The Guaranteed
Rent Specialists

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Year: 2020

  • Rent in London: cost of a room plummets by as much as a third in some central postcodes

    Rent in London: cost of a room plummets by as much as a third in some central postcodes

    Continued disruption caused by Covid-19 is pushing young renters out of the capital to work or study from home outside the city centre.

    Londoners looking for a room to rent in the capital are in line to make major savings on their housing costs after lockdown led many house sharers to flee the city, at least temporarily.

    The cost of renting a room in London has fallen by 2.6 per cent compared to last year’s prices, pushing the average price of renting in a shared house or flat down to £728 per month, according to data from Hamptons International shared exclusively with Homes & Property.

    The fall was driven by large price cuts in Zone 1 — where housing costs are generally highest — with a drop of 11.8 per cent pushing room rents down to £1,021. This is a saving of £136 per month.

    Zone 2 room rents were down 9.7 per cent to £775 per month.

    By comparison, rents rose slightly in Zones 5 and 6, up 2.5 per cent and 2.1 per cent respectively, while rents in Britain as a whole rose by 6.1 per cent.

    “A high proportion of the rooms rented in London are in the inner zones because people have often been willing to sacrifice having their own space to be next to a Tube station or really good amenities. For the price of a room in Zone 1 you can often get your own one-bed in Zone 4,” says David Fell, a senior analyst at Hamptons.

    In the wake of coronavirus lockdown, which has seen many office workers told they will be working from home until at least summer next year, many central London renters have moved out to the suburbs or even further afield in search of a larger home to live and work in — and ride out any future lockdowns.

    Fell says this is compounded by a drop in the number of students moving to London to attend university in person. There has also been a fall in new graduates making the traditional move to the capital because most of those who are lucky enough to have scored a job will be starting their working lives remotely.

    Many landlords who would previously have made more money by renting a property room by room are now opting to take a price hit and rent the entire property to a single family in the hope of a longer tenancy.

    Where have London rents fallen the most?

    Separate research from SpareRoom found also showed room rents falling compared to the same period last year.

    The biggest discount was in Aldgate, EC3, where room rents dropped 34 per cent to £983 per month. This was followed by the W9 postcode, covering Maida Vale and Little Venice, where room rents fell 20 per cent to £824; and SW1, home to Westminster, Belgravia and Pimlico, where rents dropped 17 per cent to £922 per month.

    Room rents in North Kensington (W10), St John’s Wood (NW8), and Holland Park (W8) all fell by 16 per cent, according to the flat sharing website.

    “Once again, London dominates the headlines in terms of falling rents, and it’s generally the most expensive neighbourhoods that are worst affected,” says Matt Hutchinson of SpareRoom.

    “With so many young renters leaving the capital, either to find cheaper rents, to move with family, or to leave the UK altogether, it’s hard to know when, or even if, London will regain the appeal it had before the pandemic.

    “What we’re seeing might just be a temporary shift in the rental market, or it may be the start of the UK’s rental map being redrawn permanently.”

    Tenants in shared housing tend to be able to move more quickly in response to changing circumstances.

    “We don’t expect London room rents to increase this year but renters may find themselves returning to the inner city if they end up working in their office more than they’d anticipated, for example,” says Fell.

    Swapping east London for Wales

    “I went back to my mum’s in Wales on annual leave back in March, thinking I’d be there for a couple of weeks… and then lockdown happened,” says Aneira Davies, a freelance journalist.

    “At £500 per month my room rent on my house share in Ilford was cheap — but my landlady very kindly gave me a rent break while lockdown was on, so I decided to stay put and enjoy the space and countryside on the doorstep.

    “It would have been really hard to work from home in my shared house, where I had a tiny room and a shared living space. At Mum’s I have a much larger bedroom and can work between the lounge and the dining room.

    “Staying at Mum’s has taken a lot of the financial pressure off, which is a relief because since lockdown happened a lot of my freelance work has dried up. I gave up my room in August as the rent break was about to end and will be staying out here until at least next year, when I hope work will have picked up again.

    “It’s great having all the space and enjoying some family time but I really miss London, especially seeing my friends, going to the flower market at Columbia Road on a Sunday and exploring different parts of the city.”

    Blog Post from Evening Standard H&P

    See details of our Guaranteed Rent Scheme here

  • New Homes Along The London Outer Orbital

    New Homes Along The London Outer Orbital

    We find new homes along the London Outer Orbital Path, from Cockfosters in north London to Purfleet in Essex.

