LANDLORD NEWS
Rents hit a record high
A shortage of available properties has helped drive rental prices to a record high, data from Rightmove shows. Average asking rents outside London have reached an all-time high of £1,190 a month, while in London the typical rent is now above £2,500. Rents rose 9.4% over the past 12 months on average. Rightmove identified High Wycombe in Buckinghamshire as having the largest annual change with a 22.4% increase. Rightmove said there were signs of more properties coming on to the market. In Scotland, rents in the first quarter of 2023 rested at £957, marking an annual change of 12.3%. Wales experienced an annual change of 11.9%, with average rents reaching £987. Although the number of properties available to rent in Q1 was up 8% year-on-year, the number was still nearly half that seen in 2019.
Sky News BBC News City A.M. Daily Mail London Evening Standard The Independent UK
BUY TO LET
Best UK cities to invest in property outside London
Research by property experts Redmayne Smith has revealed that both Glasgow and Manchester were the best UK cities to invest in outside of London, scoring 28 out of a possible 30. Glasgow came out on top when it came to rental yield with 6.8%, giving them a perfect score of 10. The Scottish city also came out on top when it came to annual property value percentage increase (14.1%). Manchester scored particularly highly when it came to annual property value percentage increase (15.6%). Sheffield, Bristol and Edinburgh completed the top five with rental yield scores ranging from 5% to 8% and annual growth percentages from 7% to 8%. Bristol and Edinburgh topped the list for house prices, suggesting they would be more appropriate for investors looking to benefit from regions with less risk of market downturn and higher rental prices.
Express.co.uk
Considering returns when investing in BTL
Buy-to-let investors have previously received net returns as high as 82% over five years, but not all areas will be as profitable as others. Two major factors that you need to consider when investing are rental yields and capital growth. When both are taken into account, London offers lower returns than any region in England and Wales, according to Hamptons. Investors in London received a net return of 18% from 2018 to 2022. Investors fare worse in London because the cost of buying a property is so high. The second-lowest region for returns – the South East – also has the second-highest average price paid by investors. Even if capital growth is not factored in, London still comes out as the worst option for investors in England and Wales. The average yield is 5%, which is far lower than the 7.3% that can be achieved in Wales and the North West.
The Daily Telegraph
The best BTL locations for £25,000
The Telegraph looks at the best places to invest with a cash budget of £25,000, enough to cover a 25% deposit and stamp duty, using data from Hamptons estate agency. The highest yielding location for landlords with £25,000 to spend in England and Wales is Hartlepool in north east England. The port is a rental hotspot for modest budgets, with an average gross yield of 9.7%. Next door in County Durham investors can find the second highest yields of 9.2%. The borough of Blaenau Gwent has the highest rental yield in Wales for investors with a £25,000 budget, at an average gross rate of 9.1%.
The Daily Telegraph
Holiday homes earn up to £36k a year and pay less tax
Harvey Jones in the Express reports on how holiday lets can bring in as much as £36,000 in annual income. A four-bedroom house in Cumbria & the Lake District could earn the owner £36,000, followed by the Peak District with an average £33,000 income, then Cornwall and Devon in joint third place earning £32,000. Jones notes that holiday lets have several tax advantages over buy-to-let. Owners may register as a business and pay business rates instead of council tax, which are often lower. They can also offset operating costs against tax, for example washing and cleaning costs, as well as furniture and equipment. However, lending for holiday lets is often tighter than for buy-to-let, said Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “With less competition and choice, rates tend to be higher.”
Daily Express
COMMERCIAL
London nightlife venue to become offices
The Printworks building in Docklands is to be transformed into a vast new workspace hub for south-east London called the Grand Press. The plans, unveiled developer British Land, show how the structure, better known recently as a nightclub venue, will be turned into a seven-storey complex centred around an atrium in the former printing hall. It will have 158,000 sq ft of workspace, as well as shops and restaurants, and a new cultural venue. The plans form part of the Canada Water Masterplan led by British Land and pension fund AustralianSuper.
