Tag Archives: sales
Average rents in Scotland down 0.7% in March, biggest monthly fall on record
Average residential rents in Scotland fell by 0.7% in March, the first decline in six months and the biggest monthly drop on record, the latest index data shows. This took the typical rent in Scotland down to £544 per month and suppressed annual growth to just 1.1% in March, a significant downturn from 2.1% in the year to February 2016, according to the buy to let index from lettings agent network Your Move. Annual growth in the rental market is now at a 13 month low and Edinburgh was the only place to see rents rise in March to a new peak for the city of £645 a month. One reason for the growth in Edinburgh is a lack of available properties, according to Brian Moran, lettings director at Your Move Scotland. He believes, however, that rents could start to rise again with buy to let landlords now facing an additional 3% stamp duty and the effects of the new Private Tenancies Bill still to come. ‘What we do know, is that if landlords hit the brakes and cause a roadblock of supply in the private rented sector, tenants will be the casualties paying higher rents in the longer term,’ he said. Rents fell across the majority of Scotland. The steepest monthly drop in rents was experienced in Glasgow and Clyde, with the average rent in March 1.5% lower than in February, taking the average monthly rent to £544. In the Highlands and Islands there was a 1.4% fall in rents since February, and rents in the East dropped 0.8% on a monthly basis. The South of Scotland saw a more modest 0.2% dip in rents month on month. Edinburgh and the Lothians was the only region to buck this trend, with the average monthly rent climbing 0.2% to reach a new peak price of £645 per month in March. However, taking a longer term view, only two of the five regions of Scotland have seen rents fall on an annual basis. Edinburgh and the Lothians are continuing to see record annual rent rises, up 8.5% year on year in March. Rent growth in the capital has been accelerating steadily since June 2015. After this, rents in the South of Scotland have seen the next fastest annual rise, with rents up 3.2% since March 2015. The Highlands and Islands saw a 1.6% uptick in rents compared to a year ago. But two regions have seen rents fall compared to a year earlier. Both Glasgow and Clyde and the East of Scotland have witnessed a 2.5% drop in rents across the twelve months to March 2016. The index report also shows that despite the widespread monthly falls in rents in March, the proportion of late rent in Scotland has risen for the first time since October 2015. Reversing the recent trend of improving tenant finances, tenant arrears… Continue reading
Rural locations becoming more attractive to home movers in the UK
People in the UK want to live in villages but the need to have easy access to shops, transport and medical facilities and good broadband, new research has found. Some 21% of people who are moving home said that they wanted to live in a village, making it easily the most popular type of location, compared to 14% for a market town and only 12% for either a big city or a suburb, according to the study by Strutt & Parker. The Housing Futures Report found that broadband and mobile connections are essential to rural life. Access to broadband was a key factor for 49% of those intending to move to a village, while 38% highlighted mobile connectivity. It reveals that with 60% want to be able to walk to shops, 48% close to local transport and 45% near to medical facilities. ‘The UK might seem to be focused on urbanisation but we believe a new, overlooked trend is set to shape Britain’s housing market over the coming decades and this is the desire to move back to rural locations,’ said Stephanie McMahon, head of research at Strutt & Parker. She explained that while some research would suggest cities have the upper hand over villages as the urban trend has gathered pace in the UK, a number of negative traits have begun to appear such as a rise in inadequate housing provision, urban sprawl and increased pollution. She pointed out that the shift away from cities is being driven by people looking for neighbourhood safety at 86%, while 58% want space between neighbours and 48% are looking for a strong community feel. The report also point out that technology is helping to change the rural economy, which plays a key role in creating jobs and prosperity. England’s rural economy now accounts for £210 billion of economic output and hosts over 25% of all registered businesses, according to DEFRA. New companies are thriving in rural locations, including hi-tech manufacturing, food processing, the service sector, retail and power supply. ‘The expansion of broadband and mobile communications has seen a greater uptake of working from home in rural locations compared to urban areas. It seems that the same factors that once drove urbanisation, improving economic and social conditions, are now inspiring the village revival,’ added McMahon. And it’s not just those wishing to sell up from their city lives to buy in a village setting, with the report showing a significant increase in respondents looking for rental accommodation. 10% of those wanting to move to a village would live in a professionally managed private rental unit, up from 1% in 2013. The South East, South West and North East are the three leading destinations for people who are intending to move in the next five years. London’s strong economy and housing market will have a direct effect on the South East, which… Continue reading
New property tax in Scotland raises less than expected on residential properties
Revenue from the Land and Building Transaction Tax (LBTT) in Scotland failed to reach forecasts for residential sales in the 2015/2016 financial year. The Scottish Government has hoped to raise £235 million but the published figures show it was £201 million, some £34 million below expected and 26% below the £270 million collected the year before. However this fall is likely to have been exacerbated by property market activity brought forward at the end of 2014/2015 as buyers raced to beat the new LBTT when it was introduced in April 2015. LBTT replaced stamp duty on all residential purchases in Scotland and the new rates make it more expensive to purchase property with a value above £333,000 compared to the rest of England and Wales. This is especially the case in the prime market where costs are as much as 90% higher than under the previous system. ‘While the introduction of LBTT in April 2015 resulted in a welcome reduction in purchase costs for a significant number of home buyers in Scotland, the flipside of this was a substantial increase in taxes for those at the top end of the market,’ said Oliver Knight, a senior analyst with Knight Frank Residential Research. ‘Last year, we raised concerns that levying these rates for higher value homes could reduce transaction volumes and ultimately have a negative impact on tax receipts. Policymakers may need to consider allowing some room for manoeuvre on LBTT rates if they find that they continue to impact on activity at this end of the market, and if they want to hit next year’s forecast of £295 million in revenue,’ he added. He explained that one reason for the shortfall in forecast versus actual revenue in 2015/2016 has been the effect of forestalling whereby some transactions were completed earlier than they otherwise would have been to ensure they were assessed under the old SDLT regime. The latest available data from the Registers of Scotland shows that 62% of all residential sales above £1 million in Scotland in 2015 occurred in the first three months of the year, prior to the introduction of the levy. However the amount for commercial property was higher than expected. The Scottish Government had expected to raise £146 million on non-residential property but actually raised £214.2 million, some £68.2 million more than predicted. Blair Stewart, partner in Strutt & Parker's Edinburgh office, pointed out that the LBTT residential shortfall was significant and highlights a weakness in relying on too narrow a band of high value sales. ‘While the commercial LBTT tax revenues came to the rescue this year, the forecast for the next five years is steadily more dependent on high value sales. Equally, the end of the year was distorted because significant numbers of people were buying properties before the LBTT surcharge kicked in. This will not be the case in future years,’ he said. ‘While the whole housing market is improving in terms of sales volumes the… Continue reading