    The third and final part of our search for new homes along the London Outer Orbital Path — the Loop — on behalf of post-lockdown buyers seeking more space and greenery, takes us from Cockfosters to Purfleet, through coveted north and east London suburbs before reaching the raw beauty of the Thames Estuary marshlands.

    Close to Hertfordshire, on the edge of the green belt, Cockfosters and its prosperous neighbour, Hadley Wood, form a hinge between town and country, with several renowned golf courses including one with a Georgian clubhouse set on a hill surrounded by parkland.

    Highstone House is a traditional-looking scheme of flats in gated grounds, halfway between the two locations. Prices start at £795,999. Call Shanly Homes on 01494 683917.

    Nearby Trent Park was a Tudor hunting ground and is now a smart new address. The 413-acre estate’s listed mansion is surrounded by nature trails, bike paths, lakes, woodland and a wildlife sanctuary.

    Developer Berkeley Homes is building clusters of semis and detached houses plus new apartment blocks in 56 acres of private grounds, while older structures including a former dairy are being converted.

    There’s a gym within the original orangery, an outdoor swimming pool, tennis courts and a courtesy shuttle bus to Oakwood Tube station, which has 26-minute trains to King’s Cross on the Piccadilly line.

    Prices from £565,000 to £1,995,000. Call 020 3944 1855.

    new homes along the London Outer Orbital Path near Enfield, north London

    The River Lee and the Lee Navigation brought industry to Enfield in the late-Victorian period but there’s plenty of green space, too, while eco-friendly new districts are sprouting up on big parcels of “brownfield land”.

    The biggest of these is Meridian Water, 210 acres next to Lee Valley Regional Park, a vast green swathe stretching from Docklands to Hertfordshire. The £6 billion project is bringing 10,000 homes.

    A new railway station opened last year with 25-minute trains to Liverpool Street. It’s early days but worth exploring.

    Elements is a development of 993 homes opposite nearby Ponders End train station, which links to the scheme via a new square. Prices from £330,000. Call Countryside on 020 3797 1868.

    Green hotspots in east London and Essex

    The Loop continues on to the suburban strongholds of Chingford and Chigwell, with giant green “back gardens” in the form of Epping Forest and the Roding Valley.

    Oaklands Hamlet, set in 53 acres on the outskirts of Chigwell, has a tree-lined entrance avenue, a village green and incorporates a new country park. Detached houses cost from £699,950. Call Countryside Properties on 020 3930 2690.

    Foreign exchange broker Jamie Monk, 26, works at Canary Wharf. “I loved the idea of being surrounded by parkland and greenery while still being so well-connected to central London.”

    He paid £275,000 for a one-bedroom flat and expects to trade up to a house.

    Past Chigwell, the route meanders through woodland and farmland, making this one of the most rural sections of the Loop.

    Yet it’s still well connected, via the Great Eastern main line and Central and District line Tube.

    The Crossrail bonus in Essex

    Crossrail is also reaching into this part of Essex. Havering, London’s most easterly borough, is getting three Crossrail stations, at Romford, Gidea Park and Harold Wood.

    Onwards to Upminster Bridge, on the District line. For decades the town has been shifting from farming to a garden suburb.

    To the north and south is green belt. Follow the River Ingrebourne to Rainham, developed into a London suburb after the First World War.

    A new train station is being built at Beam Park, a former Ford factory being turned into a 3,000-home neighbourhood on the c2c line connecting the City to the Essex coast.

    Prices from £240,000. Call 020 3733 1592.

    New homes for rent and sale in Purfleet

    The Loop ends at Purfleet’s awesome riverside marshes and mudflats, one of the UK’s richest wildlife habitats.

    Purfleet is a key part of the Thames Gateway development zone stretching from Docklands to Tilbury. It has a big freight terminal but the town is a conservation area, too, with a military garrison that’s a scheduled Ancient Monument.

    A £1 billion town centre regeneration has the green light from Thurrock council. This will bring 2,850 new homes, a new train station, two schools and one of Europe’s biggest media villages.

    A giant coup for the area is the relocation of the Royal Opera House set production workshop and costume centre.

    Other arty organisations, such as Acme Studios, which provides affordable workspace for artists, have followed.

    The 143-acre waterfront site will get a new boardwalk esplanade, plenty of green space and woodland plus new flood defences.

