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Landlords Lose Out Due To Unexpected Costs

Landlords Lose Out Due To Unexpected Costs

If You Fail To Plan Then You Are Planning To Fail

A recent survey by a national lettings agency has highlighted financial losses incurred by UK landlords due to failing to adequately plan for unexpected costs.

 Landlords pay on average around £1500 (GBP) per year of their rental income covering tenant rent arrears, maintenance, repair bills and void periods; a figure that equates to over £2 Billion (GBP) per year nationally, according to the survey by Northwood.

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Landlords Suffering Financially Due To Unexpected Costs

A recent survey by a national lettings agency has highlighted financial losses incurred by landlords due to failing to plan for unexpected costs.

Landlords Lose Out Due To Unexpected Costs

Landlords Lose Out Due To Unexpected Costs

Landlords pay an average of £1500 (GBP) per year out of their rental income on covering tenant rent arrears, maintenance and repair bills and void periods; a figure that equates to over £2 Billion (GBP) per year nationally, according to the survey by Northwood.

Continue reading »

The latest survey by the Association of Residential Letting Agents, (ARLA), has indicated that property rental prices within the Private Rental Sector (PRS) may be beginning to level out.

The ARLA survey quizzed 726 letting agents and over 1500 landlords, and the results showed that just 50% of all respondents reported an increase in their achievable rent level over the first three months of 2012, that’s 10% less than this time last year.

It also emerged that the average void period for rental properties in the PRS has increased to 3 weeks and the number of new tenancies being signed has reduced.

ARLA believe that the new figures indicate that tenants are staying in rental properties for longer periods of time, however some property pundits reckon it could be an early warning that private sector rental property demand is falling, or worse still it could mean that a growing number of tenants can’t afford to pay the rents being charged.

President of ARLA Tim Hyatt commented on the findings saying; “Data suggests that things could be changing in the private rented sector as the amount being charged for rent is beginning to stabilise in some parts of the UK. This could be due to a number of factors, including an increase in haggling, forcing rent levels down.”

Fresh research by YouGov has discovered that 80% of people living in the UK understand the full impact of the current housing crisis,

The survey revealed 80% of individuals in the nation would like to see more homes constructed, while 67% said that the current UK planning system needs speeding up.

Executive Chairman of the House Builders Federation (HBF), Stewart Baseley, said: “The study shows the vast majority of people in the UK are clued up on the current needs of the British property market. The housing shortage is having a huge impact on ordinary people, young couples who can’t afford to purchase a home and parents are being called upon to help their children to buy a house.”

The current situation is also affecting the hundreds of thousands of construction workers who depend on residential property building for income and have lost their jobs as a result of the economic downturn.

House Builders Federation members construct around 80 per cent of all new properties built in the UK every year.

House prices in England and Wales held steady in November, with no change on a month earlier and prices down 0.7% on the year, at an average £220,043.

According to the LSL/Acadametrics index, the only region recording annual price growth is London, where the value of the typical home has risen 3.1%.

November also saw an improvement in activity, with 4.5% more homes changing hands than this time last year.

LSL commercial director, David Brown, points out that static house prices don’t mean property values are standing still.

He explains: “For buyers looking to get onto the market, 0% price growth means that in real terms property is becoming more affordable. With inflation running at 5%, the real cost of property is getting smaller and smaller, which is good news for buyers and mortgage borrowers alike.”

According to Acadametrics chairman, Dr Peter Williams, the housing market in England and Wales looks as if it will end 2011 in better shape than expected.

As for the future, Dr Williams believes the outlook for transactions might weaken slightly in 2012, in the light of reduced confidence, tighter household budgets and restricted lending.

Buy To Let is expanding in the UK

UK PRS sees Strong Growth

The Council of Mortgage Lenders’ (CML), has noted that UK Landlords, Property Management Companies, Lettings and Estate Agents are currently seeing strong rental returns within the UK PRS, and this income improvement is likely to continue for the foreseeable future as the already high demand for private sector rented property continues to increase and many financial experts have also suggested the UK Private Rented Sector (PRS), will keep expanding over the next few years

The reasons behind the strength of the private rented sector include a shortage of social housing and the difficulty of would-be first-time buyers to be able to afford a home.

The Council of Mortgage Lenders noted that the UK Buy To Let sector offers, people who can’t buy residential property, multiple home options and some degree of quality of choice, whilst they save up to get their own foot on the property ladder.

The CML reported that the UK Private Rented Sector has been expanding rapidly over the last two quarters, with inward net migration one driver behind its growth in recent years, while some householders have decided to move into a leased property in order to rent theirs out to make extra money. A smart financial move, so long as they have remembered to get the correct permissions and suitable landlord insurance.

Many people are also choosing to rent property in the Private Rental Sector rather than becoming an UK home owner-occupier because it gives them more freedom and flexibility.

The fundamentals of growth in the number of UK households, combined with constraints on access to the owner-occupied and social housing sectors in the foreseeable future, suggest that over the next few years, demand for privately rented accommodation will remain strong and continue to grow.

The demand for UK Buy To Let properties is so strong at the moment that it is outstripping supply at an astonishing rate.

UK landlords could think about renovating unoccupied / empty properties or taking on repossessed homes in order to extend their property portfolio’s, to take advantage of the record numbers of people looking for rented accommodation.

Such prospective tenant demand means that UK landlords have the enviable position of being able to choose the best prospects for their properties, by means of thorough tenant referencing. Landlords are able to determine the financial backgrounds of all applicants prior to granting them an AST.

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