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Letting Agents Confirm Rents Are Rising Again

Letting Agents Confirm Rents Are Rising Again

Letting Agents Confirm PRS Rents Are Rising Again

The latest report from the Association of Residential Letting Agents has discovered that 36% of ARLA registered letting agents reported private rented sector rent increases in June, taking PRS rental prices to their highest point since records began.

80% of ARLA letting agents surveyed expected private rental sector rents to continue to grow significantly over the next five years.

East Midlands letting agents reported 48% of tenants were charged increased rents, while letting agents in Wales only recorded 17% of tenants facing increased rental charges.

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UK Property Market Predictions For 2015

UK Property Market Predictions For 2015

What Will Happen To
The UK Property Market In 2015?

Happy New Year to all our readers, and welcome to the usual confusion over what the year ahead will bring for the UK property market.

Property prices are still predicted to rise in 2015, albeit at a much slower pace than in 2014, with economists and property experts providing forecasts ranging from 3% to 5% property price growth.

However, there are a few events that might affect the UK property market in 2015, namely the general election that will be held in May and the growing probability of Bank of England (BoE) raising the base interest rate.

Regarding the general election, it all could depend which party wins or what coalition combination is named to form the Government, after Labour recently confirmed that they would introduce a mansion tax if they come to power. Meaning that the changes to Stamp Duty that were announced in the 2014 Autumn budget would be negated if Labour win.

Less clear is what will happen with Bank of England interest rates. It had been predicted that a small rise, either by a quarter to half of a percent, was going to be introduced before the end of 2014, but that didn’t happen. Then it was going to be early 2015 but that is now also looking very unlikely.

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Bank Of England States That 2% Interest Rate Rise Would Put 480,000 Property Owners Into Mortgage Arrears

Bank Of England States That 2% Interest Rate Rise Would Put 480,000 Property Owners Into Mortgage Arrears

Bank Of England States That 2% Interest Rate Rise Would Put 480,000 Property Owners Into Mortgage Arrears

UK property buyers have an average mortgage debt of around £83,000 (GBP) plus many will have unsecured loans of up to £8,000 (GBP), however many are typically earning less than £43,000 (GBP) a year

The Bank of England has warned that up to half a million property owners could be at risk of falling into mortgage arrears once interest rates rise from their historic 0.5% low.

The BoE said the number of UK property owners expected to run into difficulties would increase by a third to approximately 480,000 in the event of a two-percentage-point increase in the cost of borrowing.

The BoE stressed the proportion of borrowers having trouble paying their mortgage loans should remain well below the record mortgage arrears levels of the early 1990’s, when the UK suffered its worst post-war property crash, provided that earnings incomes rose alongside interest rates.

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UK PRS Landlords Expect Tenant Demand To Increase

UK PRS Landlords Expect Tenant Demand To Increase

42% Of UK PRS Landlords Plan 2014 Rent Increases

According to the latest survey by specialist house share website, Spareroom.co.uk, 42% of UK private rented sector landlords expect to increase rental prices over the next 12 months and of those some 26% are planning to increase rents by more than 3%, which is significantly higher than inflation.

In their latest Rental Index, Spareroom revealed the average cost of a double bedroom in a shared house increased by 4.5% in the final quarter of 2013, reaching a new average of £507 (GBP) per calendar month.

Room rents in London also saw a rise in prices, with an increase of 2% over the same time frame, meaning the average cost of a double room in a shared house in the nation’s capital is now at an average cost of £676 (GBP) per calendar month.

Whilst some landlords plan to increase rental prices, 58% of Spareroom’s Rental Index respondents stated that they will not be raising rents and 5% of UK PRS landlords claimed that they intend to reduce rents during 2014. 

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PRS Rents have fallen back for the first time since March across most of UK, says LSL

PRS Rent falls for first time in 8 months

PRS Rent falls for first time in 8 months

Private Rented Sector (PRS) Rents fell in November 2012 for the first time in eight months, but still remain 3.4% higher than in November 2011.

The latest LSL rental survey, which measures PRS asking price rents, says that the average rent was £741 (GBP) last month.

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UK residential property prices rise to 8-month high

UK Residential Property Prices Increase To 8 Month High

UK Residential Property Prices Increase To 8 Month High

Sellers of residential property raised their asking prices by more than £8,000 (GBP) in October 2012, the biggest property price rise seen in eight months, according to property portal – Rightmove.

The typical residential property asking price rose by 3.5% month-on-month to £243,168 (GBP), as all UK regions saw prices increase.

The property search website said the autumn rebound showed “evidence of some life in the market”, although it suggested the upturn is most likely to be due to a lack of properties for sale, meaning would-be buyers have less choice.

The jump means prices are 1.5% higher than a year ago and goes some way to reversing an £11,000 (GBP) fall in residential property prices between June and September 2012, when the market saw a lull due to sporting distractions like the Olympics and Paralympics.

London still has strong overseas buyer interest and continues to perform relatively strongly and saw the biggest monthly increase in residential property asking prices, with a 4.8% jump taking average prices to £478,071 (GBP).

