Landlord press review

Like every month, Rentila offers you an overview of the main real estate news of interest to landlords and tenants. This month, we focus on: ONS sees prices up 1.8% in year to march as inflation falls further to 2.3%; Smaller homes drive house price growth; Mortgage rates will fall again, but not any time soon; Average UK rents close in on £1,300 a month; Why invest in a 2-bed apartment?; What is shared ownership? A myth-busting guide… Happy reading and… renting!

The market

Top 10 most affordable places for first-time buyers

The average asking price for a typical first-time buyer type property – deemed by Rightmove to be two-bedrooms or fewer – in Aberdeen is currently £102,602, with the average monthly mortgage payment now £406 per month.
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North vs. South: What the national average property price can purchase in 45 UK towns & cities

As part of their analysis, Mojo Mortgages analysed all 3,236 properties currently for sale between £255,000 – £265,000 in the UK’s top 45 most populous towns and cities. For each listing, Mojo Mortgages noted the number of bedrooms and bathrooms in each property, as well as the property type (semi-detached, flat, terraced, etc.) mentioned on the listing.
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ONS sees prices up 1.8% in year to march as inflation falls further to 2.3%

Average UK house prices increased by 1.8% in the year to March 2024, according to figures out today from the Office for National Statistics (ONS). This is up from the revised 0.2% fall recorded in the year to February…
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UK’s housing market booms as prices stabilise

The UK’s housing market is experiencing a sales boom with a 12% increase in agreed sales compared to last year, according to Zoopla’s research.
The property platform says this surge is down to more homes being available for sale and renewed buyer confidence.
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Smaller homes drive house price growth

Near-record house prices and high interest rates are forcing buyers to plump for smaller homes, Halifax has found, with flats and terraced houses leading overall UK price growth.
Demand for homes on the lower rungs of the property ladder is driving house prices up.
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Buy-to-let purchases hit record low

The proportion of buy-to-let properties purchased in Southern England dropped to a record low last year, continuing a trend seen since the stamp duty surcharge for additional properties was introduced in 2016.
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House prices edge higher despite base rate effect

The number of home appraisals fell 7% month-on-month as gross mortgage advances and new lender commitments fell, says the estate agents’ body in its March report.
The Bank of England is battling to bring down inflation, at 3.2%, to its 2% target.
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House price falls slowing in England and Wales

House prices in England and Wales are continuing to fall, but the rate of decline is slowing.
The average sale price of completed home transactions using cash and/or mortgages in England and Wales rose by a small amount (£127) to £359,154 in April.
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Mortgage

Mortgage rates will fall again, but not any time soon

Today it was the turn of NatWest and Santander to join the queue of major lenders to tweak their mortgage rates — and not to the advantage of borrowers.
Neither of the high street lending giants pushed through huge increases — mainly in the region of 20 basis points — but the direction of travel is clear and unhelpful.
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UK mortgage approvals rise in March despite stubborn interest rates

UK mortgage approvals for house purchases rose from 60,500 in February to 61,300 in March — the highest number of approvals since September 2022, according to the latest Bank of England data.
This equates to a monthly rise of 1.3% and an annual rise of 20%.
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Bank of England expected to hold interest rates

Markets put almost zero chance of a rate cut, which would only bring more pain to millions of mortgage holders, house hunters and borrowers. The monetary policy committee (MPC) is expected to keep the key rate unchanged at a 16-year high of 5.25%, where it’s been since August, but investors are keen to see if any other member will vote for a rate cut.
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How long-term mortgages could help solve the UK housing crisis

In the UK’s mortgage market, short-term lending dominates. The prevalence of short-term, fixed-rate mortgages has entrenched itself as a defining characteristic of the housing market – and for good reason. These types of mortgages serve large segments of the market effectively.
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Rent

Rent prices inch up as rental market grapples with supply-demand dynamics

Rental growth has moderated to +7.5%, a decrease from +9.8% recorded a year ago.
The cooling trend in rental inflation is evident across the UK, with London witnessing the most substantial deceleration.
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Year-on-year rents rise by 5.7% – voids remain stable

Rents continued their upward trajectory in April, with the latest figures from Goodlord showing a year-on-year increase of nearly 6% in England.
The average monthly rent now stands at £1,166, marking a £63 rise compared to April 2023.
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Rental yields for landlords hit highest level since 2018

