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Labour Manifesto Aims To Change PRS Forever

Labour Manifesto Aims To Change PRS Forever

Labour’s PRS Rent Control And Tenure Plans Under Attack

Labour’s manifesto confirms their plan to introduce 3 year tenancies and a ceiling on excessive rent rises in the UK’s private rental sector (PRS).

Previous Government’s have tried introducing rent controls and the result discouraged the building of new homes as well as reducing more financial investment in their rental property portfolios by landlords.

For years rent controls caused damage to the nation’s housing market, reducing the number of properties being built and recovery took almost a decade. The current rhetoric being touted around by politicians could have disastrous consequences for house builders and landlords alike.

The introduction of longer term tenancies is very much geared towards tenants but fails to address the problems already faced by landlords when tenants abscond without giving any notice, leaving the landlord out of pocket and looking for new tenants.

The UK’s private rental sector (PRS) has improved dramatically over recent year’s thanks in part to the introduction of tighter legislation, but there remains a delicate balance between regulation and altering the relationship between tenant and landlord. Intervention on rents and security of tenure has in the past damaged both market liquidity and good business values within the PRS.

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Letting Agent Complaints On The Rise According To Property Redress Scheme

Letting Agent Complaints On The Rise According To Property Redress Scheme

Complaints About Lettings Agents  On The Rise
According To Property Redress Scheme

Due to the fact that more tenants and property owners are now aware of their consumer rights, especially the right to redress, there has been a month on month increase in the number of complaints being made against lettings agents, property management companies and estate agents.

The Property Redress Scheme, (PRS), is just one of three consumer redress schemes set up by the Government to provide fair and reasonable resolutions to disputes between the public and property agents.

From 1 October 2014 it became a legal requirement for all lettings agents, property managers and estate agents, as defined by legislation, in England to belong to one of the three Government approved redress schemes, which are:

The number of complaints raised with the PRS is increasing month on month. Of the complaints raised so far,

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UK Residential Property Prices Only Increased By 0.5% Last Month

UK Residential Property Prices Only Increased By 0.5% Last Month

Residential Property Prices Only Increased By 0.5% Last Month 

New data released by Hometrack shows that residential property prices only increased by 0.5% during May 2014, less than previous price rises recorded in the three previous months, suggesting a slowdown in property sales and price growth.

The data shows that the proportion of UK regions recording property price increases during May had fallen to just 42%, down from the 50% recorded in March and April 2014.

While property prices may have continued to rise in London, there has been an overall slowing in the rate of growth, with property prices only increasing by 0.6% in May, compared to the 0.8% average increase over each of the previous six months.

The main growth in London is in lower priced areas of the capital that are perceived as offering better value for money, however, central London prices only increased by 0.2% in May. 

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UK Buy-To-Let Property Returns Better Than Fixed Rate ISA’s

UK Buy-To-Let Property Returns Better Than Fixed Rate ISA’s

UK Property Investment Offers Better Returns Than Fixed Rate ISA’s

UK investors are putting even more of their money into property investments rather than saving using an ISA because the returns can be far better.

UK property values have increased 11% year on year despite the property crash in 2008, however, the best fixed rate ISA offered by UK banks only offers savers an annual return equal to 1.85%.

The rise in UK property prices has caught the attention of diverse investors who would usually opt for different types of investment products to give them good  returns on their investment funds.

Property investment in the UK’s private rented sector allows investors to build profitable rental portfolios that produce better yields than other types of investment funds, including ISA’s.

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Published UK Property Data For 2014 Suggests A Record Start To The Year

Published UK Property Data For 2014 Suggests A Record Start To The Year

Published UK Property Data For 2014 Suggests
A Record Start To The Year 

Confirmation that the UK’s residential property market has returned to health is the first data from Rightmove covering 2014 which suggests that the year ahead looks good for property!

The Rightmove House Price Index (HPI) of 2014 shows that property asking prices increased by 1% in January.

Property prices are traditionally subdued in the first month of the year, prices increased just 0.2% in January 2013 and have usually fallen by an average of 0.2% in the month of January over the last decade.

