Like every month, Rentila offers you an overview of the main real estate news of interest to landlords and tenants. This month, we focus on: A 2% increase in house prices by end of 2024; UK house prices drop by more than £5,000 in August; Mortgage arrears largely unchanged in Q2; One in 20 tenants have missed rent payments over the last 12 months; UK rental market booming with record rents and 17 enquiries per property; How to avoid bad tenants as a landlord; Stamp duty relief blow for first-time buyers… Happy reading and… renting!
London’s rental market heats up as summer lets season begins
London’s rental market is showing signs of life as the summer lettings season gets underway as tenant applicant demand surged by 15% in June compared to May.
This increase matches pre-pandemic trends and is expected to continue over the coming months.
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A 2% increase in house prices by end of 2024
Zoopla’s latest data indicates that the housing market is continuing to adjust to 4%-plus rate mortgages with positive signs of increased activity.
While house prices increased by just 0.1% in the past 12 months (to £265,600 on average), house prices have increased across all regions of the UK over the first half of 2024.
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Buy-to-let purchases fall over a quarter as landlords fear further pain from new Government
The number of buy-to-let (BTL) property purchases in the UK fell 25% from 240,800 in 2022/23 to 192,100 in the year ended March 31 2024.
This fall in BTL purchases has partly been driven by the sharp rise in interest rates on BTL mortgages but also by a series of measures introduced over the last few years that have made BTL property less attractive from a tax point of view.
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UK house price growth picks up steam
The average UK house price climbed 0.3% month-on-month in July, marking the fastest pace of growth since December 2022, new figures from Nationwide reveal.
It says the annual rate of house price inflation is 2.1%, up from 1.5% in June.
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UK house prices rise in July as mortgage rates fall
House prices jumped at the fastest pace in seven months in July as borrowers reduced mortgage rates ahead of an interest rate cut by the Bank of England, according to Halifax.
The UK’s largest lender said a typical property cost £291,268 in July, up more than £2,200 compared to the previous month, “following three relatively flat months”.
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UK house prices hold steady as rents remain at near-record levels
On a monthly basis, prices edged up by just 0.5% from May, marking the fourth consecutive month of price rises after eight months of annual declines. This brings the average property value in the UK to £288,000.
The ONS data, which is based on Land Registry information from sold properties, highlights regional variations in property values across the UK.
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UK house prices drop by more than £5,000 in August
The average price of a newly marketed UK home has dropped by more than £5,000 month-on-month in August, as the distractions of school summer holidays traditionally bring a dip in prices.
Across the UK, the typical price tag on a home retreated by 1.5% or £5,705, property platform Rightmove said. The drop pushed the average asking price to £367,785.
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Landlord loans fall by more than half in 2023: UK Finance
Buy-to-let house purchase lending fell by more than half in 2023, with the number of new loans falling from 25,280 in the last quarter of 2022 to just 12,422 in the first quarter of this year, data from UK Finance shows.
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Competition drives mortgage rates below 4%
Nationwide Building Society is leading the charge, offering a 3.99% five-year fix and cutting other fixed deals by up to 0.25 percentage points.
This follows similar moves by other major lenders, driven by competition and hopes of falling interest rates.
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Mortgage approval stability shows ‘still life in market’
Net mortgage approvals remained stable in June indicating “there is still life in the mortgage and property market”.
The Bank of England’s money and credit report for June found that net mortgage approvals, or approvals net of cancellations, for house purchases stood at 60,000 in June, the same as the previous month.
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Mortgage rates drop below 4% for the first time since April – but will they get any cheaper?
Fixed-rate mortgage deals have dropped below 4% for the first time since April – though only for those with at least a 40% deposit or equity in their home. However, mortgage brokers say rates could continue to fall as the year goes on – so what, if anything, should you do about it?
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Mortgage arrears largely unchanged in Q2
The number of buy-to-let (BTL) properties in arrears showed a marginal increase of just over 0.5% compared with the previous quarter, to 13,570.
The overall proportion of mortgages in arrears remains low, at 1.10% of homeowner mortgages and 0.69% of BTL mortgages.
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One in 20 tenants have missed rent payments over the last 12 months
Thousands of UK households have missed or defaulted on a rent payments over the past 12 months.
Missed housing payments were particularly high among renters, said Bluestone Mortgages, the firm that issued the figures, affecting one in 20 tenants surveyed.
