Landlords, homeowners, and property investors are all likely to feel at least some impact from items making the headlines in recent property news stories.
Let’s take consider a little more detail about just some of those themes.
Do all energy efficiency measures save money after five years?
Landlords may be doubting whether the energy efficiency measures they have installed in their let premises will end up saving money after all, according to a story by Landlord Today on the 11th of October.
Although improved energy efficiency is part and parcel of sustainability objectives, research shows that, for an average mid-terrace property, most such improvements fail to recover their capital cost even after five years.
Some of the costliest energy efficiency measures include:
- solar panels – on which you will spend an average of £4,800 but save only £1,650 after five years;
- double-glazing – expenditure of £4,250 but savings of only £850; and
- boiler upgrade – expenditure of £2,500 to save around £850.
On the other hand, the following measures appear to be highly cost-efficient:
- simple draught-proofing – spend £3 to save £215;
- roof insulation – spend £285 to save £500; and
- wall insulation – spend £400 to save £500.
Internet connectivity should be top consideration for property investors
Savvy property investors should give priority to locations where internet connectivity is strong and avoid investing in properties located in areas where that connectivity is weak.
Emphasising the importance of broadband connectivity hotspots, an article by the Buy Association recently explained that the series of lockdowns during the pandemic and the resultant upsurge in working from home has lent an added premium to homes with excellent connection.
Reliable, daily connection to the internet is no longer just something that tenants and leaseholders will find “nice to have” but is now an essential utility.
Not so grim up North as yields beat the rest of the UK
Once upon a time buy to let landlords might have considered the North of Britain to be a poor choice for investment. Recent research, cited by Landlord Today on the 14th of October, suggests that the tables have turned quite noticeably. The highest rental yields for landlords are these days to be found in the Northwest of England and Scotland.
With average yields across the whole of Britain currently achieving some 4.2%, the Northwest has recorded average yields of 5.4% and Scotland of 5.1%.
Other regions such as Yorkshire and the Humber, the Northeast, Wales, and the West Midlands have also reported average yields higher than the national average – in the range of 4.8% to 4.3%.
Yields in London are close to the national average while in practically the whole of the remainder of the country – the Southeast, Southwest, and East of England – rental yields have fallen below the national average of 4.2%.
Annual house price growth slowed last month
Ever since the easing of lockdown, house prices across the UK have shown an unrelenting and steady increase. That trend may now be slowing, according to the house prices index maintained by the Nationwide building society.
The annual growth in house prices had fallen back to 10% in September, compared with the annual growth of 11% recorded to the end of August – although there was, in fact, little change in the monthly movement of house prices once seasonal factors have been taken into account, says the building society.
Wales and Northern Ireland showed the strongest evidence of increases in average house prices during this third quarter of the year while London performed the weakest.
While house prices have continued a more or less steady rise, average incomes have lagged behind – so making housing affordability a greater challenge. The deposit required by a first-time buyer, for instance, is now around 20% of the current purchase price. That makes the deposit alone equivalent to around 113% of the buyer’s annual income – an all-time high.