    Homes, to be built by Swan Housing, will be for rent and for sale, with at least half of modular construction, an eco-friendly factory system that keeps prices more affordable.

    The aim is to encourage young families in particular to settle. To register, call 0300 303 2500.

    Blog Post from Evening Standard H&P

    See details of our Guaranteed Rent Scheme here

  • London House Prices Post-Lockdown

    London House Prices Post-Lockdown

    London house prices post-lockdown reached an all-time high in August, with the fastest annual rate of increase since April 2017.

    The mini-boom in London house prices post-lockdown picked up pace in August when prices in London rose to an all-time high.

    The average cost of a home in the capital increased 3.5 per cent to £489,159, beating the previous record of £488,527 set in July 2017, according to new figures today from the Land Registry.

    That is the fastest annual rate of increase since April 2017 and means that the average price has gone up almost £17,000 since the market was reopened in May.

    Nicky Stevenson, managing director at state agent group Fine & Country, said: “Here is official confirmation that the market did indeed get up to a canter over the summer months.

    “The annual rate of growth soared as buyers frustrated by lockdown and lack of space crammed into the market in search of larger properties. That alone explains this year’s sudden rally, as the stamp duty holiday was only introduced in July. A lag will mean any extra demand it created will not be seen in the Land Registry figures before the end of the year.”

    Lucy Pendleton, co-founder of London agents James Pendleton, said: “As long as mortgage repayments remain cheaper than the cost of rent, demand to buy a first home will continue to show strength, and first-time buyers everywhere are still able to turn to the Help to Buy scheme if they need to.”

    David Westgate, chief executive at agents Andrews Property Group said: “It’s no surprise average annual house prices in August were up on July, as they will have been driven north by the post-lockdown surge in demand.

    “September is likely to see an even sharper upswing in average annual completion values as by that point we will start to see the impact of the stamp duty holiday announced in July.

    “Now, in October, the market has started to cool off as lenders grow more conservative and higher loan-to-value buyers struggle to secure mortgage finance.

    “As we enter the winter months we’re expecting to see a lot more activity from landlords and people who have decent equity in their homes as we transition to a buyers’ market. Cash rich buyers will sense an opportunity and act accordingly.”

    Andrew Southern, chairman of property developer Southern Grove, said: “Homes are flying off the shelf and this trend still looks like it has further to run. If true, it will have taken a pandemic to shift transactions up a gear and the irony won’t be lost on the industry. However, this doesn’t have to be a flash in the pan.

    This current expansion of activity is not all down to financial incentives and the Government needs to find ways of sustaining this increase in sales beyond the New Year when the March deadline for the end of the stamp duty holiday will be staring buyers down.

    “There is already talk of some missing out because of severe delays to the conveyancing process tripping up even those who have had offers accepted and are trying to exchange now.”

    Blog Post from Evening Standard H&P

    See details of our Guaranteed Rent Scheme here

  • Londons First-Time Buyers Seeing A Jump

    Londons First-Time Buyers Seeing A Jump

    More than a third of London boroughs have seen a jump in sales to Londons first-time buyers since lockdown. Here’s where to focus your search.

    The proportion of sales to Londons first-time buyers is up in 13 of the 33 boroughs.

    Greenwich, Hounslow, Hammersmith & Fulham, Waltham Forest and Islington are the areas with the greatest upswing in sales to this young buyer tribe.

    Camden, Southwark, Wandsworth, Kingston and Lewisham complete the top 10.

    Here, Homes & Property tours the most central urban boroughs that, regardless of economic woes, Brexit and the pandemic, have not lost their appeal for Londons first-time buyers.

    Greenwich: Zone 2

    The number of sales to first-time buyers jumped by nearly a quarter in Greenwich. The area has a large number of new-build developments targeting young home buyers, which could account for the rise.

    “The Greenwich lifestyle attracts young professionals who work in the City and Canary Wharf, and currently feel secure in their jobs,” says Katie Clutterbrook of Foxtons.

    “Green space is a big tick for people at the moment and those buying in the new-build schemes have blue space on one side and the river walks and Greenwich Park on the other.”

    Her best selling scheme has been The River Gardens, with tennis courts, a gym, and gardens, by Bellway.

    The Docklands Light Railway is within walking distance. Prices start from £705,000, call 020 8131 0485 for details.

    Shared-ownership homes are a more affordable way on to the property ladder.

