Written By Em

Em Morley

Average UK property prices to rise by 2.2% this year

Published On: April 20, 2017 at 12:10 pm

Tags: landlords,property market,property prices,UK house price growth

The average UK house price growth will hit 2.2% this year-a rise of £4,460, according to property consultancy BNP Paribas Real Estate.

If the forecasts are true, this means that the average price of property in the UK will hit £210,400 come Christmas.

Uncertainty

The predicted rise comes despite perceived market uncertainty surrounding the snap General Election called for June 8^th, alongside the ongoing Brexit confusion.

BNP Paribas Real Estate suggests that even London house prices will return to growth in 2017, increasing by 1.3% by the end of the year.

Over the next four years, prices in the capital are predicted to increase by 6.8% to £505,297.

John Slade, UK chief executive at BNP Paribas Real Estate, noted: ‘The big debate in London is the extent of the impact on the £1,000 to £1,500 per square foot market. While we have seen some adjustment, people now realise that high stamp duty may be here to stay and pricing has adjusted accordingly. While 2017 may be a year of relative stagnation this market should return to stronger growth thereafter.’[1]

Average UK property prices to rise by 2.2% this year

Trends

Simon Durkin, UK head of research at BNP Paribas Real Estate, also observed: ‘At a practical level, the story will become less about regional trends, with growth and activity focused on micro markets with a strong business and consumer economy. For example the North East features an extremely wide range of growth at a city level, with Newcastle Upon Tyne performing significantly more strongly than the regional average and likely to experience a less dramatic down cycle.’[1]

BNP Paribas Real Estate’s regional estimates for average property price growth by region by the end of 2020 are:

London +6.81%
South East + 17.29%
East Anglia +8.72%
East Midlands +13.07
West Midlands +13.59%
South West +22.21%
North West +7.63%
Yorkshire and Humberside +6.04%
Wales +4.26%
Northern Ireland +0.08%
North East -1.49%

[1] https://www.estateagenttoday.co.uk/breaking-news/2017/4/housing-market-good-news-price-growth-over-10-by-end-2020

Top 20 Homes Hotspots for Young Buyers Revealed

Published On: April 20, 2017 at 10:01 am

Author: Em Morley

Categories: Property News

Tags: homebuyers,house prices,property hotspots,young professionals

The popular seaside town of Hove has been named the top area in the UK for young buyers to purchase a home, according to a ranking of the top 20 homes hotspots for young professionals.

Landlords can use the list to choose their next property investment location, based on the fact that many buyers will choose to rent a home in their ideal hotspots before purchasing.

The East Sussex town on the south coast of England has an idyllic seaside location, good-sized homes and a family-friendly vibe.

While the average house price in the BN3 postcode is £380,000, three-bedroom houses priced between £700,000-£1m are the most sought-after, according to the Associate Director of Hamptons International’s Brighton and Hove branch, Paul Taggart.

Top 20 Homes Hotspots for Young Buyers Revealed

He says: “Generally speaking, these requests are coming from Londoners looking for a lifestyle change. People are looking for a less populated area than Brighton, with a more laidback vibe. Properties in Hove have a slower turnover because people put down roots.”

Hove also benefits from fewer tourists than neighbouring Brighton, plus there’s a good gastro-pub scene, and great state and private schools. Hove also offers direct train links to Victoria in just over an hour.

Nevertheless, Brighton’s BN1 postcode district, which stretches from the sea into the South Downs national park, is the seventh most popular area with young professionals aged 25-44, thanks to its buzzing nightlife, forward-thinking cultural scene and direct train links to London in under an hour.

Homes in Brighton are just £4,000 more expensive than in Hove, reveals the report from Lloyds Bank, which based its figures on Land Registry transaction data for the 12 months to February this year.

How does London compare?

Southwest London is particularly popular with young professionals, with nine areas in this part of the capital making the top 20 homes hotspots.

With average house prices of £763,000, Wandsworth’s SW18 is the most popular postcode area within Greater London, and the second most popular in England and Wales.

