Rents rise across most of U.K. except London

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Rents rise across most of U.K. except London

    An interesting report has today been published in a leading Mortgage publication which is interesting to read. I think the final paragraph gives full endorsement of the valuable contribution made by investors in the Private Rental Sector

    Rents rise across all regions bar London: HomeLet

    By Leah Milner3rd June 2021 4:28 pm
    Average rents across the UK have increased by 4% over the past year to £997 a month, but London has seen a decline, according to the latest index from HomeLet.

    Rents in the capital dropped by 0.9% to £1,583, in the 12th consecutive month of year-on-year declines.

    Every region apart from London saw rents rise on an annual basis and when the capital is taken out of the equation, the average UK rent is up 6.4% to £854.

    The East of England saw the highest annual growth with rents up by 8.5% to £1,00.

    Looking at the month-on-month trends, Scotland saw the strongest growth with rents up by 2.6% to £707 in May.

    In the East Midlands, however, rents fell by 0.7% to £704 from April to May .

    HomeLet and Let Alliance chief executive Andy Halstead says: “We’ve seen from sharp house price spikes across the country that the Coronavirus pandemic changed what Britons are looking for in a property.

    “Many are said to be looking for properties offering more living space; for those working from home as an example, that’s also the case in the private rented sector.

    “Rental properties continue to play a crucial role in meeting the demands of people up and down the country, and the flexibility and responsiveness shown by the private rental sector will be vital in the coming months as the country opens up again.

    “As rents increase, we’ve also seen an increase of over 10% in suspicious and fraudulent applications for let property; with backlogs and delays in processing evictions, the demand for high-quality tenant reference and insurances has never been higher.

    “The overwhelming success of the vaccination drive brings hope that returning to some form of normality could be on the horizon.

    “However, we would still caution that millions could be made unemployed at the end of the furlough scheme – posing considerable problems in tandem with an unbalanced rental market.

    “Whilst the government looks to stimulate homeownership, the importance of the private rented sector can’t be understated and should not be overlooked.

    #2
    I think this only tells you one side, yes rents may be increasing, but in my experience this is due to all the new regulations and compliance measures which were added to during the last year, which increased the overall costs of operating a rental, therefore the rents had to increase to cover these costs. Also it's the fact that supply is limited at the moment and demand is high. The housing stock has been neglected for many years, like other sectors (for example the NHS, Education, New Technology - which have all come to the surface during the pandemic).

    A lot of people just can not afford or want to buy a property, where they are responsible for the cost of fixing things. The criteria for buying a property is changing, and with the increased responsibility on banks and other lending institutions to carry out stress tests and financial feasibility on potential owners, a lot will not pass, even though there are incentives like the stamp duty holiday, LISA and rent to buy schemes. Fear for some is that interest rates will eventually increase. Our European counter parts majority of them prefer to rent out of choice than be home owners.

    Comment


      #3
      It's an interesting one for sure. Your mention about our european neighbours being renters as opposed to homeowners intrigued me and made me do a little research.

      Germany is an interesting one, as it would appear that the price of houses was dropping for a number of years from 1980 to 2010. People didn't want to buy property as they were always reducing in value, so they rented. Now over the past 10 years the price has been increasing again so more people are becoming home owners.

      Looking at tenants rights, it would appear that tenants have more rights than they do over here. In a similar vein to Scotland, Tenants can only be evicted for specific reasons, mostly the Owner wanting to live in the premises again. One thing that did intrigue me is when it comes to selling a property, is that the current tenants must be offered the opportunity to buy the property first at a fair market price.

      I'm not so sure that it is the regulations and compliance that is the full reason. I certainly have not noticed much of an increase in my expenses year on year. I honestly believe that rents are going up because they can. Because we landlords want more money.

      Comment


        #4
        Originally posted by ExpertInAField View Post
        Germany is an interesting one, as it would appear that the price of houses was dropping for a number of years from 1980 to 2010.
        That coincides with their population gradually declining.

        Originally posted by ExpertInAField View Post
        Now over the past 10 years the price has been increasing again so more people are becoming home owners.
        That coincides with their population growing (from increased immigration).

        Comment


          #5
          The statistics don't seem to show what you suggest.

          There was a population boom (of germans) in the 1980's to 1990's with barely a blip shown on the average house prices. There was an increase in immigration from the early 2010's to 2016, but has dropped off considerably for the past 5 years to be a net negative, yet the house prices keep increasing.

