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Scottish rents rise at two thirds the speed of England and Wales
Scottish rents are rising at just two thirds the speed of those in the rest of England and Wales with a rise of 2.1% year on year, the latest index data shows. This compares with a 3.3% rise in England and Wales and month on month in Scotland average rents have stagnated at £548 and some areas, such as the Highlands and Glasgow have seen rents fall compared with January. The figures from the latest buy to let index from lettings agent network Your Move also shows that while rental growth has seen a slowdown from 2.3% in the 12 months to January, it is an uptick from the 1.1% annual change recorded in February 2015. According to Brian Moran, lettings director at Your Move Scotland, it is ironic that Scotland is witnessing one of the biggest government interventions into the private rented sector, at a time when rents have been moving at a much slower pace than in other parts of the UK. But he pointed out that Scottish rents are still making incremental upwards progress but crucially, against a bedrock of stronger tenant finances. ‘Like in any market, affordability is a fundamental check on prices. Rental arrears are a great benchmark of affordability in the market, and their frequency is falling,’ he said. However, he also pointed out that the passing of the Private Tenancies Bill last week signals a paradigm shift in the private rented sector in Scotland, introducing a new artificial influence in the market, aside from regional supply and demand. ‘Intervention in the market has had negative side effects in the past, noticeably the abolition of tenancy fees in 2012, and it will be interesting to see how landlords recuperate and recover from this regulatory blow,’ he explained. ‘Anything that makes buy to let investment slightly harder to swallow, and managing property portfolios more of a painful process for landlords, risks cutting off the inflow of investment. Tenants will ultimately be the ones who feel the effect on their bottom line, if the supply of properties to let dries up, Moran added. A breakdown of the figures show that in the year to February 2016, three of five regions in Scotland have recorded positive annual growth in rents. Edinburgh and the Lothians is leading rent growth across Scotland, with the strongest year on year rise in rents, at a record speed of 7.7%. This is the fifth successive acceleration in annual rent growth and has taken average monthly rents in the region to a new peak of £644, up £46 from £598 in February 2015. Rents in the South of Scotland are also now standing at a record high of £515 per month, up from £498 a year ago. This 5.3% annual rise is the second fastest increase recorded in the year to February. In the Highlands and Islands, rents are now 2.5%… Continue reading
Liverpool district named as top up and coming area for affordable homes in UK
New research shows where in the UK it is possible to find a home below the national average price of £200,000 but in areas where there has also been storing price growth in recent months. Liverpool's central L1 postcode is the top affordable area on the up, having seen a property price increase of 41.2% in the last year. An average property increased in value from £85,000 between December 2011 and November 2014, to an average of £120,000 for the year to November 2015. The analysis of Land Registry data by consumer organisation Which? Mortgage Advisors, also shows that second and third were 'LL27 in Conwy North Wales and BD1 in Bradford, just east of the city's University. Average property prices in these postcode areas increased by 37% and 36% respectively. In LL27 the average property price rose from £135,000 between 2011 and 2014, to £185,000, and in BD1 they rose from £42,000 to £57,000. Despite the significant increase in average property prices in these areas, they remain under the national average. Even in London where prices are higher there are pockets with affordable homes with the potential to increase in value such as DA18 in Bexley DA18. The average property price in DA18 was £191,500, up by 32% in the last year. ‘For a first time buyer or a buy to let investor, these up and coming areas can provide an affordable alternative to buying in an already established area,’ said David Blake at Which? Mortgage Advisers. ‘You could see your property grow in value quickly, but it's important to remember that property markets can change, and there is never a cast iron guarantee that values will continue to rise,’ he explained. The organisation says there are a number of signs that an area may be 'on the up' such as being next to currently thriving town and if a local authority plans to regenerate the town centre as well as plans to improve transport links. Other signs include the arrival of new trendy shops, restaurants, cafes and nightlife while skips and scaffolding can be an indication of increased prosperity and improved housing stock. New build properties appearing can often increase the value of surrounding properties as well as new schools being built or current ones climbing Ofsted rankings while new estates agents appearing are also regarded as a sign of a growing property market. Continue reading
UK property prices up almost 8% year on year
UK house prices increased by 7.9% in the year to January 2016, up from 6.7% in the year to December 2015, taking the average price to £292,000, according to the latest data to be published. The index from the Office of National Statistics (ONS) also shows that prices increased by 8.6% in England, by 0.1% in Scotland and by 0.8% in Northern Ireland but fell by 0.3% in Wales. Annual house price increases in England were driven by an annual increase in the South East of 11.7%, then London with growth of 10.8% and the East of England up by 9.8%. Excluding London and the South East, UK house prices increased by 5.1% in the 12 months to January 2016 and on a seasonally adjusted basis, average house prices increased by 0.9% between December 2015 and January 2016. In January 2016, prices paid by first time buyers were 7.7% higher on average than in January 2015 while for owner occupiers prices increased by 8% for the same period. Richard Snook, senior economist at PwC, pointed out that the first ONS housing market figures for 2016 show strong momentum in the UK but he also pointed out that performance has been mixed across the UK. He said that the market has cooled in Wales, Scotland and Northern Ireland, where prices are roughly unchanged from a year ago, whilst growth in the South continues to power ahead. ‘The recent changes to stamp duty, whereby supplementary rates will be charged on purchases of additional homes, may be providing a small boost to the market, as people rush to complete transactions before the changes come into force in April this year,’ he added. Rishi Passi, chief executive officer of Oblix Capital, believes that behind the scenes, an imbalance between supply and demand has been squeezing the bottom end of the market, which together with a rush to beat the April stamp duty rise, has driven up prices and stretched affordability for those taking their first step on the housing ladder. ‘The new Lifetime ISA and Help to Save initiatives will go some way to give entrants to the market a much needed leg up, and with local authorities across England planning 270,000 houses a year over the next 15 years, the Chancellor’s commitments to house building may begin to level the playing field,’ he explained. The figures reveal the sharp regional differences, according to Mark Posniak, managing director at Dragonfly Property Finance, and he said that for annual prices in the South East to have out-performed London underlines an ongoing shift in demand away from the capital as people look for more value elsewhere. ‘London will remain a formidable bastion of the UK's property market but for many its prices are an insurmountable obstacle. With interest rates unlikely to rise this year and the employment market as strong as it is, demand will remain,’ he pointed out. Continue reading