The number of properties coming to market and activity is also up as both estate agents and property vendors look to cash in on the increased confidence in the UK property market.

Year on year property asking prices are up 6.3%, the highest annual rate of increase since November 2007, before the onset of the UK’s credit crunch. 

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House Prices Officially Rising Across The UK

House Prices Officially Rising Across The UK

UK House Prices Rising Faster Than Inflation

The Office for National Statistics (ONS) has recorded year-on-year house price increases across the UK with property values increasing by:

  • 5.6% in England
  • 5.4% in Wales
  • 2.5% in Scotland
  • 3.3% in Northern Ireland

The increase in house prices and activity in the UK property market has been credited to an increase in first-time buyers (FTB) purchasing residential property using the Government’s Help-To-Buy scheme.

The ONS have revealed that annual house price growth outpaced the cost of living in November 2013, even after removing property market activity in London and the South East of England from the calculations, property prices were up by an average of 3.1%, compared with a 2.1% rate of inflation.

Property price increases in the UK are generally driven by market activity and price increases in London and its surrounding areas, although other regions have started to show accelerating property price increases.

Property prices in London were up by 11.6% in November 2013, compared with a year earlier, and property prices have also increased strongly across the whole of the UK according to official figures

Regional Property Price Increases

  • London: up 11.6%
  • South East: up 4.5%
  • West Midlands: up 4.4%
  • North East: up 4.2%
  • East: up 4.1%
  • Yorkshire and the Humber: up 3.2%
  • South West: up 3.1%
  • East Midlands: up 2%
  • North West: up 0.6%                           Source: ONS annual change, Nov 2013

UK regions are becoming far more buoyant and less reliant on activity in the London property market and the majority of buyers are having to look further afield than central locations to find affordable properties, creating a halo effect on property prices.

The annual increase in UK property prices in November follows on from the 5.5% rise observed in October 2013 and although the annual comparison did not show any acceleration, property prices were higher than the previous month increasing by 0.5% in November compared with October, with an average residential property valued at £248,000 (GBP).

The ONS house price index is based on mortgage completions, and is considered to be more comprehensive than House Price Indices (HPI) produced by mortgage lenders such as the Halifax and Nationwide whose figures are based on their own mortgage data.

Property Asking Prices Collapse In NovemberProperty Prices Rise At Fastest Rate For 6 Years…Or do they?

The asking price of property is supposed to be rising at the fastest rate for over 6 years, according to Rightmove, however, asking prices actually dropped by 2.4% during October, all but wiping out September’s 2.8% gain. This is the third dip in property prices in 2013.

UK property owners have raised the asking price for their properties by 4% compared to this time last year, marking the biggest annual rise in residential property prices since the financial crisis and property crash hit in 2007.

The average asking price that UK vendors want for residential property now averages around £246,237 (GBP), according to Rightmove, compared to £252,418 (GBP) in October.

It is worth pointing out that residential property asking prices usually fall by approximately 3% in November ahead of the festive season traditional slowdown.

So with residential property asking prices falling by just 2.4% in November suggests that the recent upturn in housing market activity will cushion the predictable seasonal drop.

Rightmove say that buyers still have a wide choice of property types to choose from as the UK property market is holding up relatively well for first-time buyers, as the number of flats and terraced properties on the market has declined more slowly than the number of detached and semi-detached properties this month.

Property prices in the East Midlands were 7.4% higher than they were in 2012, averaging £168,873 (GBP), outpacing property price rises in London.

The average asking price for a residential property in London is over three times greater than property values currently are in the East Midlands and asking prices in London have risen by 6.9% year-on-year, to reach a typical average value of £517,276 (GBP).

In fact residential property asking prices have increased across most UK regions apart from in the North, where residential property prices have dipped by 0.5% annually to average just £141,426 (GBP).

Property prices in Wales dropped by the smallest amount, down by 0.4% to reach a typical average of £165,110 (GBP), while desperate property vendors in London have dropped residential property asking prices by as much as 5% since October.