    Housing provider L&Q is selling one-bedroom homes at Greenwich Square for £96,250 for a 25 per cent share and £133,750 for 25 per cent of a two-bedroom apartment.

    Maze Hill station is a 12-minute walk away, reaching London Bridge in under 15 minutes. Call 020 8189 7583.

    Savills is selling homes at full market value at Courtyard within the same scheme. Prices start from £420,000. Call 020 7531 2516.

    Hammersmith & Fulham: Zone 2

    Parsons Green is still the most popular part of Fulham for “well-heeled” first-time buyers, says Dexters’ Charlie Ince-Green.

    A one-bedroom apartment in a period building will cost around £550,000 to £600,000.

    “We find our first-time buyers are very career-orientated, work long hours and are short on time — whether they are working from home or in the office. So being in a relatively central London village, like Parsons Green, with amenities on the doorstep, is important to them,” says Ince-Green.

    The market has changed dramatically since last year, he explains. “During Brexit uncertainty, viewers could have seen a property with us and bought tomorrow or in two years. They were nervous. This year they are going for it.”

    Sands End, a collection of converted warehouses and factories and Victorian work cottages near Chelsea Harbour, is another popular spot and has a micro community of first-time buyers.

    Dexters is selling a two-bedroom, ground-floor garden flat in Sands End for £625,000. Call 020 7386 5386.

    Islington: Zone 2

    In Islington the typical first-time buyer is looking for a one-or two-bedroom apartment in a converted Victorian house as near to the Upper Street buzz as possible, explains Nick Moore of Knight Frank.

    “Brexit uncertainty held first-time buyers back,” he says. “But since the property market reopened in May, we have seen a release of this pent-up demand.

    “It’s cheap to borrow and the stamp duty holiday has been a real incentive.” For those spending over £500,000 it equates to a £15,000 discount.

    “The Bank of Mum and Dad continues to be a really important part of the Islington market but the nature of the first-time buyer is changing, too. They are waiting longer to buy and are further on in their careers than they were 10 or 20 years ago,” he explains.

    This means some can afford to stay central. Typically, the first-time buyer is spending £500,000 on a one-bedroom apartment and new-build flats are being bought by investors and overseas parents with children planning to come to London to study, Moore adds.

    The home buying budget goes further at the Highbury end of Upper Street — and further still if you buy towards Stoke Newington and Finsbury Park.

    Moore is selling a one-bedroom flat in Peerless Street for £575,000 and one in Eden Grove for £400,000. Call Knight Frank on 020 3657 7342.

    Blog Post from Evening Standard H&P

    See details of our Guaranteed Rent Scheme here

  • Rise Of Suburbanisation Leads Housing Market

    Rise Of Suburbanisation Leads Housing Market

    The rise of suburbanisation and a worsening housing supply crisis mean the capital will lead the UK housing market in the post-pandemic recovery, with Londoners expected to see their house prices rise by a fifth (21 per cent) over the next five years, according to a new forecast, exclusive to Homes & Property.

    London is set to outperform the rest of the UK next year with house prices staying flat compared with a national fall (-1.5 per cent), the study by JLL reveals.

    The rise of suburbanisation is expected to do well as affluent families upsize to leafy neighbourhoods while first-time buyers head to the more affordable regeneration zones.

    JLL’s head of research, Nick Whitten, predicts prices will rise in the previously “less fancied” pockets, too, as buyers prioritise space to work from home over location.

    “We are seeing the rise of suburbanisation as buyers are prepared to sacrifice commuting convenience in search of more space, which will drive activity in some previously less fancied locations,” he says.

    Whitten believes buyers are adjusting where and how they live in London but dismisses the much-debated mass exodus.

    Ultra-rich buyers will trigger recovery

    The recovery will start in prime, central London areas as overseas investors return to the exclusive districts of Mayfair, Knightsbridge, Belgravia, Kensington and Chelsea.

    Central London is a different beast to the rest of the propertymarket, driven by high-net-worth people from around the world. The area performs well out of a downturn, bounces back quickly and is a safe haven for global wealth, Whitten explains.

    “Prices have slid this year in prime central London by 20 to 30 per cent making these multi-million pound trophy homes seem comparatively good value versus the equivalent districts in cities such as Paris, New York and Hong Kong ,” adds Becky Fatemi, property agent for the mega-rich.

    She is selling a five-bedroom house for £24,750,000 on Lennox Gardens, a private residents’ square garden in Knightsbridge.

