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Rents in the UK continue to trend upwards, latest rental index shows
Residential rents increased in all but one region of the UK over three months to April taking the average rent, excluding Greater London, to £764 per month, the latest index data shows. It means that the average rent in the UK outside of Greater London us now 5.1% higher than a year ago while the average rent in London is now £1,543, up 7.7% Scotland and the East Midlands lead the way with fastest rising rents while the North West is the only region to register declines in rent, according to the HomeLet rental index for April. The index report says that fears that higher stamp duty charges on buy to let rental property purchases might destabilise the market have so far proved unfounded. Indeed, HomeLet’s figures show that rents agreed on new tenancies across the UK over the three months to the end of April have continued to grow at remarkably consistent rate. The index also shows that rents on new tenancies signed over the three months to April 2016 were, on average, 5.1% higher than in the same period of last year. That was barely changed from March’s figure of 4.9%, with rent rises having remained in a very narrow band since the beginning of the year. However, in London rents on new tenancies signed over the three months to the end of April were 7.7% higher than a year ago, the third successive month that London has registered this rate of increase. The latest figures show that rents in Scotland are currently rising faster than anywhere else in the UK, with new tenancies costing 11.4% more than in the same period a year ago while the East Midlands saw a rise of 7.9% in rents compared to last year. London’s rental market, where the average rent on a new tenancy is now £1,543, also continues to see rents rise more quickly than in most other areas of the country. The 2.6% gap between rent rises on new tenancies in London and the rest of the UK, where rents average £764, is barely changed on the previous. Just one area of the country, the North West of England, saw lower rents on new tenancies over the three months to March, as was the case in the previous month’s index. However, the speed at which rents are falling in the region continues to slow, to an annual rate of just 1% over the three months to April, compared to 3.5% over the three months to March. Rents agreed on new tenancies in April alone were 1.7% higher than in March. ‘It may be that over the next several months, the trends observed in the rental market begin to reflect the signs of some slowdown in the rate of house price growth that we are now beginning to see and that will be something to watch closely,’ said Martin Totty, chief executive officer of HomeLet… Continue reading
Low mortgage rates helps France top latest overseas chart
France has overtaken Spain to take the top spot on the latest overseas mortgage chart, with some 53% of loan enquiries in the first quarter of 2016, new research shows. Ideal buying conditions are drawing British buyers in particular back to the French property market, according to the report from overseas mortgage specialist Conti. It points out that French mortgage rates are at their lowest in decades and the country’s previously sluggish housing market is turning a corner at last, with reports of price increases and accelerating sales. Prices generally remain well under UK averages, however, and with the pound regaining strength against the euro in recent weeks, it’s more affordable than ever, according to the firm. ‘Current market conditions in France are great for prospective buyers, with some excellent deals to be made. And there’s plenty of room for price negotiation with some very motivated vendors. The country is also very accessible, by air, train and car, and the culture is familiar, which British investors like,’ said Clare Nessling, director at Conti. ‘Buyers who have been deferring their plans as they waited for the market to improve are taking full advantage and making their move before they miss out on the best deals,’ she added. In second place Spain accounted to 38% enquiries in the first quarter of 2016. Following a nightmarish few years, the Spanish property market is on the up at last and British investors are regaining confidence and rediscovering their love for this country, the report says. In third place, but considerably behind the top two was Portugal with a 9% share of mortgage enquiries. According to a recent report from the Royal Institutional of Chartered Surveyors (RICS), Portugal is one of the economies leading the euro area recovery with sales and prices expected to continue rising at a steady pace over the medium term. Conti is now offering its lowest ever fixed rate for property purchases in France at 1.8% over 10 years for loans of up to 80% loan to value. Mortgage rates are generally still at historic lows, and the best rates are not limited to those with the biggest deposits. Many of the current deals on offer are available for mortgages of up to 80% or 85% loan to value. Indeed, according to the latest report from French Private Finance mortgage interest rates in France have now reached unprecedented levels, so much so that non-residents with good profiles can now access 20 year fixed rate mortgages from as little as 2.25%. In terms of savings, compared to May 2014 when French 20 year fixed rate repayment mortgages were at 3.7%, rates have now decreased by 36%. In money terms, the total interest payable on a loan of €300,000 over 20 years has dropped from €117,571 to €72,822 a saving of €44,749, or €3,729 a year. The report adds that those with very good profiles who are buying in popular areas may… Continue reading
Research reveals knowledge about self building land register is lacking in UK
One in five people in the UK believe there would be increased public support for the building of new homes if self or custom build properties contributed to a greater proportion of those built, new research shows. Despite the Self Build and Custom Housebuilding Act (also known as the Right to Build Act) coming into force on 01 April 2016, some 77% of people in the UK are unaware councils are now required to keep a register of those looking to buy land in the local area to carry out self or custom build projects. The registers will work alongside measures due to come into force in the upcoming Housing and Planning Bill, which will require authorities to ensure they have sufficient permissioned plots to match the local demand on their register. However, the research from the National Custom and Self Build Association (NaCSBA) and Ipswich Building Society found that one in eight expect to show an interest in self build property within the next year. This figure has remained constant since the annual survey was launched in 2013. However, just 2% of people stated their intention to take specific actions to progress their self build projects, such as purchasing land, submitting a planning application or starting construction, within the next 12 months. ‘At a time when much of the UK is experiencing a housing shortage, more needs to be done to raise awareness of this new legislation and encourage those looking for a new home to consider undertaking self and custom build projects,’ said Paul Winter, chief executive officer of Ipswich Building Society. ‘Due to the complex nature of a self build project, those seeking these specialist mortgages are advised to research the market and seek out a provider, and product, that best suits their individual needs and circumstances,’ he added. According to NaCSBA chairman Michael Holmes the success of the Right to Build Policy initiative, and the delivery of land to meet the huge pent up demand, depends on the registers yet he pointed out that the research shows that 77% of people aren't aware of the registers, nor what their success means to creating better new homes. ‘This figure needs to change. The NaCSBA is working hard to raise the public profile and support councils across the country to ensure that they have the correct measures in place. Currently, only 35% of LPAs have adopted a register and our aim is to get this to 100%,’ he said. Raymond Connor, chief executive of BuildStore, believes that this will change as more people become aware that finding a suitable plot of land has become simpler. ‘The research shows there is a significant gap between those interested in self build and those who intend to take specific action to progress self build projects. However, it is likely this sector will soon grow once more people are aware the main challenge of finding a suitable plot of land has now been simplified,’ he explained. Continue reading
