Podcast Summary
UK property sales transactions drop significantly in October: Sales transactions decreased by 52% compared to September and were 28% lower than October 2020. The rental market is facing a shortage of available properties. Investors need to be aware of changes in cladding and mortgage rules.
The UK property market saw a significant decrease in sales transactions in October 2021, with a 52% drop compared to the previous month. This decline was due in part to a surge in activity leading up to the government's stamp duty holiday deadline. However, it was also 28% lower than the same month the previous year. The rental market, on the other hand, is facing a shortage of available properties for tenants. Additionally, there have been changes in rules and developments in cladding and mortgages that property investors need to be aware of. It remains to be seen whether this decline in sales is a temporary trend or a sign of a larger market slowdown. Stay tuned for more updates and insights on the property market.
Shift towards buying properties in UK: 82% of UK properties listed for sale, 18% for rent. Rental shortage in scenic areas, leading to 6% UK rent increase, 16% in Dorset. Government lacks support for private landlords, city center rents recovering.
The trend in the UK property market is seeing a significant shift towards properties for sale and a shortage of rental properties, particularly in scenic areas. According to research, 82% of properties listed on major portals Brightmove and Zoopla are for sale, while only 18% are for rent. This trend is even more pronounced in areas like Cornwall and the Isle of Wight, where only 5% and 4% of listed properties are for rent, respectively. The shortage of rental properties has led to an increase in rental prices, with data from SUPLA showing that rents are up 6% in the UK when excluding London, which is a 14-year high. The highest rental price increases are in scenic areas like Dorset, where rents have gone up by 16%. The lack of government support for private landlords, who provide the majority of rental properties, could exacerbate this trend. Additionally, rents in city centers are also recovering and even outpacing rents elsewhere, with London, in particular, struggling over the last couple of years. These trends are not surprising to those following the property market and are expected to continue for the foreseeable future.
Growth in London rents, potential concerns in Wales: London rents rise 4.2%, Wales landlords face potential new costs including rent controls and council tax increases, impacting the rental market
Prime central London property market is experiencing a growth in rents, with a 4.2% increase over the last three months. This growth is attributed to the return to offices, international travel, and the easing of restrictions. However, a potential concern arises from a report in The Telegraph, which suggests that landlords in Wales could face new costs, including rent controls and a shake-up of council tax to become a new wealth tax. This could negatively impact the rental market in Wales, potentially causing investors to look elsewhere. While there are valid concerns regarding second homes being used solely for personal use and not for rental purposes, removing rental stock could lead to bigger issues. It's important to note that the proposed measures in Wales are still just statements of intention and not yet enacted.
Lessons from history for current political and economic developments: Politicians may discuss easing mortgage rules, but history shows they might not follow through. Forgetting past financial crises and relaxing regulations could have negative consequences for the housing market and economy.
History may provide some insight into current political and economic developments, particularly when it comes to regulatory changes and the potential for repeating past mistakes. For instance, the ongoing discussions about easing mortgage rules in the UK, which echoes similar conversations from six months ago in Scotland, serves as a reminder of the potential for politicians to talk about issues without following through on them completely. Moreover, the tendency to forget the lessons of past financial crises and relax regulations once economic conditions improve raises concerns about the sustainability of any easing measures. It's essential to keep an eye on such developments and consider their potential implications for the housing market and the broader economy.
New 40-year fixed mortgage rates in the UK: Lenders offer long-term fixed mortgage rates, backed by pension companies, providing certainty of payments and no early redemption fees. Pause on leaseholders' cladding repair payments while government reviews loan systems.
The mortgage market in the UK is seeing new developments, with lenders offering fixed mortgage rates for up to 40 years. This could provide homeowners with certainty of payments and no early redemption fees. However, these products are backed by pension companies, which are interested in long-term repayments. Meanwhile, there's a pause on leaseholders paying for cladding repairs, as the government reviews potential loan systems and alternatives. These developments could bring more choice to the mortgage market and bring some relief to those affected by the cladding scandal. However, the long-term impact and details of these changes are still uncertain and will be closely watched.
Housing market challenges: cladding issues and EPC ratings: Mortgage lenders unable to value buildings with cladding issues, over 2 million rental properties may not meet new EPC standards, and landlords face additional costs for carbon monoxide alarms.
The housing market is facing significant challenges, with concerns over the cost and feasibility of meeting new regulations. In the case of cladding issues, mortgage lenders are unable to value or issue mortgages on affected buildings, potentially leading to financial difficulties for leaseholders and even mortgage defaults. Meanwhile, the proposed changes to Energy Performance Certificate (EPC) ratings for buy-to-let properties, aiming to raise the minimum from F or G to C by 2028, could leave over 2 million properties unable to meet the standard, potentially leading to them being dropped from the rental market. The sheer scale of the required upgrades, coupled with the financial burden and logistical complications, may lead to exemptions being granted for properties that cannot reasonably meet the new standards. Another requirement, the installation of carbon monxide alarms in all private rental homes with gas boilers, adds to the financial strain for landlords. Overall, the housing market is facing a complex web of regulations and financial challenges, and it remains to be seen how these issues will be addressed.
New Carbon Monoxide Regulation for Rented Properties: Landlords must install carbon monoxide alarms in rented properties with gas boilers, as a new regulation comes into effect. Enforcing housing standards regulations leaves room for improvement, with many local authorities struggling to prosecute landlords for violations.
Landlords will soon be required by regulation to install carbon monoxide alarms in their rented properties if they have gas boilers. This is a change from the assumption that it was already a requirement. The enforcement of various regulations regarding private rented housing leaves room for improvement, with many local authorities having a poor record of prosecuting landlords for housing standards violations. While there are good, bad, and criminal landlords, the lack of significant enforcement action raises questions about the effectiveness of current regulations. Meanwhile, a new documentary called "Get Back" about the making of the Let It Be album by The Beatles is now available on Disney+, which offers a wide range of content beyond just Disney films, including Marvel, Star Wars, and Fox network shows.
Disney Plus: A Must-Have for The Beatles Fans and More: Disney Plus offers extensive content, including an upcoming Beatles documentary, and the property market podcast provides informative episodes on real estate. An extra special episode of 'Ask From Rob' is coming up.
Disney Plus is worth considering for its extensive content library, particularly for fans of The Beatles who are eagerly anticipating an upcoming documentary. Outside of this, the property market has seen significant activity in the past month, and listeners can look forward to more informative episodes on this topic and other topics in the upcoming weeks on the property podcast. An extra special episode of "Ask From Rob" is also coming up on Tuesday. Overall, there's plenty to look forward to in the world of podcasts and entertainment, so make sure to keep tuning in.