    This type of home seems like another world but there is a link between Belgravia and Barking. When the central London property market is booming, wealth generation and job creation ripple out to the rest of London.

    “The residents of such homes spend money on retail, leisure, culture, transport and food, benefiting the wider economy,” Fatemi explains. Price rises ripple out, too.

    Housing shortage will push up prices

    A growing housing shortage will also push up prices as demand outstrips supply. Housebuilders in London have fallen behind during the coronavirus crisis.

    “We expected to see 20,000 new homes built this year against a target of 52,000. In reality this number has dropped to 10,000 for 2020 due to the industry shut-down and the ongoing need to socially distance on site,” says Whitten.

    The failure of global supply chains at the height of the first wave of the virus led to a run on materials such as plaster — dubbed “the pink powder crisis” in the industry.

    Stamp duty holiday cliff edge

    The JLL paper takes into account the end of the Chancellor’s stamp duty holiday, which was announced in his July emergency summer budget.

    This tax break created a micro-boom in London with buyers saving £15,000 on stamp duty above £500,000, but is due to end on March 31 next year.

    Property agent Alex Goldstein says Rishi Sunak should have kept his powder dry. “The pent-up demand and need for space in the lockdown was always going drive a rise of suburbanisation in the housing market. He should have saved the stamp duty for when sales start to taper off, which is beginning to happen now,” he says.

    Fears are growing among agents that the sudden closure of the stamp duty window could cause a sharp drop in transaction levels, which typically triggers price falls.

    “The combination of the stamp duty holiday with Help to Buy is like giving a child too much sugar. If the Chancellor ends the stamp duty holiday abruptly, activity could crash,” says Fatemi.

    Shared ownership boom

    Whitten also expects shared ownership to grow in popularity over the next few years due to widespread financial difficulties. The affordable scheme allows you to part-own and part-rent a property.

    Antonio Miragliotta, an executive at Not On The High Street, was renting in Twickenham but decided to buy when his landlady had to shield.

    Miragliotta, 33, bought in the Staging Post scheme in Hounslow after he realised a shared ownership home was cheaper than renting in Richmond.

    He purchased a 25 per cent share of a one-bedroom apartment for £80,625 in the scheme, which has communal gardens. Contact Notting Hill Genesis on 020 3944 686.

    Four regeneration zones to buy in now

    Whitten pinpoints London’s half-built regeneration zones as the savvy buy over the next year.

    “These areas are well-suited to the first-time buyer who wants to see an uplift in the value of their home fairly quickly. They want to stay urban yet, following the lockdown, are looking for proximity to outdoor space, room to work from home and a balcony,” he says.

    Other priorities for young buyers include electric car charging points and bicycle storage.

    Stratford

    First-time buyers are more likely to want to stay as close to the centre of London as possible, regardless of the Covid-19 crisis, according to JLL.

    Thirty-year-old Dominique McRae has bought a 30 per cent share of a two-bedroom apartment in New Garden Quarter in Stratford. She was renting in East Village – the old Athletes’ Village – but a sudden inheritance helped her to buy in zone three.

    “I play tennis at the Lee Valley Hockey and Tennis Centre and my local swimming pool is the Olympic pool,” she says.

    Homes at New Garden Quarter start at £105,000 for a 25 per cent stake of a one-bedroom apartment. Call 020 3815 1234.

    Upton Park

    Upton Gardens, formerly West Ham’s home ground, has been converted into 181 new homes with an on-site gym, landscaped gardens that include an art trail, roof terraces, 64 e-charging spaces and room for 1,000 bikes.

    Prices start at £365,000, call 0330 057 6666.

    Royal Docks

    An £8bn new second city centre is being carved out of the Royal Docks, once the working heartland of the capital but abandoned after the decline of industry.

    Pontoon Reach is a new scheme launching this weekend in the 121-acre regeneration zone.

    The 13-storey tower will overlook gardens and cycle paths, with prices for a studio starting at £330,000. Call Redrow on 020 3733 0937.

    Crystal Palace

    Crystal Palace in south London has a well-established central community that is made up of traditional terraced housing but it is also undergoing an area upgrade starting with the beatification of Crystal Palace Park.

    Homes are available to buy in the 14-unit Palazzo building – a Victorian conversion.

    The building has private parking, bike storage, a communal garden and is a short walk from Crystal Palace overground station.