SW16 in fast-rising Streatham is the cheapest of the SW postcodes on the list, with average values of £468,000. Meanwhile, SW6 in Fulham is the most expensive, with prices just topping £1m.

Hampstead’s NW3 postcode is the most expensive district in the capital to make the list.

Kilburn, Paddington, Hammersmith & Fulham, and Chiswick, all in west London, also appear in the top 20.

Tower Hamlets is the sole representative of east London, with the E14 postcode ranking as the sixth most popular area in the country, in part due to its £526,000 average house price, which is significantly cheaper than the majority of the capital’s most popular postcodes.

The rest of the country

Reading in Berkshire and Didsbury in Manchester are the only two other locations outside of London to make the top 20.

In 18^th place, Reading offers 30-minute direct trains into the capital and an average house price of £265,000. With Crossrail due to connect the city to central and east London from next year, it’s also increasingly popular with Londoners looking for more space and better value for money.

Didsbury just makes it onto the list, in 20^th place. Averaging £260,000, homes in the area are the cheapest on the list, with young professionals drawn to its independent shops, and trendy bars and restaurants.

Landlords, do any of these homes hotspots appeal to you? Investing in these areas may open you up to a wide range of potential tenants looking for idyllic places to put down roots.

Women now account for 40% of landlords

Published On: April 20, 2017 at 9:57 am

Author: Em Morley

Categories: Landlord News

Tags: female landlords,landlords,rental market,women

Women now account for two in five landlords, with most using property in order to top up their monthly income.

Analysis of tens of thousands of landlords from Simple Landlords Insurance shows that 40% of landlords are now women. In comparison, just 17% of SME owners are female, which indicates that property could be moving towards equality at a quicker pace than other industries.

Goals

The investigation also showed that male and female investors have different goals for their investment. 63% of female landlords said using rent for monthly income was their goal, compared to 53% of men.

In addition, the research found that women are more likely than men to have become accidental landlords. 48% of female landlords said that they were ‘deliberate’ buy-to-let investors, in comparison to 61% of men.

Women were found to be more likely to have become landlords after moving in with their partner and renting out their own property.

Women now account for 40% of landlords

Acceptance

What’s more, female landlords are more likely to provide rental accommodation to a more diverse spectrum of tenants than men.

35% of female landlords said that they would rent their property to housing benefit tenants, in comparison to 25% of men. Women were also found to be more inclined to renting to students, pensioners and single tenants.

Alexandra Huntley, Head of Operations at Simple Landlords Insurance, observed: ‘As recently as 1970 women could be refused a mortgage without a male guarantor. But buying, selling, renovating, and renting property is no longer just for the boys. Those stereotypes are firmly consigned to history. Women have been steadily gaining ground over the last 50 years and are increasingly gaining financial independence through property investment.’[1]

[1] http://www.propertyreporter.co.uk/landlords/rise-of-the-modern-landlady.html

Is the mortgage market showing signs of stability?

Published On: April 20, 2017 at 9:12 am

Author: Em Morley

Categories: Finance News

Tags: landlords,mortgage market,mortgages,rental market

The most recent analysis from Mortgage Brain has revealed that the cost of mainstream mortgages continues to show signs of stability.

According to the report, there has been little movement in the market during the last three months.

Mortgages

Data shows that the cost of the lowest rate five year fixed mortgage (2.55%) fell by just 1% since January. In addition, the cost of a 60% LTV two-year fixed rate is only 1% than at the beginning of the year.

A 90% LTV two and three year fixed and a 60% LTV fix are only 0.2% cheaper than they were three months previously.

In comparison, a 60% LTV two, three and five-year tracker have all remained static.

Despite the short-term analysis showing little movement, the most recent product data analysis from Mortgage Brain shows year-on-year reductions in the overall cost of mainstream mortgages.

Is the mortgage market showing signs of stability?

The lowest 90% fixed rate now costs 5% less than it did at this time last year, while 60% LTVs costs 4% less than in April 2016.

