Tag Archives: australia
One in five UK landlords could be out of business due to tax breaks change
The cut in UK tax breaks for certain buy to let landlords due to be phased in over the next few years could put one in five out of business, new research suggests. The blow comes at a time when £9.9 billion is lost to rent arrears and damage every year and for some the change in tax could be the final straw. Landlords are also losing £4.5 billion in terms of damage to their properties. There are also concerns about the new immigration checks on tenants which have been running as a pilot scheme in the West Midland and due to be rolled out nationally, according to the annual landlord report from specialist landlord law firm Access Legal. It points out that many but to let landlords are running a small business and would not continue if they face making a loss. Currently 33% say they feel that the odds are stacked against them and in favour of tenants. The research cites extortionate upkeep costs, cuts to tax breaks and around 46% of tenants getting away with not paying their rent arrears, even after court proceedings, as the main reasons for the pessimism. Three quarters of buy to let investors also stated that they don’t feel money is safe with letting agents, and 43% of landlords have dropped their letting agents to save money and avoid safety issues. The research says that in total damage, repairs and rent arrears amounts to £9.9 billion every year. £4.5 billion and it means that every landlord in the UK is out of pocket by £6,600 covering these costs, every year. ‘We work with many landlords covering tenant and landlord disputes. The extortionate cost of being a landlord seems to be a figure that keeps growing. Many landlords are subject to damaged properties and rent arrears. The law doesn’t always side with tenants, but it’s a hard process for landlords to go through and a tricky legal system,’ said Eamonn Hogan, a solicitor at Access Legal. The five most common causes of damage to a property are broken appliances at 41%, damaged decorating at 40%, damaged carpets 37%, lack of cleanliness 33.18% and cigarette burns 22%. Worst areas in the UK for rent arrears include Cambridge, Newcastle, Oxford, York and Manchester while the worst areas in the UK for property damage include Manchester, London, Wrexham, Chelmsford and Birmingham. The study also found that 40% of landlords have been subject to a tenant not paying rent and 20% of landlords have been subject to vandalism in their properties. Continue reading
REO and distressed property still an important part of the US housing market
Once a stain on the US housing market, Real Estate Owned property and short sales are now regarded as a critical market indicator and the number increased by 0.7% in August, the latest data shows. While this type of property is a reminder of the legacy of the housing downturn, real estate investors, seeking discount prices, have transformed what was once undesirable into a more popular way of investing in the market. The data from Clear Capital shows that the quarterly distressed saturation rose from 15.4% to 16.1% and the firm says that increases in distressed activity leading into winter could shift momentum towards peak distressed saturation levels of 40%. Typically, distressed saturation fluctuates with the seasons and increases in the winter season. Distressed saturation rates have exceeded that of the nation in the West and Midwest, up by 0.9% and 1.2%, respectively, while the largest gains in distressed saturation have been in the South, with a 1.5% increase from 18.6% to 20.1%. The Northeast was the only region to experience a decrease in distressed saturation, where rates dipped 0.3% from 14.3% to 14%. The report shows that for the past three years, distressed saturation in the San Juan metropolitan area has been steadily increasing, having grown 8% from 9% in 2013 to 17% today but says that this trend is unusual in the current housing environment. ~ Over the same three year period, nearly all of the major metro markets have experienced steady declines in distressed saturation. In terms of pricing, this near doubling of the saturation rate has corresponded with a rapid change in price declines from a yearly loss of 1.5% in 2013 to a yearly rate of decline of 10.2% today. The Midwest is the only region to see quarterly gains in price appreciation, nearly doubling from 0.4% to 0.7%. The region still lags behind the West, which experienced declining gains of 0.1% yet still continues to report highest quarterly growth at 1.2%. The South and Northeast appreciation rates remained stagnant, reporting 0.8% and 0.2% growth over the quarter. There are differences in regional performance. The San Jose and Detroit metropolitan areas both report healthy growth rates of 2.1%. While the South did not see accelerated price gains, continued growth through August could be a sign that this region is on firm footing moving forward. Seven of the 15 top performing markets are located in the South, while four of the lowest performing metropolitan areas are in the Northeast. Distressed saturation continues to be a challenge in today’s housing market, according to Alex Villacorta, vice president of research and analytics at Clear Capital. ‘In fact, today’s traditional housing market continues to be defined by distressed saturation levels. At the start of the downturn, distressed properties were an albatross around housing’s neck but between 2011 and 2013 investors stepped in, buying, rehabbing and selling or renting distressed properties, which gave way to higher demand and rising prices,’ he… Continue reading
New home sales dip down in Australia, latest data shows
Seasonally adjust new home sales in Australia were down marginally by 0.4% in July but the market overall is in strong shape, the latest report from the Housing Industry Association shows. This is because overall new home sales are at historically high levels, according to HIA chief economist Harley Dale. ‘It appears that the cyclical peak for total new home sales occurred in April, but the subsequent downward trend is very mild,’ he said. But he explained that key leading indicators of home building, including HIA new home sales, suggest little prospect for further growth in new home construction in the 2015/2016 financial year. ‘However, following three consecutive years of strong growth which has propped up the domestic economy considerably, both HIA new home sales and ABS building Approvals signal another healthy year for new home construction,’ he added. Indeed, the data shows that detached house sales increased by 0.7% in July this year but the annual peak for detached house sales has passed. Over the three months to July this year detached house sales fell by 2.8% and are 3.4% lower when compared to the three months to July 2014. Multi-unit sales peaked in May this year and fell by 4.2% in July following a decline of 2.9% in June. Over the three months to July this year multi-unit sales increased by 8.3% but it was the strength of the May result that drove the quarterly outcome. A breakdown of the latest data shows that in the month of July 2015 detached house sales increased by 4.2% in New South Wales but fell by 2.3% in Victoria and by 4.9% per cent in Western Australia. Sales were close to flat for the month in Queensland with a marginal fall of 0.6% and South Australia they were down by just 0.2%. Continue reading