    Blog Post from Evening Standard H&P

    See details of our Guaranteed Rent Scheme here

  • Government’s £3 Billion Affordable Housing Guarantee Scheme to be Operated by Ara Venn

    Government’s £3 Billion Affordable Housing Guarantee Scheme to be Operated by Ara Venn

    Investment management firm ARA Venn to deliver £3 billion scheme that will provide cost-effective long-term loans to registered providers of affordable homes.

    Housing Minister Rt Hon Christopher Pincher MP announced on 16th October 2020 that ARA Venn will manage the government’s new £3 billion Affordable Homes Guarantee Scheme (AHGS 2020).

    Contracts were signed for investment management firm ARA Venn to deliver the £3 billion scheme that will provide cost-effective long-term loans to registered providers of affordable homes.

    The new Affordable Homes Guarantee Scheme will help to finance affordable homes across England, including for social rent, affordable rent and shared ownership.

    The funding will provide low-cost, flexible loans that will support Registered Providers to deliver their development plans and deliver new affordable homes. The scheme will be complementary to the new Affordable Homes Programme.

    The Government have also published the scheme rules, helping Registered Providers to plan ahead and prepare their applications for the support.

    The scheme will be formally opened for applications in the coming weeks, with the first loans to be delivered next year. The Government will publish these details in due course.

    Housing Minister Rt Hon Christopher Pincher MP said:

    “Ensuring everyone has the opportunity to access a secure, affordable home is central to the mission of this government and our £3 billion Affordable Homes Guarantee scheme will play a vital part in achieving this.”

    “ARA Venn’s wealth of investment expertise will prove invaluable to delivering another 17,000 much-needed new affordable homes to families across the country.”

    Richard Green, Partner, Portfolio Manager of AHGS20 at ARA Venn said:

    “We are delighted to have been appointed as the manager of the new Affordable Housing Guarantee Scheme. The scheme will offer registered providers very attractively priced long-term loans to support the vital housing that they provide.”

    “We look forward to establishing the scheme as a key partner to support the vision and ambition of the social housing industry. The ARA Group has a strong commitment to Environmental, Social, Governance (ESG), firmly believing in long term responsible investment and delivering a positive social impact from this scheme is a reflection of that.”

    The announcement follows the launch last month of the new £11.5 billion Affordable Homes Programme, which will be delivered over 5 years from 2021 to 2026, providing up to 180,000 new homes across the country, should economic conditions allow.

    More than 1.5 million new homes have been delivered since 2010, including more than 460,000 affordable homes. More than 644,000 households have been helped to purchase a home since spring 2010 through government schemes including Shared Ownership, Help to Buy Equity Loans, Help to Buy ISAs and Right to Buy.

    Blog Post from Property Notify

    See details of our Guaranteed Rent Scheme here

  • The Future of Buy-to-Let – Is it Worth it?

    The Future of Buy-to-Let – Is it Worth it?

    The stamp duty land tax (SDLT) holiday is fast becoming the most impactful property policy introduced by any UK government since the implementation of Right to Buy in 1980.

    While other asset classes are experiencing unprecedented volatility due to COVD-19, the SDLT holiday has imbued the housing market with such activity that – according to the Royal Institute of Charted Surveyors – house prices are growing at record levels.

    However, even though the holiday exempts all property transactions below £500,000 from the tax, including second home purchases, it’s possible that the drawbacks of buy-to-let (BTL) investment still outweigh the potential benefits.

    Ask any landlord and you’ll quickly find out about the ever-shifting rules and regulations private landlords have been forced to contend with in recent years.

    Successive British governments have, in an attempt to reform the private rental sector, introduced various changes to the BLT market, many of which landlords feel disproportionally target them.

    These changes, varying from amendments to Section 21 to reforms to the mortgage interest rate relief, are making the private rental market incredibly difficult to navigate. And as I have discussed previously, this could bring about a mass landlord exodus.

    The complex nature of BTL investments

    An independent survey of over 750 landlords, commissioned by Accumulate Capital in February revealed that 72% of property investors thought current BTL regulation made life unduly difficult for landlords.

    A surprisingly high number, 37%, said they planned on selling their property in 2020. Of those, a majority (61%) stated that increased landlord regulations and taxes were the prime reasons behind their decision to leave the BTL market.

    Of course, regulation is undoubtedly useful in protecting the interests of those involved in property. But regulations need to be carefully thought out with the interests of all parties involved in order for them to have the most success.

