North and South Lanarkshire seeing a rise in demand, Fife is up 22% and Highland is also up 22% since the first three months of the year. Westminster in London has also continued to decline, dropping a further 10% in demand and two places, making it the third coolest whilst Ealing has witnessed the largest fall in the last three months, with demand down by 36%. Brent and Hounslow also fell by 4% and Oxford is the only commuter zone to see a decrease, as demand fell by 8%. Since the second quarter of Medway has seen the biggest increase with a rise of 70% in demand. Scotland has also performed strongly over the course of the year with Fife up 42%, South Lanarkshire up 22% and North Lanarkshire up 15%. The annual top 10 also includes Wiltshire up 48%, Sefton up 45%, Bedfordshire up 38%, Tameside up 25%, Bolton up 18% and Bradford up 16% while at the bottom are Calderdale and Westminster both with a fall of 58%, Ealing down 47% and Aberdeenshire down 40%. ‘The UK property market definitely seems to have experienced a post-election bounce. With demand up 9% nationally, people are clearly more confident about buying now that the next five years of government has been decided,’ said the firm’s chief executive officer Russell Quirk. ‘It’s interesting to see the demand for commuter zone property continuing to grow. With London demand falling, property owners wanting to see an increase in their property price, might want to sell up and head a few miles out of the capital,’ he added. Continue reading
Prime country house prices in Scotland affected by new land and building tax
Prime country house prices in Scotland increased by 0.2% between April and June taking annual growth to 1.4%, the latest index analysis report shows. But this is down from the recent high of 2.8% in June last year and the recently introduced Land and Building Transaction Tax (LBTT) seems to have had the greatest bearing on market performance. The analysis report from Knight Frank also suggests that the recent landslide SNP general election victory in Scotland on 07 May has had an impact, albeit a more modest one. Under LBTT those buying homes worth less than £333,000 now pay less tax for homes, but those purchasing property with a value above this threshold now pay more in purchase taxes. For example, a house in Scotland valued at £1.5 million would have attracted a stamp duty liability of £43,750 under the old system. Based on the new LBTT rates, that same property now attracts a bill of £78,350, a near 80% increase. As a result, buyers and vendors brought forward prime transactions prior to the introduction of LBTT in order to benefit from the lower stamp duty charges. There was a spike in activity during the first three months of 2015 with the number of sales completed by Knight Frank nearly 50% higher year on year. Since then, however, the prime market has been subdued, with the number of sales completed between April and June notably lower than the same period of 2014. There is likely to be an ongoing period of adjustment at the top end of the market as individuals factor in the increased cost of moving, according to Ran Morgan, head of Scotland residential sales at Knight Frank. He pointed out that there are still pockets of activity in Scotland’s prime market however, mostly in areas within commuting distance of large towns and cities. Prices in the central Scottish region, within an easy commute of Edinburgh and Glasgow, for example, rose by 0.4% between April and June and have risen by 2.8% on an annual basis. ‘In spite of higher levels of tax, Scottish property prices remain some way below their previous market peak. The market continues to offer good value, especially when compared with London and southern England,’ Morgan added. Continue reading
