Key takeaways from the latest UK property news are that both house prices and rental yields continue to grow above pre-pandemic levels.
In other news, landlords complain about the cost of meeting damage caused by pets owned by their tenants and the lack of financial support for energy efficiency improvements.
Let’s take a closer look.
How much has your home risen in value since the pandemic began?
Since the coronavirus struck in February 2020, the average UK home has increased in value at the rate of £48 a day, according to figures published by online listings website Zoopla on the 20th of July
Those increases have been driven by unprecedented levels of demand. That demand was generated during successive and extended periods when many households were working from home and people wanted a move to a bigger house or one that was closer to the coast or the countryside.
The upsurge in demand inevitably led to an increase in prices.
Even so, there are marked regional differences in the housing market. Whereas average prices may have risen by as much as £106 a day in some areas, in others values have fallen by £40 a day.
Rental yields are holding their own led by key investment hotspots
The overall strength of the housing market is also reflected in rental yields in the private rented sector, according to a report by the Buy Association on the 22nd of July.
Steady and strong seem to be the key descriptions of performance in this sector of the housing market, where buy to let landlords are assured of a “very interesting period” according to commentators.
Current statistics suggest that average rental yields across the whole of the UK rest at around 5.5% during the second quarter of this year. That is a little lower than the 6.1% average that was achieved in the same period last year and marginally less than the 5.7% average recorded in the first quarter of this year.
Survey: More than half of landlords and agents unable to recoup pet damage costs
The results of a recent survey published by the National Residential Landlords Association (NRLA) earlier this month suggest that many landlords and letting agents have found it impossible to recover the costs for repairing damage caused by tenants’ pets.
One surprising statistic is that 85% of all landlords surveyed said that they had suffered some degree of pet damage in the let properties they owned – surprising because by no means all landlords currently allow tenants to keep pets.
In the current “pets in lets” debate, the NRLA is campaigning for fairer means of compensation for those landlords who have to repair their property after damage caused by tenants’ pets. To ensure that all landlords have access to sufficient funding for the necessary repairs, the NRLA is calling either for an insurance scheme against pet damage or for the creation of special deposits from tenants to cover the potential costs of carrying out repairs.
Energy efficiency: landlords need subsidies to make changes – claim
Everyone’s a winner from the installation of energy efficiency measures, argued an article in Landlord Today on the 22nd of July – so government subsidies should be used to encourage landlords to make those improvements.
The report identified three principal benefits of introducing green technology and energy efficiency measures:
- a saving on fuel bills of up to £1,878 a year;
- a 95% reduction in harmful CO2 emissions over the lifetime of energy efficiency installations; and
- an average increase of £10,000 in the value of any residential property.
In the light of such gains, the article echoed calls for policy direction and support from the government and financial help – through tax incentives – in reducing the installation and running costs of green technologies and energy efficiencies
Britain’s leading mortgage lenders confirm they will lend on flats affected by cladding issues
A group of leading mortgage lenders has confirmed that its members will consider granting mortgages for the purchase of flats where either the government or private developers have already agreed to pay for the necessary repairs to hazardous cladding.
In a story welcoming the move, the Daily Mail on the 19th of July reminded its readers that, in the wake of the Grenfell Tower tragedy in 2017, hundreds of thousands of flats in similar high-rise buildings were discovered to have equally dangerous cladding.
The presence of such cladding on high-rise blocks created such serious risks of fire that the flats became unsaleable – and, therefore, unmortgageable. Some comfort will have been gained by the owners of these properties, therefore, to know that lenders are prepared to grant mortgages provided the necessary repairs have been agreed upon and paid for either from public funds or by the developers themselves.
