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Rental Property Seen As Safe Investment

Rental Property Seen As Safe Investment

Landlords Increasing Rental
Property Portfolios

There has been a rise in the number of landlords expanding their rental property portfolios over the last three months, according to fresh research by the Association of Residential Letting Agents (ARLA).

ARLA questioned its members to find out if landlords are currently increasing their investment in rental properties in the private rental sector (PRS) and they discovered that the number of landlords buying properties has risen from 30% to 39% over the last three months.

ARLA have taken the responses from their members to indicate greater confidence in the UK private rented sector and that rental property is still perceived as a safe investment amidst ongoing global and national financial instability by landlords with existing rental property portfolios.

ARLA research also revealed that fewer landlords are quitting the UK private rental sector and selling their rental properties too, with numbers incrementally down on the previous quarter, from 15% to 14%.

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North - South Divide Widens Again

North – South Divide Widens Again

A new study by the Office for National Statistics (ONS) has revealed that 20% of middle aged workers are property millionaires – on paper!

In the South East of England almost 30% of people in their 40s and 50s living in private residential properties can calculate their wealth to seven figures, when including savings, investments, the value of their homes and pension pots.

However, the study also revealed a sharp divide between North and South of England as well as between generations.

It claims that five times more children are growing up in households in the bottom top wealth bracket, North East, South East, wealth category as there are in the top wealth bracket.

While almost 60% of middle aged people in the South East have built up an impressive half a million pounds in savings, pension and property wealth, in the North East, 20% of the same age group have little or no assets that they can rely on.

The ONS study shows how wealth builds up through people’s working lives but begins to fall once they retire and begin using up their accumulated assets, in many cases on elderly care.

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Homelessness is a real threat for young families in the UK

Homelessness is a real threat for young families in the UK

An extra 1.5 million 18 to 30-year-olds are expected to apply for private rented sector (PRS) properties over the next eight years.

The influential Joseph Rowntree Foundation says that one risk is that pressures on private rental accommodation could force young families out of the sector and into homelessness. The foundation forecasts that around 310,000 more young families will be looking for private rented housing in 2020 compared with today.

In a new report, ‘Housing options and solutions for young people in 2020’, it warns that the influx of youngsters chasing a private rental home will see young families, poorer and vulnerable people finding it hardest to compete for tenancies.

As previously reported by Legal 4 Landlords News on Friday 15th June 2012, an additional 500,000 young people will be forced to stay with their parents into their thirties, taking the total number of young people still at home to 3.7 Million by 2020.

Read the full story here http://blog.legal4landlords.com/index.php/property-renting-set-to-be-way-of-life-for-young-families/

The report is just the latest in a series of similar documents warning of the growing pressures on the private rented sector as increasing numbers of people are locked out of residential property ownership.

It warns of a three-tier race to find rented accommodation, with those at the top who can afford to pay rents, a ‘squeezed middle’ group who struggle to pay, and a bottom rung of 400,000 who risk being excluded completely.

However, there is hope for the lower tiers as leading landlord services provider Legal 4 Landlords can offer Rent Guarantee Insurance to landlords and tenants providing that the applicants pass the L4L Tenant Referencing criteria.

Kathleen Kelly, programme manager at the Foundation, said: “Our badly functioning housing system will see those on the lowest incomes really struggling to compete in the competitive rental market of 2020. Renting is likely to be the only game in town and young people are facing fierce competition to secure a home in what is an already diminished supply of housing. With 400,000 vulnerable young people, including families, on the bottom rung of a three-tier private renting system, we need to avoid turning a housing crisis into a homelessness disaster.”

The Foundation wants to see more homes built, longer tenancies at affordable rents – with the incentive of tax breaks for landlords – and the expansion of local letting agencies to find suitable homes for vulnerable young people.

David Clapham, lead author of the report, added: “With 1.5 million more young people no longer able to become home owners by 2020, it’s vital we take the opportunity to make renting work better.”

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