City A.M. London Evening Standard
AUCTION NEWS
iamproperty new index tracks MMoA sales
New research has revealed that agents working with auctioneer iamproperty recorded record sales under the hammer during the first quarter of 2023. A new Online Auction Index created by iamproperty seeks to provide a quarterly market overview and forecast for the Modern Method of Auction (MMoA) sector. Its first report suggests the proptech firm has experienced its most active quarter to date. During the first three months of the year, 2,252 properties were sold which is up by 56% annually, with £387.9m worth of property sold, up by 48%. Agents have earned a record £7.8m in fees, also up by 48% when compared to the same quarter in 2022. Regional sales are strongest in the South, which has also seen the biggest increase, 78% since the same time last year. Co-founder of iamproperty Jamie Cooke said: “Rightmove’s House Price Index is a really useful data point giving a wider market analysis, but the industry was missing a dedicated source of information for online auction, which has evolved at speed over the last few years. Vendors want choice and are increasingly motivated to explore an alternative method of sale with the benefit of speed and security. The Modern Method of Auction market has never been more active – the demand is there and growing month on month.”
Estate Agent Today
Hampstead townhouse smashes guide price
A Hampstead townhouse that has never before been on the market sold for £1.81m at auction, smashing its guide price. SDL Property Auctions had estimated the final price for 2 Well Road to be between £850,000 and £1m, but a few tenacious buyers drove it to more than double the lower estimate. Taking auction fees into account, the unknown buyer will be handing over close to £1.9m for a home with threadbare carpets, peeling plaster walls and a catalogue of mystery stains.
London Evening Standard
Auctoneers issue warning over two-bed up for auction
A two-bedroom house in Wednesbury, West Midlands, is attracting viewers with its low price-tag but auctioneers warn that ‘extreme care’ must be taken when entering the property due to its dilapidated state. The warning was issued to potential buyers of the property, which has come onto the market for £10,000. Bond Wolfe auctions, who are auctioning the property on 18th May, said: “Due to the condition of this lot, auctioneers advise that appropriate clothing and footwear should be worn when viewing the property. A torch may also be required.”
Daily Mirror
PROPERTY FINANCE
Older generation dominates UK’s housing wealth
The over-65s have a record £2.2trn in mortgage-free housing wealth, double the total a decade ago, underscoring the generational divide in the housing market. The amount of mortgage-free equity held by the over-65s has doubled in the past decade, rising by £1.11trn to reach £2.183trn. In addition, landlords in this age bracket own £405bn in mortgage-free rental properties, leaving over-65s with a total of £2.588trn tied up in bricks and mortar. Just behind them are owner-occupiers aged 50 to 64, who hold £1.53trn in housing wealth, along with £679bn tied up in rental properties, a total of £2.213trn. Putting the two age groups together, over-50s in the UK hold 78% of the country’s entire privately held housing equity, according to Savills. The data also shows that over-65s have £147bn in mortgage debt – only 5% of the overall value of their properties. By contrast, mortgages account for 52% of the value of the properties owned by under-35s. The mortgages of the youngest generation are double the value of those held by over-65s.
The Times Daily Mail Daily Mirror
Beach huts see 43% rise in prices
The price of beach huts in England’s seaside resorts has soared by 43% to an average £50,000 in the past year. And despite the cost of living crisis, those in top locations have more than doubled – with some topping £120,000, a study by home moving specialists Moverly found. The most expensive are in Dorset, with the average price there increasing by 101% to £123,424. Kent and Essex rank as the second most expensive beach hut hotspots at £42,257 and £42,008 respectively. West Sussex who has seen the second highest annual rate increase, with the average asking price up by 77% in the last year. Moverly said: “The UK property market may be slowing under economic uncertainty, but it certainly doesn’t seem to be impacting the great British beach hut.”
