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Rents rising across most of the UK, latest rental index shows
Rents continue to rise in many parts of the UK with Greater London, the East Midlands and Scotland seeing the fastest rent rises in the first quarter of 2016. The figures from the latest HomeLet index also show that overall the average rent in the UK, excluding Greater London, is now £755 per month, some 4.9% higher than a year ago. It also shows that the average rent in London is not £1,536, up 7.7% year on year and the North West is the only area to see a quarterly decline. The figures are published as the private rental sector is anticipating the impact of tax changes and new regulations coming into force, and HomeLet said it has been the busiest ever month for landlord insurance. HomeLet’s research shows that rents continue to rise significantly ahead of inflation, with demand for property remaining strong. However, this comes ahead of reforms that are predicted to have a major impact within the sector, including a stamp duty increase for landlords buying new properties to let, new rules from regulators on buy to let lending and limiting tax relief on mortgage interest payments to the basic rate. HomeLet’s own data already shows evidence of landlords taking action ahead of the stamp duty changes. In March it saw a marked increase in enquiries from property investors, with 37% of insurance policies being purchased by landlords with new properties compared to just 24 per cent in the same period last year. This fits with recent data from the Council of Mortgage Lenders showing a spike in buy to let lending ahead of the stamp duty increase. London’s rental market, where the average rent on a new tenancy is now £1,536, continues to see rents rise more quickly than in other areas of the country. At 2.8 percentage points, the gap between rent rises on new tenancies in London and the rest of the UK, where rents average £755, was almost identical to last month at 2.9 percentage points. Just one area of the country, the North West of England, saw lower rents on new tenancies over the three months to March, with the HomeLet Rental Index recording a fall of 3.5% over the year. ‘We’ve continued to see increases in rents on new tenancies in almost every part of the UK during the first quarter, as the private rental market has responded to the pressures of an imbalance between demand and supply,’ said Martin Totty, Barbon Insurance Group’s chief executive officer. ‘However, external factors may now come into play: the stamp duty increase has already had an impact and that surge in the acquisition of property by landlords could now cause a short term increase in the supply of rental property in some areas of the country,’ he pointed out. ‘In the longer term, changes to rules around buy to let mortgage interest being offset against tax bills, coupled with the… Continue reading
Land around railway stations to be used for new housing in the UK
A massive programme of development of railway stations and surrounding land will deliver thousands of new homes, the UK government has announced. Up to 10,000 homes are to be built around rail stations and three local authorities have come forward with ambitious proposals for the first sites which aim to revitalise town centres. A new agreement between Network Rail and the Homes and Communities Agency will see them working with local councils to trail blaze development opportunities across England’s railway stations for housing and businesses. The Government wants to hear from at least 20 local authorities to take the scheme forward as York, Taunton and Swindon councils already have proposals to spearhead the new initiative and have identified railway sites that could be pooled to deliver housing and other locally led regeneration. Drawing on the example set by the transformation of Birmingham New Street, Manchester Victoria and London Kings Cross, the Government said that it will bring together high calibre technical expertise and local knowledge to increase development opportunities that exist throughout the entire rail estate. ‘We’re determined to fire up communities and back local business so they build much needed housing and create thousands of jobs. Rail stations are a hub of communities, connectivity and commerce and should be making the most of their unique potential to attract investment and opportunities,’ said Communities Secretary Greg Clark. ‘With record numbers of people travelling by train, it makes sense to bring people closer to stations and develop sites that have space for thousands of new homes and offices. This new initiative will bring about a step change in development and ensure we go further and faster in putting these rail sites to good use,’ he added. According to Transport Secretary Patrick McLoughlin it will put stations at the heart of wider community regeneration. ‘I’m pleased to see that exciting visions for regeneration at Swindon, Taunton and York are being developed, with the potential for hundreds of additional homes and new businesses. I look forward to seeing how Network Rail and the Homes and Communities Agency’s excellent work on these projects develop,’ he said. ‘Local areas are best placed to understand and identify the opportunities that exist within their communities. The Homes and Communities Agency and Network Rail will now work with councils on the opportunities they see and any plans already in place to explore how government can support them to deliver locally led regeneration and development schemes quickly,’ he added. Proposals suggest that land at York Central station can support up to 2,500 homes. Housing would be key to creating a sustainable new community and would include Starter Homes and community facilities. Around 100,000 square meters of office and commercial space for private sector firms could also support more than 6,600 jobs in industries such as professional services. Housing and office regeneration around the station could add £1.16 billion to the local economy. Regeneration at Taunton station could provide a significant increase in commercial spaces… Continue reading
UK landlords should be prepared to offer longer tenancies, says inventory organisation
UK landlords and property managers should consider offering long term tenancies as there is increasing demand but it means a different approach, according to the Association of Independent Inventory Clerks (AIIC). The organisation said that heightened preparation must include thorough administration and more thought about the choice of furniture and interior design themes. The AIIC points out that in the recently released English Housing Survey 2014/2015 showed that the average private tenancy length is now four years, up from three and a half years in the previous survey. It also found that some 46% of 25 to 34 year olds lived in the private rented sector in 2014/2015, up from 24% in 2004/2005. ‘Despite numerous reports suggesting that the average tenant doesn't want a long term contract, the official statistics show that average tenancy lengths are increasing, particularly among families, as people rent for longer,’ said Patricia Barber, chair of the AIIC. The organisation explained that these figures should encourage landlords to think harder about what will make their rental property feel more like a home and what can be done to facilitate renters staying in their property for longer. Barber also pointed out that the phenomenon of long term renting highlights how important it is for landlords to be organised and make sure they're on top of their administration duties. ‘When tenants stick around for longer, often the chances of confusion and disagreement over certain issues are increased when the tenancy does eventually come to an end,’ she said. ‘The longer time goes on, the more likely landlords and tenants are to forget details from the tenancy agreement or important information about the deposit, and that's why stringent administration, including keeping copies of everything and organising it accordingly, is so important,’ she added. The AIIC also highlighted that landlords should be aware of the need for evidence and records, especially for long term tenancies, and this again demonstrates the value of a thorough and professionally prepared inventory carried out at the start of the rental. ‘There are more grey areas over the condition of a property the longer a tenancy goes on. A detailed inventory will help landlords and tenants to determine exactly how the property's condition has changed over the course of the tenancy, what can be deemed fair wear and tear and what needs to be replaced and therefore deducted from the tenant's deposit,’ Barber explained. Should a dispute arise at the end of a tenancy, the AIIC maintains that a detailed inventory, which has been signed and agreed by the tenant, is the most important piece of evidence available to a landlord or letting agent. Continue reading
