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Tenants Share To Cut Living Costs

Tenants Share To Cut Living Costs

Private Rental Sector Tenants
still struggling to make ends meet

With the amount of would-be tenants looking for shared accommodation is reported to be up by 31% since 2011, suggesting that UK tenants are looking at sharing property with other tenants in order to counter increasing living costs and ensure that the rent is paid, however, Rent Guarantee Insurance is a better idea.

Research by house-share website Spareroom.co.uk found that for single tenants, renting property by themselves is not really an affordable option, so many tenants are turning to flat or house sharing in a bid to save cash.

The website recently surveyed its users and discovered that 51% had returned to flat and house sharing after previously renting property in the UK PRS alone or with a partner.

Spareroom tell would-be tenants that huge financial savings can be made by renting a room in a shared rental property, rather than renting the whole property.

The average cost of renting a one-bedroom flat in the majority of the UK, is £12,669 (GBP) per year (including bills), while the cost of renting a room in a shared rental property is just £6,079 (GBP) with bills included, a saving of £6,590 (GBP) per year.

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Good news for landlords

Good news for landlords

There is a lot of Good News For Landlords Around As PRS rents Increase, Tenancies Last Longer And Demand Remains Strong

Good news for landlords as monthly PRS rents have increased by 1.1% year on year to average £845 (GBP) per calendar month (pcm). Scotland has witnessed the greatest rental price increase at 6.7% compared with the first quarter of 2013.

There has also been an increase in the number of older private rented sector tenants according to the latest quarterly index published by Countrywide lettings agency, who noted a 6% annual growth in the number of tenants over the age of 50 renting property in the UK private rented sector (PRS). The lettings agency also report that there has been a 7% annual decline in the number of tenants aged under 25 in the second quarter of 2013.

Buy-To-Let yields are strengthening across the UK, with the average yields being recorded in 3 regions:

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UK PRS Rents Rise Faster Than Tenant Income

UK PRS Rents Rise Faster Than Tenant Income

Working tenants renting property in the UK private rented sector have diminishing amounts of disposable income after new research revealed that average PRS rents rose four times faster than average UK salaries increased.

The March 2013 HomeLet Rental Index shows the average cost of renting property in the UK private rented sector increased by 3.3% during the first quarter of 2013 to average £776 (GBP) per month.

In contrast, the average amount working tenants earn in a year only increased by a minimal 0.8% over the same period to £27,300 (GBP).

Although the 3.3% rise is much higher than that of tenant income, the increase in PRS rents has apparently slowed.

Data from March’s report also shows the average cost of renting a property in the UK PRS in the first quarter of 2012 increased by 3.4% and a significant 6.9% in 2011.

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Countrywide’s Quarterly Lettings Index Results

Survey Reveals Favourable Rental Market For UK Landlords

Survey Reveals Favourable Rental Market For UK Landlords

Results from the latest Countrywide Quarterly Lettings Index has revealed a favourable UK lettings market for buy to let landlords.

Countrywide’s Quarterly Lettings Index analyses rental prices, rent arrears and gross rental yields in the UK private rented sector and is the UK’s largest national lettings index based on over 50,000 properties across England, Scotland and Wales and the latest survey has uncovered a number of interesting statistics:

  • Average monthly rents in Inner London are the highest in the UK and four times more than in Scotland
  • Scotland has the cheapest rental accommodation in the UK and is the only region where arrears have increased
  • Average monthly rents increased the most in Wales and the East of England at 5.5%, followed by Outer London at 5.4%
  • Average UK rental yields of 6.2%, with Wales topping list at 6.7%
  • Rising rents, falling arrears and fast letting times provide perfect recipe for buy-to-let investors
  • Average rents have risen and rental payment arrears have fallen in Q1 2013 compared to the prior year.

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Private Rental Sector Void Periods and Rent Arrears 

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Rent Guarantee Insurance Helps Landlords Avoid Rent Arrears

Rent Guarantee Insurance Helps Landlords Avoid Rent Arrears

UK private rented sector landlords are reaping the rewards of the development of specialist products and services designed to ease the burden for landlords and the UK lettings industry.

According to data from the National Landlords Association (NLA), private rented sector void periods have fallen to their lowest level in over 12 months, with only 33% of landlords experiencing vacant periods in the last three months. The figures are down 13% when taken year on year.

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Landlord Possession Orders And Tenant Evictions Increase

Tenant Eviction Figures Increase Again

Tenant Eviction Figures Increase Again

There has been a dramatic increase in the number of PRS landlords seeking to evict bad tenants and the volume of possession orders doesn’t look like abating any time soon according to data released by the UK Government.

Government figures show that there were 103,329 landlord claims for tenant eviction and orders for possession made last year, the highest recorded rate over the last five years and continues to represent an upward trend.

It is estimated that between 67% and 80% of claims led to a possession order being granted by the courts.

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New landlords are using rental income to provide for their retirement

New landlords are using rental income to provide for their retirement

A high proportion of struggling residential property owners are copying the practices of successful portfolio landlords and choosing to offer their properties for rental purposes in the UK private rental sector (PRS) in order to provide adequate finances for their retirement.

Of the struggling property owners choosing to offer property to rent for the first time and existing portfolio landlords who responded to the BM Solutions/ BDRC Continental survey:

  • 84% view their rental property as a supplementary income to their pension
  • 60%of landlords actively plan to live off the rental income either before or at retirement.
  • 40% agree that their property is their pension and intend to make a decision dependent on the state of the property market once they reach retirement age.
  • Very few landlords plan to sell all properties in their portfolio when they reach retirement

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Specialist Insurance can help landlords profit from property

Specialist Insurance can help landlords avoid tenant rent default

In the UK private rented sector, the average rent for a residential property now stands at a staggering £777 (GBP) per month across the whole of the country but there are some regional differences.

Private sector rents in Greater London rose by 6.7% during the last 12 months to reach a regional average of £1,224 (GBP) per calendar month (pcm).

In stark contrast, PRS tenants in the North-East living in similar sized properties are paying an average rent of just £512 (GBP) pcm.

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UK Property Prices Increase

UK Property Prices Increase

According to one of the UK’s leading mortgage lenders, residential property prices in the UK rose by more than economists had expected in January putting a halt to the annual decline.

Nationwide say that residential property prices in the UK actually increased by 0.5% in January 2013, a further sign that the two years of static residential property prices and historically low property sales across the UK may soon be coming to an end.

Nationwide have published data that states that the average residential property price in the UK is now £162,245 (GBP).

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Fall in the number of tenants in severe rent arrears

Fall in the number of tenants in severe rent arrears

The number of tenants in severe rent arrears declined by 15.6% during the final quarter of 2012, according to data released by Templeton LPA, part of the LSL Property Services group.

The data indicates that in the last quarter of 2012, almost 16,000 fewer tenants faced severe rent arrears of more than 8 weeks rental costs, compared with the previous quarter of 2012.

The number of tenants in this situation has dropped for the first time in over a year and could in part be due to the development and availability of Rent Guarantee Insurance products.

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