Daily Mail Express.co.uk The Sun
LENDING CONDITIONS
Choice of mortgage deals tops 5,000
The total number of mortgages on the market has topped 5,000 for the first time since May last year. Moneyfacts counted 5,146 residential mortgage options available in April. Looking at different loan-to-value (LTV) tiers, Moneyfacts said the choice of deals for people with a 40% deposit, or a 15% deposit, is the highest on its records. It counted 702 products available for people with a 40% deposit and 806 deals for borrowers with a 15% deposit. However, higher mortgage rates will eat into borrowers’ costs. Moneyfacts said average two and five-year fixed-rates rose between the start of March and the start of April, to 5.35% and 5.05% respectively. At the start of March, the average two-year fixed-rate was 5.32% and the average five-year fixed-rate was 5.00%. Looking at variable mortgage rates, the average two-year tracker deal has breached 5% for the first time in 14 years, to sit at 5.02% in April, Moneyfacts said. The average standard variable rate (SVR) mortgage in April was 7.30%.
London Evening Standard The Independent UK
‘Abandoned’ first-time house buyers fuel demand for 35+ year mortgages
The Labour Party has said only a third of people born in Britain today will own their own house by the time they reach 50 years of age. Shadow housing secretary, Lisa Nandy, referred to a study by the English Housing Survey which showed the proportion of homeowners aged 45-54 had fallen from 74% in 2009/2010 to 65.5% in 2021/2022, a trend that would see homeownership fall to 30% by the 2070s. Shadow Chancellor Rachel Reeves said 600,000 families have re-mortgaged onto higher rates in the past six months, and 360,000 households have re-mortgaged onto rates more than double their original. Suffering house buyers are paying more than £4,000 more per year than they would’ve done in February 2020. Labour declared it is now “the party of homeownership” as it pledges to support young people and families to get onto the housing ladder. As well as reforming the planning system to get more houses built, it has promised to help first time buyers by introducing a comprehensive mortgage guarantee scheme for those struggling to save for a deposit.
Daily Mail Mirror.co.uk The Independent UK The Sun
First-time buyers take a £220k gamble to get on the ladder
First-time buyers using ultra-long mortgage terms to get on the housing ladder face paying an additional £220,000 over the lifetime of their loan. Brokers have reported a rise in clients taking out mortgages with 35 and 40-year terms. This comes as new data from UK Finance shows the number of people taking out these mortgages has more than doubled since the beginning of last year. If a first-time buyer was to borrow £450,000 over a 25-year period with a 4.5% interest rate, they would pay back £751,000 over the course of the term. If they were to extend the term by 15 years they would reduce their monthly payment by £480, down to £2,000. But they would ultimately pay back £972,000. The analysis was carried out by broker Private Finance and assumes the interest rate remains at 4.5%.
The Daily Telegraph
Equity release uptake declines
Data from the Equity Release Council shows that the number of people releasing equity from there property fell by 29% in Q1 compared to the first three months of 2022. This follows a sharp rise in equity release rates, which hit 8% last November. Moneyfacts figures show that rates currently average 6.21%, exceeding the averages of 3.85% seen in January and 4.16% recorded at the start of 2022. The Equity Release Council said the number of new and returning equity release customers active in Q1 dipped to 16,691, down 19% from the 20,597 recorded in Q4 2022. Total lending is also down, hitting £699m in the first three months of this year. New customers reduced their loan sizes in Q1, with the average first release from a new drawdown lifetime mortgage down 34% year-on-year to £61,785.
Mail on Sunday
ECONOMY
Insolvencies up 18% in Q1
The number of companies declared insolvent in England and Wales increased by 18% year-on-year in Q1. Data shows that 5,747 companies were declared insolvent in Q1, with the total close to the 13-year high of 5,969 recorded in the final quarter of 2022. Analysis by PwC shows that 98% of liquidations and 70% of administrations were from firms with turnover of less than £1m. PwC said: “We’re seeing an increasing domino effect of insolvencies where firms fail and are unable to pay their debts, thus causing the failure of other firms to whom they owe money.” The Insolvency Practitioners Association said: “The significant year-on-year rise in corporate insolvencies has again been driven by creditors’ voluntary liquidations, rather than looking at rescue options.”
Daily Mail The Independent The Times
