Your local Lettings expert, helping Landlords and Tenants

During these times our Lettings team has been working hard, not just finding homes for people during the Coronavirus crisis, but sorting maintenance issues, conducting viewings within the guidelines and keeping on top of ever changing legislation and communicating that to our Landlords. We hope this Lettings dedicated newsletter will go someway to inform, engage and enlighten those that are already landlords, those second home owners considering renting their property and tenants thinking of making a move. Our team are on hand, albeit working from home, to help, advise on why having your property managed could be the best way forwards, undertake viewings either virtually or within guidelines, or just for a general chat on 01903 744166.

Landlords and how we can help you..

Whether you're an experienced landlord or looking for your first buy-to-let we can advise you on the local rental market. We're local so you don't have to be, so let our dedicated team take care of everything, from the first meeting, to a tenant moving in and beyond we're here to help you every step of the way. Our careful tenant vetting and different options for landlords will provide you with a secure, reliable let - just check our website for our 7 Steps to Letting, Landlord information centre and more. We know what landlords and tenants want and work alongside you to ensure your property is managed properly and to inform and guide you through latest legislation and ARLA guidelines.

Click here to read Landlords and how we can help you...

Rental market in prime position to bounce back

The effects on the property market of Covid-19 are clear; with the general populous on lockdown there are bound to be fewer movements. However, new research from the Zoopla Rental Index has indicated that people are already making rental plans for once the lockdown period is over, a positive sign for the lettings market.

In the two weeks to 14th April, demand for rental property increased by almost a third, albeit this is following the downturn due to the coronavirus in March which saw a 57% fall in demand. Year on year, rents are up 2.4% which is largely in line with annual growth seen towards the end of 2019 and in February of this year. Essentially, we are seeing demand for rental properties growing much more quickly than for sales properties, and rents are holding steady in unfavourable conditions.

“The flexibility of the rental market is one of the key factors which has allowed activity to bounce back more quickly than other parts of the property market,” said Gráinne Gilmore, head of research, Zoopla. “The rise in demand in the first two weeks in April indicates that some tenants are already mapping out their next move.

“As with the whole housing market however, activity levels and rental growth will likely be closely aligned to the economic landscape of the UK once the lockdown eases and the immediate impact of Covid-19 starts to recede.

“Rental growth has increased steadily for the last 3 years as demand has increased in the face of dwindling new supply. However, If the responses to COVID-19 contribute to a rise in unemployment, as some official bodies have forecast, this will reduce the scope for any additional growth in rents. We expect growth to moderate this year, but to remain in positive territory.”

Potential Landlords still keen to Invest

Given changes to stamp duty, tighter regulations and the introduction of the Tenant’s Fee Ban last year, it’s easy to assume that there’s little appetite in the market or encouragement for landlords to invest in Buy-to-Let properties. However, a recent large-scale survey has suggested that such a sentiment is far from reality.

Perrys Chartered Accounts asked 1,000 people and discovered that close to 75% of those questioned backed the idea of investing in Buy-to-Let properties, with that number rising to 83% when looking at millennials (those born between 1981 and 1996).

Why not invest?
So, what’s stopping them? The survey noted that increased tax and stamp duty rates are understandably off-putting, with Brexit unsurprisingly playing its part in making buyers think twice when deciding to invest.

What can be done to encourage investment?
Investors will likely all note that a decrease in stamp duty would be preferable, and a similar sentiment is shared in Perrys’ survey alongside a wider selection of tailored mortgage products. Interestingly, over one fifth of those questioned were keen to explore alternatives to long-term property investment with longer tenancies, such as short-term lets.

Preparing for the future
When it came to detailing reasons for wishing to invest in such properties, a willingness to fund a pension alongside replacing their current stream of income and building an inheritance were all noted as key factors for potential investors.

"It’s interesting that the younger generation still sees [buy-to-let] as a way to plan financially for the future,” noted Donna McCreadie, a Buy-to-Let tax specialist at Perrys. “However, there are many things to consider before jumping in, including stamp duty charges, how income tax might be affected and what the return on the investment is likely to be.

"Investing in a property is a long-term plan rather than a quick fix to financial freedom so it’s important to gather as much information as possible and speak to a professional tax specialist and mortgage advisor before making a commitment," she says.

Tenant Demand showing no signs of Slowing Down

The opportunities available for landlords on the property market are better than ever in 2020. Demand from prospective tenants has remained strong over the past year and is showing no signs of slowing down. This makes it the perfect time for landlords to expand their portfolio to meet the demand; with rental properties being snapped up in no time.

The considerable competition tenants are experiencing battling for viewings reduces the risk of homes being left vacant unexpectedly; leaving landlords with increased peace of mind. Findings reported by Home Let show that there has been an increase in rental value across the whole of the UK. The North lead this variation with the North West rental value increasing by a staggering 8.3%, and seven UK regions are each reported to have more than a 5% increase.

As well as higher demand, the rents increase can also be linked to a number of societal factors. There has been a resilient economy, higher wages, with low unemployment rate, allowing private tenants to still afford the rise in price. The Tenant Fees Act which was thought to move some of the fees from tenants to landlords, seems to have actually found its way back to tenants in the higher rent prices. There has also been a rise in the average age of renters, also adding to the demand.

David Cox, chief executive of ARLA Propertymark, said “looking ahead to 2020, we hope the government recognises the importance of increasing supply for tenants and uses it as an opportunity to make the market more attractive for landlords. This will encourage more landlords back into the market as well as ensure that tenants, including those who are most vulnerable, are not at a disadvantage in being able to find a suitable and affordable home to rent.” The rental market has shown great resilience over the past year despite the Brexit implications remaining unknown. The strength of the private rental sector is set to continue into 2020 conforming to the basic economic principal of supply and demand.

Electrical Safety Regulations to come into place for Landlords

The first new landlord legislation of 2020 has been proposed, and relates to electrical safety checks. If you are a landlord of a property, then the proposed new regulations could affect you from 1st July this year.

Subject to parliamentary approval, from summer this year landlords will have to ensure electrical installations inspections and testing are carried out for all new tenancies, and for existing tenancies the regulations will be applicable from April next year.

In a bid to improve the safety of tenants across the United Kingdom, the Electrical Safety Standards will mean that electrics in properties should be safer and more uniform, with landlords required to produce copies of inspection reports to tenants, and the housing authority if requested.

David Cox, ARLA Propertymark Chief Executive, commented on the regulations; “We are supportive of this concept and believe it will create a level playing field for all agents and landlords as well as ensuring improved safety standards for tenants. Mandating inspecting and testing of every fixed electrical installation should have a limited impact on good professional landlords and agents in the market, many of whom already voluntarily undertake these inspections. We did raise concerns about the number of engineers available to undertake these reports by the April 2021 deadline but have received assurances from MHCLG this morning about capacity in the supply chain.”

If you are concerned about how the new regulations may affect your properties, don’t hesitate to contact us and we will be happy to advise you.