Landlords are enjoying their highest rental yields in six years, with the average gross yield reaching 6.1% in the first quarter of 2024.
This is the third consecutive quarter of increases and the highest level since the second quarter of 2018 when landlords saw average yields of 6.6%, according to research.
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New Zoopla data shows Cambridge rent has shot up nearly 9% in a year

The average British tenant is now spending more than 28per cent of their pre-tax earnings on rent, the highest amount in a decade, new figures show. Data from property portal Zoopla showed that rent has been soaring faster than earnings for nearly two years and now accounts for 28.3pc of pre-tax earnings.
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Average UK rents close in on £1,300 a month

This rise means tenant housing costs are 7.9% higher than a year ago, according to the HomeLet Rental Index.
The biggest increase came in Greater London, where rents rose 3.1% in April to £2,167, 8.2% higher than a year ago.
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Rents could increase by 20% over the next year

The UK’s renters are facing rents climbing at an alarming rate this year after they rose by 1.6% in just one month, marking the fourth consecutive rise, data reveals.
The latest HomeLet rental index shows the average tenant is now paying an extra £21 per month compared to last month.
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UK rental market loses steam as sales activity eyes long term growth

The latest RICS UK residential survey reveals a mixed picture for the UK housing market with the sales market showing tentative signs of recovery – while the lettings market is cooling down.
It says that tenant demand is losing momentum, with respondents reporting a drop in new instructions from landlords.
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Edinburgh named the second least affordable Scottish city for renters

Overall, Stirling came out as the least affordable Scottish city to rent in (it took fourth place in the UK-wide table), with tenants here typically seeing 43.5% of their net (take-home) income going on their rent. The national average is around 5% less (38%).
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Advice

Why invest in a 2-bed apartment?

Changing lifestyles in the UK mean that apartments have become some of the most popular assets for property investment. However, many investors are faced with the dilemma of choosing a 1-bed or 2-bed apartment.
Size is an important factor when making a buy-to-let property investment, and the type of property you choose is key for targeting specific demographics and maximising returns.
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Top tips for landlords to attract the best tenants

The last year or two have very much been a seller’s market in residential lettings, with as many as 20 applicants for every vacant home.
But that doesn’t mean that landlords shouldn’t be making an effort to attract tenants, both because the market will always readjust eventually and, even in the current environment, the quality of your tenant is very important.
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Other

Stamp duty charges plunge 24% to £11.6bn

UK property transactions fell by more than a fifth to 1.2 million homes in the year to March, while mortgage lending last year was down 23% to £130bn, according to UK Finance.
But last month as the market picks up this year, stamp duty charges for homebuyers lifted 10.6% to £864 from February…
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Landlords could face a two-year wait to sell or reoccupy under Labour plan

Labour’s shadow housing secretary, Matthew Pennycook, has proposed a significant change to the Renters (Reform) Bill which would require landlords to wait two years from the start of a tenancy before they can sell or move back into their property.
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Can first-time buyers get a Buy-to-Let investment in the UK?

If you’re a first-time buyer looking to purchase a buy-to-let property, you’re in luck. Many investors do not realise that you don’t need to own a residential property to invest in the UK buy-to-let market.
However, there are some things you should consider before taking the plunge.
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50,000 rented homes needed to help ease shortage

The UK’s rental market continues to face a significant supply shortage, and despite recent signs of improvement 50,000 homes are needed to bring supply back to pre-pandemic levels…
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Nearly half of all advertised rental homes are unavailable for immediate occupation

There’s a critical shortage of homes to rent across England, with less than half of those advertised being ready for tenants to move into, research reveals.
The findings highlight the imbalance between supply and demand and the urgent need for more landlords in the private rented sector.
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What is happening with the Renters Reform Bill?

The Renters Reform Bill was introduced into Parliament in May 2023 and has just finished its third reading in the House of Commons.
It will now make its way through the House of Lords, where it will face further scrutiny by peers. It is likely to see further changes before it is passed.
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London’s landlords feel the squeeze as tenants push back

The good news for renters in the prime areas of London is that rocketing rent increases are finally easing up, one rental index reveals.
Rent growth in prime London postcodes has narrowed to levels that haven’t been since seen the summer of 2021.
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What is shared ownership? A myth-busting guide

Shared ownership (SO) is when a buyer purchases a share of a new build property and pays rent and a service charge to a housing association on the remainder.
The advantages are that you can get on the property ladder with a much smaller deposit (it only needs to be a percentage of the share you’re buying, rather than the entire property)…
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