Mark Lofthouse, CEO of Mortgage Brain, noted: ‘Our latest product data analysis shows that there’s little to get excited about in terms of rate and cost movement over the past three months. Following the long period of record lows, however, our short terms analysis can be seen as another sign that were moving towards a period of cost and rate stability, or even potential rises.’[1]

[1] http://www.propertyreporter.co.uk/finance/has-stability-arrived-in-the-mortgage-market.html

Lettings Market Shows Momentum in March, Finds Agency Express

Published On: April 20, 2017 at 8:49 am

Author: Em Morley

Categories: Property News

Tags: lettings market,property listings,rental properties,tax changes

Following a slowdown in the UK lettings market throughout February, the latest data from Agency Express’ Property Activity Index shows that the sector showed momentum in March.

Lettings Market Shows Momentum in March, Finds Agency Express

Across the country, new listings to let rose by 12.2% last month, while the number of properties let was up by an average of 16.4%.

Looking at activity across the lettings market in the UK, all 12 regions included in the Property Activity Index recorded growth in both new listings and properties let.

Top performers in the lettings market last month include:

Properties to let

Central England: +28.40%
London: +28.20%
South East: +22.90%
Yorkshire and the Humber: +19.50%
South West: +17.00%
Wales: +17.00%

Properties let

East Midlands: +32.20%
East Anglia: +31.10%
Central England: +19.80%
London: +19.60%
North East: +18.60%
West Midlands: +18.30%

March’s top performing region was Central England, with growth in new listings of 28.40% – the region’s largest increase for March since 2014.

London followed suit, with a 28.2% rise in new listings, marking the capital’s largest monthly increase for March since the records began in 2012.

The month-on-month data also highlighted a strong lettings market in the West Midlands. As the only region to record consistent growth since the beginning of the year, figures rose again for a third consecutive month. The number of properties let increased by 18.3%, while new listings were up by 8%.

Sales in the region also flourished last month, according to the latest sales index from Agency Express.

Stephen Watson, the Managing Director of Agency Express, comments on the latest lettings market data: “Throughout March, we typically see an increase in activity across the UK lettings market and, this month, figures did surpass those recorded in 2016. However, between the demand for buy-to-let loans seemingly decreasing since the Stamp Duty hike and the recent tax relief changes, it is difficult to say what the forthcoming months may hold. We may see some landlords selling off their properties as a result of the changes.”

Buy-to-Let Lenders Favouring Percentage-Based Fees

Published On: April 20, 2017 at 8:11 am

Author: Em Morley

Categories: Finance News

Tags: affordability,buy to let mortgages,finance,mortgage fees,mortgage rates

Buy-to-Let Lenders Favouring Percentage-Based Fees

Percentage-based fees for arranging loans have become the new standard among buy-to-let mortgage lenders, according to the latest Buy-to-Let Mortgage Costs Index from Mortgages for Business.

Flat fees have long been popular as a way for lenders to maintain profitability, while still offering competitive rates. Meanwhile, other products instead carry a variable fee based on the loan amount.

Figures from the first quarter (Q1) of 2017 show that 44% of all buy-to-let mortgage products now carry percentage-based fees, overtaking flat fees (41%) for the first time in four years.

There was also a rise in the average flat fee, up to £1,446 from £1,397 in Q4 2016. Together, these changes have increased the average effect of mortgage charges to 0.64%. This compares to 0.62% in Q4, and is the strongest effect recorded since the first half (H1) of 2015.

Steve Olejnik, the COO of Mortgages for Business, comments: “With the challenges lenders have faced to generate business in the face of successive blows to the buy-to-let sector, it is only natural that many have chosen to focus on cutting rates at the cost of increased fees. The recent trend towards percentage-based fees is an example of lenders doing exactly this, as fees of this type become more expensive for larger loans.”

The index also shows that there has been a shift in the pricing of five-years fixed rate products. Although products available at 75% loan-to-value (LTV) and below remained on trend, five-year fixed at higher LTVs saw a 0.2% rise in headline rates.

This was fuelled by an influx of investor demand following tighter Prudential Regulation Authority (PRA) affordability guidelines, which only partially apply to long-term fixed rates.

Landlords, have you seen a move towards percentage-based fees from buy-to-let lenders in recent months? Will this affect your decision to take out a loan?