The South East and the West Midlands both saw 3.9% increases, while prices rose by 3.8% in the North West and by 3.4% in Wales, while East Anglia saw the smallest increase, with a 0.4% rise in residential property asking prices.

It has been suggested that residential property prices in the UK are unlikely to rise significantly over the next five years, according to one property expert.

While costs are expected to rise slowly across the coming half-decade, the escalation in UK residential property values may not be as marked as some would like to think.

Timothy Lambert, head of investment property at Parallel Investment Management, explained: “It is difficult to predict trends in the current climate of economic uncertainty, observing that although there remains a desire to buy among the general public, many individuals remain wary about the prices they are required to pay. There is also widely believed to be a growing north/south divide in terms of pricing differentiation so people will consider carefully where they are based before committing to buy.”

And while many first-time buyers may be having problems saving the required large amount of money to pay a 25% deposit, other individuals are encountering even more difficulties when attempting to qualify to obtain a mortgage at a competitive rate.

UK Buy-To-Let landlords, on the other hand have the opportunity to reap the benefits of the EU’s monumentous decision not to target Buy To Let mortgages when the European Parliament looks at mortgage lending as a whole in coming months.

UK landlords with rent guarantee insurance stay happy despite property doom and gloom

Landlords with Rent Guarantee insurance remain happiest

New data released by Nationwide and Hometrack show that overall UK residential property values have fallen when compared to this time last year and the fall has been attributed to the changes in stamp duty.

The average residential property value in March 2012 was £163,327. That is 0.9% lower than property prices were in March 2011, the largest fall in UK house prices since June last year.

Nationwide’s figures showed a fall in nearly every region of the UK, compared with the previous quarter and data from Hometrack shows a clear North – South divide.

However residential property prices increased by 0.6% in the north of England, property values also increased in Scotland, and Greater London.

UK mortgage applications were also affected by Stamp duty changes, approvals dropped to 48,986 in February 2012, some 9,000 lower than the 25-month high recorded in January 2012, the lowest mortgage approval figures for three years, according to the Bank of England.

UK residential property prices may have fallen for the first time in six months, but UK landlords with Rent Guarantee insurance are still smiling.

Buy To Let landlords remain unfazed by the dip in UK residential property prices as they continue to maximise their rental returns, as demand for rental property continues to increase. In fact BTL landlords have been experiencing higher rental yields during the past 6 months than at any other time since the economic crash in 2007.

UK landlords are utilising specialist products and services such as Rent Guarantee insurance to keep the cash coming in, ensuring that the rent is paid, irrespective of any changes to their tenants circumstances.

Residential property values increasingly disparate between North and South in UK

Residential Property Disparity Between The North and South

UK property values posted a monthly price rise for the first time in 20 months in March on the back of increased demand, activity and a scarcity of residential properties for sale.

However, UK Property Prices overall were up in the South and down in the North

According to fresh data released by Hometrack, UK residential property prices are still rising in the South, but property values have seen widespread falls throughout the East Midlands, Wales and the North.

During March 2012, residential property values did dip a little in a few parts of London, the South-West and East Anglia. However, in Yorkshire and Humber, about half the region saw property prices fall. Property values were also down in the East Midlands, North West and Wales,

With such widespread variations, the Hometrack survey shows that nationally residential property prices as a whole are barely moving, up just 0.2% from February 2012.

There was only a 4.4% increase in new buyers registering with agents, compared to 18% in February.

The length of time taken to sell a residential property also varies widely across the country, from 11.6 weeks in the Midlands and North to under six weeks in London.

Hometrack’s Director of Research, Richard Donnell, said: “The housing market is not firing on all cylinders nationally. The divergence in the relative strength in northern and southern England is set to remain. We expect prices to track sideways in the short term, with the outlook for the second half of the year hinging on households’ expectations for the economy and their incomes.”

The Hometrack report does not give residential property prices, but said that in London property prices rose 0.5% in March, the highest monthly increase since April 2010.

However, the increase in London property prices were recorded pre-Budget, when Stamp Duty on properties valued at £2 Million (GBP) plus increased from 5% to 7%, for private purchasers, and 15%for properties bought by partnerships, collective investment funds and companies.

The survey results reveal a clear divide in the strength of the UK property market between southern England and the rest of the country.

Hometrack reckon that all the evidence points to a continued firming up in UK property prices over the next few months as demand for residential property increases and the supply of available properties remains subdued.

More than 66% UK property owners believe the value of their home will stay the same in 2012.

New research from Clydesdale and Yorkshire Banks has found that the majority of the UK public believe the value of their home will stay the same over the next 12 months.

The study revealed 66% of homeowners do not expect UK residential property prices to change considerably in either direction.

Only 16% of respondents anticipate that the value of their property will fall again this year, with the remainder expecting the costs to rise.

Retail Director for Clydesdale Bank, Steve Reid stated: “It is encouraging that such a high percentage of people have confidence in the property market and the value of their home.”

The research also revealed property owners in London are the most positive about the prospects of their property prices this year, with 39% believing the value of property is likely to escalate.

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