          Comment


            #6
            Originally posted by ExpertInAField View Post
            The statistics don't seem to show what you suggest.

            There was a population boom (of germans) in the 1980's to 1990's
            There wasn't.

            Population of West Germany in 1980 was 61.44M.
            Population of West Germany in 1988 was 61.24M

            The combined population of West and East Germany 1991 after easing freedom of movement and re-unification (the Berlin wall coming down) was 79.75M.

            They didn't suddenly start breeding more!

            Comment


              #7
              I am such an idiot. How could I forget such a monumental occasion.

              Comment


                #8
                It is just the general property cycle - London has the strongest first half followed by the rest of the UK..........This is just a follow on effect of that. Banks lend money to the richest firstly - London. They then lend money to major Cities Like Leeds, Manchester, Birmingham - I wonder why these areas boomed next? Eventually it makes its way out in to secondary areas as the major cities become over valued. This is then followed by a cool off/bust period as prices have really gone as far as then can and banks are now worried.

                Comment


                  #9
                  The population of Germany in 2020 is 83 Mil which is only 3 Mil up from 1991.

                  https://www.statista.com/statistics/...on-of-germany/

                  Comment


                    #10
                    The dynamic in Germany will be slightly unusual given that they allowed 1.2m refugees into the country in a single massive wave in 2015.

                    That would be a significant jump in number of households.
                    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                    Comment

                    Latest Activity

                    Collapse

                    • Turning a btl to holiday home
                      by riva
                      I have a btl that was undergoing renovations that just completed before the pandemic hit. So I've never let it and ended up using it every so often as a holiday home as it was vacant. We now love it so much that I'd like to continue using it like that. I may also consider the occasional air bnb or friends/family...
                      17-06-2021, 08:44 AM
                    • Reply to Turning a btl to holiday home
                      by loanarranger
                      What you are hoping to achieve falls outside of Non Regulated Mortgages unless the lender accepts Holiday Let’s and as already mentioned are Let for the minimum prescribed period, so in addition to avoiding foul of your lender you then need to ensure that the property Insurance is in line with standard...
                      18-06-2021, 21:00 PM
                    • Reply to Turning a btl to holiday home
                      by DPT57
                      You have to pay CGT on a holiday home as well as a rental property, so it won't alter the position if you sell.
                      18-06-2021, 10:36 AM
                    • Mortgage News
                      by loanarranger
                      The following article has appeared in one of the Mortgage Trade journals reporting on views expressed by the Association of Mortgage Intermediaries an influential trade body within the mortgage industry.

                      "Mortgage rates are likely to rise in the first quarter of 2016 as lenders look...
                      23-12-2015, 19:43 PM
                    • Reply to Mortgage News
                      by loanarranger
                      NOT SURE WHAT IS GOING ON IN THE MORTGAGE / PROPERTY MARKET !!

                      Given the media reports of high demand for property across most of England resulting in properties being sold at significantly higher prices and the failing service of lenders , solicitors in providing speedy service to applicants/clients,...
                      17-06-2021, 17:49 PM
                    • Reply to Turning a btl to holiday home
                      by OopsieDaisy
                      Furnished Holiday Lets must be available to rent for 210 days a year (30 weeks) and actually rented out for 105 days a year (15 weeks), excluding any time that you as the owner occupy the property - these are the HMRC criteria.
                      To qualify for business rates, the property must be available to rent...
                      17-06-2021, 15:28 PM
                    • Reply to Turning a btl to holiday home
                      by landlord-man
                      For a Holiday Home you must make it actively available for lettings 105 days per year.

                      You can split income/profits at whatever % you wish with your partner - very handy if one of you works etc

                      You dont pay Council Tax but register to Business Rates - which you can claim 100%...
                      17-06-2021, 14:45 PM
                    • Reply to Turning a btl to holiday home
                      by jpkeates
                      Looks like a great site!...
                      17-06-2021, 09:39 AM
                    • Reply to Turning a btl to holiday home
                      by Mrs Mug
                      Yes, there is. See the link below,

                      https://www.laymyhat.com/forum/...
                      17-06-2021, 09:18 AM
                    • Reply to Turning a btl to holiday home
                      by jpkeates
                      I would imagine that it would mean a remortgage - most BTL mortgage terms wouldn't allow the use of the property as a holiday let.

                      There are quite specific rules about how long properties have to be available and actually let to qualify as a holiday let which might make the accounting more...
                      17-06-2021, 09:00 AM
                    Working...
                    X