    Accumulate Capital’s survey findings clearly revealed at the time that implementing regulation without a wider unified objective in mind simply burdens landlords with excessive red tape and makes renting out one’s property an unnecessarily complicated undertaking.

    The SDLT holiday may have made becoming a landlord comparatively cheaper, but it does not undo the years of increased stifling regulation property investors have been facing; nor the more subtle ill-effects of COVID-19 on the private rental market.

    The impact of COVID-19 on landlords

    The initial impact of COVID-19 on the rental market continues to be immense. Travel restrictions and the working-from-home revolution has meant that since June, the number of new lets every month has been 25% lower than in the corresponding months in 2019.

    That’s according to LonRes. Additionally, the end of the furlough scheme this month will potentially place thousands of jobs at risk, leading landlords to fear their tenants falling into arrears en-masse.

    As a consequence, landlord sentiment is cynical at present. New research from the National Residential Landlords Association (NRLA) demonstrates how two thirds (66%) of private landlords expect to be negatively impacted by the COVID-19 pandemic; despite government initiatives to support the industry.

    So, amidst oppressive regulation and cynical landlord sentiment – is COVID-19 the final nail in the coffin for BTL investment?

    Beginning of the end?

    As mentioned above, the SDLT holiday has undeniably made the process of becoming a landlord marginally cheaper due to buyer’s exemption from stamp duty.

    However, it does not alleviate landlords from COVID-19’s effect on rental demand, nor the increased difficulty landlords face from policies specifically targeting landlord practices.

    This may have wide-ranging consequences for the rental market; the largest of which potentially being property investors shunning BTL investments entirely in favour of alternate types of property investment.

    After all, with the rate of house price growth growing steady, demand for property remaining strong, and the current low interest rate environment, there are still clear incentives for those interested in property investment. Just because the traditional BTL landlord route is now less desirable does not mean all types of property investment are off the table.

    The aforementioned Accumulate Capital survey demonstrated that over a fifth (21%) of landlords are considering new property investment avenues, such as debt investment and development finance, in 2020.

    If no government action is taken to support BTL investors throughout the remainder of this pandemic, then it’s likely that we will see such alternative property investment avenues increase in popularity in the future.

    I have every confidence that real estate will remain a leading investment here in the UK. What will change, however, is the way people access property as an asset class.

    BTL was the traditional route, but this is no longer proving to be the case. As such, I expect a rise in alternative investment avenues such as property development finance.

    Paul Howells is CEO of Accumulate Capital – an investment and property development finance firm. Accumulate Capital connects registered investors with developers in the property development finance sector to enable selected, high-yielding projects in the UK and overseas

    Blog Post from Property Notify

    See details of our Guaranteed Rent Scheme here

  • Residential Property Transactions Up by 21.3% in September

    Residential Property Transactions Up by 21.3% in September

    House sales rose by 21.3% in September following the introduction of the stamp duty holiday – helping to protect hundreds of thousands of jobs in the housing sector and wider supply chain, new figures reveal.

    • residential property transactions rose 21.3% in September following introduction of stamp duty holiday
    • rise in sales supports hundreds of thousands of jobs in the sector – with new homeowners also spending extra cash on decorating, furniture and appliances
    • 33% of homebuyers plan to spend their savings from the tax break on home improvement and renovations, boosting business and jobs

    After a 15.6% rise in August, residential property transactions in September rose a further 21.3% as more people decided to buy a new home or move house. The increase in transactions came after the Chancellor announced a stamp duty holiday at the start of July that will last until March next year.

    The move has helped to protect hundreds of thousands of jobs, benefitting businesses across the housing supply chain and beyond, with the Bank of England estimating that households who move home are much more likely to purchase a range of durable goods, such as furniture, carpets or major appliances.

    It is expected that among others housebuilders, estate agents, tradespeople, DIY stores, removal and cleaning firms could all benefit from the increased activity.

    Chancellor Rishi Sunak said:

    “With a third of Brits planning to spend savings from the tax break on home improvements and renovations, the temporary stamp duty cut is boosting business and protecting jobs.”

    “This ranges from carpenters to cleaners, brickies and decorators, they can all benefit from each sale – helping us to further deliver on our Plan for Jobs.”

    As part of its Plan for Jobs, the government introduced a temporary stamp duty holiday for residential properties worth up to £500,000 effective from 8 July 2020 until 31 March 2021.

