UK property news features a cross-section of hot topics, with headlines revealing a shortage of homes for rent in the capital, the investment potential for landlords upgrading the EPCs of their dwellings, property prices hitting a new record, and the unexpected property hotspot that is Kirkby.
Let’s take a look behind those headlines.
London Needs Almost 85,000 New Private Rented Homes A Year Warns Report
London faces a shortfall of nearly 85,000 homes in the private rental sector preventing the capital from meeting its housing needs, according to the National Residential Landlords Association (NRLA) last week.
That figure was reached with reference to the government’s target of an additional 340,000 homes built across the UK by the year 2025. Allowing for a continuation of the current 10-year average rate of building new owner-occupied and social housing units, the government’s target for additional housing would need to include an extra 227,000 homes in the private rented sector.
To meet the specific needs of London’s growing population, roughly 83,000 new homes in the private rental sector will be required within the next ten years – this at a time when the availability of private rental homes in London has already fallen by 85,000 in the past five years.
Landlords Switch On To Investment Potential Of Upgrading EPCs
There has been a noticeable trend of landlords buying up dilapidated properties with the aim of upgrading to a higher energy performance rating and reaping the benefits of the properties’ capital appreciation.
In an article published by Landlord Today on the 4th of March, it was revealed that the majority of landlords – especially those with a portfolio of buy to let properties – are aware of the need for an Energy Performance Certificate (EPC) of at least a C.
But a recent survey has shown that an even bigger proportion of landlords – 68% – own properties rated only D or below, with 80% of that number having declared an intention to upgrade the property to at least a C rating. The government is currently on the brink of introducing legislation requiring any newly let property to achieve a minimum C rating by 2025 and for existing tenancies to achieve that rating by the year 2028.
Zoopla Hails Record Average Property Price
In just the opening months of 2022, property prices in the UK have hit new records.
The price of the average home is now £278,123 – according to Forbes magazine on the 7th of March, an increase of 10.8% in the 12 months to the end of February. Prices rose by 0.5% in February alone – making that the eighth consecutive increase in as many months and the strongest annual rate of growth for 15 years.
Rising Interest Rates Worry Renters And Homeowners
Research commissioned by bridging lenders Market Financial Solutions (MFS) has revealed how the prospect of rising interest rates is worrying homeowners, prospective homebuyers, and renters hoping to get that important first step on the housing ladder.
Among existing homeowners, 19% say that further increases in the lending rate will significantly impact their ability to maintain their mortgage repayments; 66% of prospective homebuyers are worried that any such increase will ruin their chances of buying; while 28% of renters believe that any chance of getting a foot on the housing ladder will be thwarted by an increase in interest rates.
The Bank of England base lending rate was increased from 0.1% to 0.25% in December, while a further increase to 0.5% was made in February
The research by MFS suggests that 18% of households in the UK plan to buy a property in 2022. Of all those tenants in the private rented sector, 14% plan to buy their first home. Among existing owner-occupiers, 14% are planning to sell and move home during 2022 and a further 6% intend to buy an additional property by way of an investment.
But two-thirds of prospective buyers are worried that inflation, high house prices, and increased interest rates may scupper their chances of buying. A further 38% of prospective buyers also believed that the time taken, and the complexities involved in securing a mortgage will prove major challenges to their hopes for buying a property.
Why ‘Hidden Gem’ Kirkby Has Become One Of The Country’s Property Hotspots
Who would have thought that the town of Kirkby in the northwest of England was one of the country’s property hotspots? Yet, according to the Liverpool Echo on the 6th of March, that is exactly what the place has become.
Its new-found status as a property hotspot began to emerge in January when online searches featuring the town more than doubled compared with the same month in 2021.
This happened at a time when average asking prices for a home in Kirkby had risen by almost 12% in the preceding 12 months – bringing the average price to £127,787 in January of this year.