Tag Archives: london
Landlords of sought after lets in London getting 12 months rent in advance, research shows
Price may be falling in some parts of the prime London property market but new research shows that rich tenants are paying the entire cost of six or 12 month tenancies and deposits in advance in a battle to secure homes in London’s best addresses. A typical wealthy up front tenant letting a two bed flat in London's West End on a £3,500 per week let are willing to pay the landlord over £200,000 up front before moving in, according to the research from lettings firm E J Harris. Indeed in the first 10 weeks of 2015 it is estimated that over £100 million has been paid up front by affluent tenants, many of whom are part of a new breed from countries such as Russia, the Ukraine, China and Nigeria. The research suggests they are business people, socialites and students from very wealthy families and are able to pay anything from £9,000 to £10,000 per week on a luxurious residential property in London’s best addresses. In a normal year one in 10 tenants in the prime central London will typically pay their entire rent and deposit up front in order to secure the property they want, however this year this has jumped to one in five tenants. According to the firm this surge in up front rental payments since the start of 2015 reflects the current frenzy in the London lettings market as stamp duty and pre-election mansion tax concerns have turned vendors into landlords and buyers into tenants. The Central London £2 million to £20 million sales market has stalled and been replaced by a buoyant lettings market for properties within the same value range. The top 10 locations for up front rental payments are Mayfair, Belgravia, Knightsbridge, St James’s, Soho, Fitzrovia, Marylebone, Westminster, Chelsea and Kensington. The top London address for up front rental payments is Mount Street in Mayfair where over 80% of the tenancies are secured by up-front payments and the firm says that this is because the number of tenants seeking properties on Mount Street vastly exceeds supply. Mount Street is closely followed by Mayfair’s Dover Street, where 70% of tenancies are secured by upfront payments. This is followed closely behind by Eton Place in Belgravia, Trevor Square in Knightsbridge and St James’s square where over 60% of tenancies are secured by up-front payments. In Ward our Street in Soho, Charlotte Street in Fitzrovia, Cadogan Square in Knightsbridge and New Cavendish Street in Fitzrovia over 50% of the tenancies are done by up-front payments. ‘The dramatic rise in up front tenancy payments is driven by several factors. Stamp duty and mansion tax concerns has turned purchasers into tenants and so competition has risen for the best homes which has led to a rise in up front bids,’ said Elizabeth Harris, managing director of E J Harris . ‘Alongside this the London lettings market has become increasingly international with a new wave of wealthy tenants from Russia,… Continue reading
Duty for UK lettings agents to publicise fees welcomed
Measures which impose a duty on UK lettings agents to publicise fees both on websites and in branches have been welcomed by a leading industry organisation. The new Consumer Rights Act stipulates that charges displayed must include a description of each fee and the service it covers and state clearly if the charge applies to the property being let or each individual tenant. The Association of Residential Lettings Agents (ARLA) said that it supports the view that letting agent fees should be transparent and this will help consumers understand what services they are paying for. ‘In the interests of consumer protection, we would have liked to see legislation go further than it did and continue our call to make it mandatory for letting agents to be members of a client money protection scheme,’ said David Cox, managing director of ARLA. ‘We urge the next government to review this after the general election as the schemes provide guaranteed protection to both landlords and tenants should a letting agent abscond or misuse any money they are holding for either party; such as a deposit or rent,’ he added. However, the association, which backs the eradication of unnecessary bureaucracy and red tape, it believes that further measures outlined in the Deregulation Act will have a detrimental and unintended effect on the UK lettings market. ‘ARLA greatly welcomes the new tenancy deposit legislation contained within the Act. However, the provisions in the Act designed to prevent retaliatory evictions by landlords, creates a number of unintended consequences,’ said Cox. ‘ARLA supports the principle of legislation seeking to stop landlords from evicting tenants in response to a genuine disrepair issue. The measures will mean that protections previously afforded to compliant landlords may be eroded by dishonest tenants using the new powers to defend against legitimate possession proceedings, possibly by intentionally causing damage to properties,’ he explained. He pointed out that Section 44 of the new Act, relaxing the restrictions on the use of residential properties for short term lettings in London, will have an adverse effect on the capital’s long established and unique communities. ‘The added ability for residential homeowners to use their properties as ‘pseudo-hotels’ will lead to a constant churn of short term tenants, eroding the foundations of existing communities. Moreover, the new measures may lead to longer term, more established tenants being forced out, an increase in anti-social behaviour, reduced security and an increased risk of crime for permanent residents. London’s success is predicated upon its varied but long established community identities, coupled with the ever growing strength of its booming lettings market,’ Cox added. Meanwhile, the National Landlords Association (NLA) is claiming a victory for landlords in Liverpool after gaining two significant concessions from Liverpool City Council (LCC) in the run up to the launch of their city wide licensing scheme. Although the council has refused the NLA’s request to postpone the launch of the scheme that is due to go live on… Continue reading
Property prices up 0.5% in England and Wales last month says Land Registry
Average property prices in England and Wales increased by 0.5% in February and are up 6.5% year on year, according to the latest index from the Land Registry. This takes the average house price in England and Wales to £180,252 but sales have slowed. From September 2013 to December 2013 there was an average of 77,174 sales per month. In the same months a year later, the figure was 75,553. In London prices increased 0.6% and are up 13.1% year on year. The average price of property in the capital is £463,872, the data also shows. The North West saw the lowest annual price growth 0.7% and the North East experienced the greatest monthly price rise with a movement of 6.2%. The North West also saw the largest monthly decrease with a fall of 1.7%. On a local authority basis Bracknell Forest experienced the greatest annual price increase in February with a rise of 14.5% and Gwynedd saw the greatest annual price fall with a fall of 3.6%. County by county Ceredigion experienced the strongest monthly growth with an increase of 4.6% and Torfaen saw the most significant monthly price fall with a fall of 2.6%. Four counties and unitary authorities saw no monthly price change. The metropolitan district with the largest annual price increase is Salford rising by 11.7% while Newcastle upon Tyne experienced the highest monthly price rise, with an increase of 2.7%. Bolton saw the greatest annual price fall with a movement of 2% and Sandwell saw the greatest monthly price fall with a decline of 2.6%. In London the borough with the highest annual price rise is Newham with an increase of 21.4% and Brent experienced the highest monthly increase with a rise of 1.9%. Kensington and Chelsea saw the lowest annual growth of 7.8% and Hackney had the greatest monthly fall with a decline of 1.5%. The index also shows that price index volatility is greater in areas where recorded sales volumes are low. Index volatility leads to erratic and high changes in reported price. Some of the areas that typically have very low transaction volumes include City of London, Rutland, the Isle of Anglesey, Merthyr Tydfil, Blaenau Gwent, Ceredigion and Torfaen. The number of properties sold in England and Wales for over £1 million in December 2014 decreased by 4% to 929 from 967 in December 2013 and the number of properties sold in London for over £1 million in December 2014 decreased by 6% to 621 from 622 in December 2013. David Whittaker, managing director of Mortgages for Business, believes that the index shows that there is a serious lack of supply. ‘That raises the continual spectre of many households being priced out of homeownership, and puts the spotlight clearly on the private rented sector,’ he said. ‘The longer the housing shortage continues, the more it will be left up to Britain’s landlords to fill the gap. As we approach a general election it will be particularly interesting… Continue reading