    The holiday means nine out of ten people getting on or moving up the property ladder will pay no SDLT at all. This measure delivers an average saving of £4,500 in SDLT.

    The government wants people to feel confident to move, to buy, to sell, to renovate, and to improve their homes, driving growth and supporting jobs.

    This comes on top of figures from the Building Societies Association which show that there has been a marked uplift in the number of people who say that now is a good time to buy a property this quarter – 37% in September compared to 25% in June.

    Blog Post from Property Notify

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  • Landlords, ignore planning laws at your peril…

    Landlords, ignore planning laws at your peril…

    Some landlords it would seem think they can treat planning laws with expectations of impunity, but sooner or later the law catches up with them and the results are painful!

    Waltham Forest Council has brought two successful prosecutions against landlords over their flouting of planning laws.

    Landlords Mr and Mrs Khilji and company director Mohammed Raja Iqbal have been prosecuted by the council and heavily fined for making changes to their properties without proper planning applications and consent, and refusing to re-instate when they were caught out.

    Mr and Mrs Khilji of Sylvester Road, Walthamstow refused to revert a property they converted into flats back to its original configuration, despite warnings, and were eventually brought to court over the matter.

    The Khiljis were found guilty of illegally converting a property on Rochdale Road, Leyton into two self-contained flats. Plus they failed to comply with an enforcement notice which required them to return the property to its original structure.

    They pleaded guilty at the Thames Magistrates Court, following which the case was referred to Snaresbrook Crown Court for sentencing. Whereupon a combined sum of £421,837.89 was awarded for fines and prosecution costs in two cases under the Proceeds of Crime Act, the sum representing the profit from the committed crimes.

    In a separate case, the Council Planning Enforcement Team investigated Iqbal, a landlord and a director of Premier Home Investments Ltd, a property company based on Hoe Street, Walthamstow.

    Iqbal failed to comply with a planning enforcement notice relating to 65 St James’s Street, Walthamstow, where he had built, without planning permission, a three-story extension, and had converted the upper floor of the house into separate flats.

    Iqbal was prosecuted at Snaresbrook Crown Court after failing to demolish the extension and reinstate the original two-story structure following the issue of an enforcement order.

    He was ordered to pay confiscation proceeds in the sum of £261,837.89 or face two years’ imprisonment in default of payment. Costs were also awarded in the amount of £27,174 and a fine of £20,000 was handed down.

    Cllr Clyde Loakes, Deputy Leader and Cabinet Member for the Environment at Waltham Forest Council, commented:

    “People who flout planning rules for their own financial gain need to understand that we will take necessary enforcement action.

    “We will consider action under Proceeds of Crime Act whenever appropriate so that we take away the financial benefit of this criminal activity.”

    Blog Post from Landlord Zone

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  • Landlord duo fined £110,500 for running three dangerous and overcrowded HMOs

    Landlord duo fined £110,500 for running three dangerous and overcrowded HMOs

    A duo in London have been given the highest Landlord fine to date this year following an investigation by Islington council into three HMO properties.

    Midlands-based landlord Arun Bajaj, 60, has been fined £100,000 with £20,000 costs while co-defendant Antonio Ferraiuolo has been £10,500 following a trial in August.

    Bajaj was found guilty of 15 offences at two properties on Seven Sisters Road and a third on Grosvenor Avenue (pictured), all of which his family owned.

    Ferraiuolo, 57, from North London was found guilty of 35 offences after he was found to have sub-let the Grosvenor Avenue property off Bajaj and filled it with 35 tenants. He also managed the two other properties for Bajaj.

    All the offences were breaches of the Management of Houses in Multiple Occupation Regulations after tenants were found to be at risk from serious fire safety hazards, overcrowding and disrepair.

    Overcrowding

    At the converted Victorian house on Grosvenor Avenue, council officers found dozens of people living in three two-bedroom flats, with up to five or six people having to sleep in the same rooms.

    The building was found to have no working fire alarm system, new room partitions that were not fire resistant, and fire risks including dangerous electrics.

    Occupants of the property did not have tenancy agreements, and paid rent in cash.

    The council became aware of the property after neighbours complained about anti-social behaviour, and officers later discovered the link to the two other HMOs.

    During sentencing, Judge Clark QC said Bajaj had turned a blind eye to the situation at all three properties, but that Ferraiuolo had been ‘calculatedly criminal’.

    Blog Post from Landlord Zone

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