Landlords and homeowners are once again making the property headlines.
Landlords face an evolving regulatory landscape and a tougher approach to compliance, while the price gap between houses and flats has reached its widest level in 30 years, potentially putting flats back on the radar for buyers looking for a more affordable route onto or up the property ladder.
There are also concerns about the number of UK properties that may fall outside standard high-street mortgage lending criteria.
Here, we take a closer look at some of the latest property news.
Councils get tougher on landlord compliance
Local authorities are taking a tougher approach to enforcing regulations in the private rented sector according to Landlord Today.
The Renters’ Rights Act has strengthened the regulatory framework for England’s private rented sector, with local authorities having duties and powers to take enforcement action where landlords or agents breach relevant requirements.
Landlords therefore need to keep on top of both their existing legal responsibilities and requirements introduced or amended by the Renters’ Rights Act.
Areas to pay particular attention to include:
- property standards and the management of hazards;
- Electrical Installation Condition Reports (EICRs) and electrical safety;
- compliance with gas safety requirements;
- Energy Performance Certificates (EPCs);
- tenants’ deposit protection;
- relevant property licensing requirements;
- communications with tenants and the handling of complaints; and
- appropriate record keeping and documentation.
With councils able to take enforcement action in appropriate circumstances, landlords should ensure they understand the rules that apply to their properties and keep appropriate records demonstrating compliance.
Flats now 40% cheaper than houses
The price gap between flats and houses has reached its widest level in 30 years, according to research from property website Zoopla.
Across the UK, says the study, flats are around 40% cheaper to buy than houses. The average flat costs approximately £193,000, compared with £327,000 for the average house.
The difference reflects a significant divergence in price growth over the past decade. Since 2016, the average price of a UK flat has increased by a little over 10%, while the average house price has risen by 43%.
There are also substantial regional differences. In the West Midlands, for example, the gap between average flat and house prices is particularly pronounced.
For buyers focused primarily on purchase price, flats can therefore represent a significantly lower-cost option than houses. However, prospective buyers should also consider factors such as lease length, service charges, ground rent and the individual property’s mortgageability before making a decision.
Why some homes can be difficult to mortgage
More than 5% of UK homes may fall outside standard high-street mortgage lending criteria, according to research reported by Estate Agent Today.
That potentially represents more than 1.5 million properties.
Factors that can make securing a mortgage more difficult include:
- non-standard construction;
- an uninhabitable condition, such as a property being unsafe or lacking a working bathroom or kitchen;
- building safety issues, including certain cladding concerns on high-rise flats;
- location and environmental factors; and
- legal issues, such as missing planning permission, short leases or restrictive covenants.
Research cited by Estate Agent Today also suggested that around one in five prospective buyers had abandoned plans to purchase a property because of mortgageability-related issues.
It is important to remember that lending criteria vary. A property that does not meet one lender’s requirements is not necessarily impossible to mortgage, although buyers may have fewer options or need to approach a lender that considers more unusual properties or circumstances.
Please note: This article is for general information only and does not constitute financial, mortgage or legal advice. Property values, mortgage availability and lending criteria vary, and you should seek appropriate professional advice where necessary.
