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HMO licensing in York, EPC upgrades slammed, house prices steady, mortgage rates fall and other UK property news

HMO licensing in York, EPC upgrades slammed, house prices steady, mortgage rates fall and other UK property news
24 February 2023

By UKinsuranceNET In News

The latest UK property news headlines focus on market trends for landlords, tenants, and owner-occupiers.

HMO licensing is extended in eight wards of York and more buy to let (BTL) investors are selling up. Plus, property developers have slammed government policies on upgrading Energy Performance Certificate (EPC) standards. But house prices remain steady and mortgage rates are falling.

Let’s take a quick look behind those headlines.

Small HMOs in York to be subject to council licensing from April

In eight wards across the City of York, landlords of small Houses in Multiple Occupation (HMOs) will require a licence to operate the accommodation, according to an announcement by the local council.

Large HMOs are already subject to mandatory licensing. The latest decision extends so-called additional licensing to small HMOs. These are occupied by three or four people who comprise more than one household, explained Landlord Today on the 21st of February.

The eight wards where licences will be required for small HMOs are those with the highest densities of that type of dwelling in the city.

Over a third of property auction lots are BTL investors ‘fleeing the market’

The exodus of landlords from the buy to let (BTL) market continues says a news story in Mortgage Strategy on the 17th of February.

The article reveals that landlords have become so keen to quit the market as quickly as possible that they are selling up through property auctions. A third of all auction sales are currently former buy to let properties, revealed one specialist auctioneer.

The report goes on to explain that rental yields have reached their lowest in 14 years. The reasons for plunging returns include the currently high interest rates and rising cost of living.

As buy to let mortgage rates have climbed, so the operating costs of landlords have risen and investors have struggled to make the necessary returns on their property.

House prices remain steady as more homebuyers look to move

The housing market is entering what is traditionally its busiest time of year, said online listings website Rightmove on the 20th of February.

As sellers enter the market, they will find that prices have flattened of late. They are more or less stable at the current average asking price across the UK of £362,452, which is the smallest price increase between January and February ever recorded by Rightmove.

Homes for sale are still in relatively short supply. But supply is 48% higher than 12 months ago.

In a return to normal housing market trends, enquiries to estate agents from potential buyers are on the increase – 11% higher than at the same time of year before the pandemic.

Buoyancy in the market is also helped by falling mortgage interest rates. A 5-year fixed-rate deal for a borrower with a 15% deposit will now attract an average rate of 4.82% – compared with 5.9% just three or four months ago.

Mortgage rates are falling and choice is increasing

Similar findings were echoed by another online listings website Zoopla on the 20th of February.

Its figures also show that average mortgage rates are dropping. With that fall, there is also a wider choice for borrowers. Currently, there are 4,341 mortgage products available compared with 3,643 the previous month. The milestone of more than 4,000 mortgage deals was last passed in August 2022.

Zoopla’s figures suggest that a 2-year fixed-rate mortgage now attracts an average interest rate of 5.44% – compared with 5.79% the previous month and 5-year fixed-rate deals at 5.2% compared with a previous 5.63%. These rates are similar to those prevailing in the market last October – despite increases in the Bank of England base rate of 1.75% during the same interval.

Zoopla attributes the stability in the market to the more cautious policies of the current Chancellor compared with the panic caused by Kwasi Kwarteng’s mini-budget in September.

Property giants slam Government’s lack of action on EPC upgrades

Property developers JJL – in concert with the British Property Federation – has slammed government efforts to improve residential energy efficiency standards, according to a story in Landlord Zone on the 20th of February.

They complain that the lack of accurate and reliable data makes it virtually impossible to gauge progress toward the proclaimed net-zero ambitions of the government.

The EPCs for many residential buildings are “hopelessly inadequate”. Uncertainties surrounding government policy, a lack of meaningful regulation, and the absence of any financial incentives make it practically impossible to retrofit buildings in a more energy-efficient manner.

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