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UK landlords anticipate 54% growth in demand for flexible/coworking workspace by 2030
Office landlords in the UK are going to significantly increase the amount of square footage in their builds that is dedicated to flexible workspace, new research has revealed.
On average, respondents to the survey predict that over half (54%) of the total square footage of their office space will be dedicated to flexible or coworking spaces by 2030, a significant increase on their current reported levels of 36%.
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UK rental market booming with record rents and 17 enquiries per property
The latest market analysis from Rightmove reveals that the average advertised rent outside of London has hit a new quarterly record of £1314 per month. This is nearly 7% higher than last year’s figure of £1231 and an increase of 1.8% compared to the previous quarter.
London rents have also surpassed the previous record and are now around 4% higher than last year, standing at £2661.
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One in five renters forced to find rent guarantor
One in five private tenants has been forced to use a rent guarantor to secure their home as competition to secure a tenancy intensifies, research reveals.
Housing Hand has analysed the latest English Housing Survey data which revealed that 21% of private renters – 940,000 households – were required to provide a guarantor when moving into their current property.
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‘Too late for rent caps’: East London rents jump 50 per cent since 2019
Rental costs in London have skyrocketed over the past five years, and new data has shown that rental growth in the city’s historically-affordable east has risen the fastest.
Prices have risen by around 50 per cent in Shoreditch, Bethnal Green and Haggerston to pass an average of £1,000 per month…
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Rental value growth falls in prime London as government plans reforms
Just as the prospect of tax rises in the Budget is causing uncertainty in the prime London sales market, Labour’s plans for a Renters’ Rights Bill is doing the same thing in the lettings market, Knight Frank reports.
The agency’s figures show that rents rose by an average of 2.5% in the year to July in prime central London.
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Rent arrears soar leaving landlords struggling with shortfalls
Rent arrears have surged by a staggering 30% year-on-year, according to new data.
The average claim for rent arrears hit £2,092 in the second quarter of 2024. This marks a 15% rise from £1,816 in Q1 2024 and a 31% increase from £1,594 in the same period last year.
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Is Buy-To-Let still worth it?
Higher borrowing costs, a reduction in tax relief on additional homes, plus more stringent requirements for landlords under the new Renters’ Rights Bill, are combining to take much of the shine off buy-to-let as an investment.
And that’s not to mention stagnating property prices over the past two years.
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You can still make money as a landlord, but only if you’re going to do it properly
For too long, “accidental landlords”, “dinner party landlords” and any other -isms of people who thought renting out property would be a lark and a way to make money have clouded the field of what is, in fact, a very serious job.
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Mortgage mistakes to avoid for first-time buyers and wealthy individuals
Navigating the mortgage market can be daunting — we spoke to a finance expert to get some advice that could make all the difference.
A finance broker emphasised the importance of exploring multiple lending options and being well-prepared with documentation in advance of any application.
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How to avoid bad tenants as a landlord
You don’t have to be a property tycoon to experience the headache and financial strain of a bad tenant. Whether you own one property or a portfolio, the risk of encountering problems is a reality for all landlords. It’s important to remember that not all problem tenants are intentionally difficult; sometimes, life circumstances beyond their control can create challenges.
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BTL investors remain confident despite policy uncertainty
The UK’s private rented sector (PRS) continues to attract investors despite some uncertainty surrounding future government policies, research reveals.
According to a report by Connells Group, which analysed data from the second quarter, there has been a 6% increase in new instructions compared to the same period last year.
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Stamp duty relief blow for first-time buyers
Only 37% of homes for sale will qualify for stamp duty relief when the current threshold of £425,000 reverts to £300,000 from April 2025, a study reveals.
Rightmove says this offers a bleak outlook for first-time buyers in England and is a sharp decline from the current 58% of homes that qualify.
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Average landlord £11,000 worse off if capital gains tax rates aligned with income tax rates
New analysis has found that if capital gains tax (CGT) rates were aligned with income tax rates then landlords selling their properties in the UK would on average be £11,000 worse off.
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Major sporting venues bring gold for buy-to-let investors
The latest market insight from a London’s lettings and sales estate agent, has revealed that rental properties within arm’s reach of one of the capital’s major sporting venues are putting in a stronger performance for buy-to-let investors when compared to the boroughs in which they are located.
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