Rightmove said that traffic to its website has increased 30% in the last 12 months, a sure sign of growing demand from would-be property buyers. The property portal also said that the stock of unsold residential properties has fallen from an average of 71 per estate agency branch one year ago to 67.

Rightmove Director, Miles Shipside, said: “Estate agents expect a more buoyant 2014 as they pick up early signs of an increase in buyer interest and demand, so this side of Christmas could be the time for eager property buyers to hunt out keen property vendors and strike a deal. However, agents’ challenges differ wildly depending on local market conditions. While some are really concerned about future sales because of a lack of fresh vendors, others report vendors getting too brave too early on their asking price aspirations in less active parts of the country, potentially stifling a property market recovery before it has got going.”

The infographic below shows the increase and decreases in residential property asking prices in November 2013 compared to October.

Property Asking Prices Collapse In November

Property Asking Prices Collapse In November

Source: Rightmove.co.uk

UK Property Prices Up £7,000 In Four WeeksUK Property Prices Hit 2008 Peak Values

UK property prices have jumped up £7,000 (GBP) in a month as UK property market activity picks up.

The huge increase in property values over the last four weeks is confirmation that the UK is enjoying another property boom.

The £1,750 weekly uplift puts the price of a typical residential three-bedroom semi detached property at £252,418 (GBP), according to popular property portal, Rightmove.

The biggest increase in property prices was recorded in London where new vendors have added an extra £50,484 (GBP) to average residential property asking prices this month, however property prices in the nation’s capital are over inflated compared to the rest of the UK.

The rise in UK property prices is being driven by first-time buyers and second step buyers following the introduction of the Government’s Help-To-Buy mortgage scheme.

Fears of a housing bubble have also been eased as the number of new property vendors entering the property market has also increased by 8%, however property shortages have driven up property prices in some UK regions.

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Demand May Outstrip Supply As Lenders Brace For Help-To-Buy Stampede

Demand May Outstrip Supply As Lenders Brace For Help-To-Buy Stampede

Demand May Outstrip Supply As Mortgage Lenders Brace For Help-To-Buy Stampede

Over 600,000 residential properties are eligible for the £12 Billion (GBP) scheme, while Zoopla says buyers will still need average £10,000 (GBP) deposit

More than 600,000 residential properties on the market are eligible for inclusion in the £12 Billion (GBP) second phase of the Help-To-Buy scheme, according to the latest in a series of surveys leading to predictions that UK mortgage lenders will be inundated due to the expected demand for the government-backed mortgages.

Details of the 95% mortgages, which are available to existing property owners as well as first-time buyers, are to be unveiled by Chancellor of the Exchequer, George Osborne, with some banks expected to invite loan applications within hours of the announcement expected next week.

The second phase of the Government’s flagship scheme to allow more first-time buyers and second steppers, wider access to the UK’s residential property market has already been brought forward by three months, with high street bank Santander claiming that up to 1.7 million people want to use the scheme.

The Help-To-Buy scheme will cover existing residential properties as well as new-build properties, but as yet there are no plans to allow Buy-To-Let property investors use the scheme.

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Help-To-Buy Heralded As UK Property Market Saviour

Help-To-Buy Heralded As UK Property Market Saviour

RICS Claim Help-To-Buy Is Reason
For UK Property Market Recovery

The Royal Institute of Chartered Surveyors (RICS) have stated that the Government’s Help-To-Buy scheme and other financial initiatives have seen the UK property market turn the corner after the post recession slump.

In its monthly report RICS said property prices are up for a fourth consecutive month as the largest number of property buyers in 4 years return to the market.

The RICS report particularly picked out the West Midlands and the North East, as two areas which had suffered more than most in the UK property market crash, but these areas experienced the biggest increase in property buyer activity during July.

The widespread pick-up in the UK property market has seen residential property prices rise at their fastest rate since the peak of the property market in November 2006.

There is a growing chorus that the Government’s Help-To-Buy scheme, which was introduced in April to provide equity loans for first time buyers of up to 20% towards the cost of a new build property worth up to £600,000 (GBP) is creating a new property bubble.

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