Current UK property news focuses on both home ownership and conditions in the private rental sector.
Catching the eye of homeowners will be a story identifying the country’s hottest of property hotspots and an overview of movements in average house prices nationwide.
The private rental sector continues to be marked by a noticeable shortage in the supply of available accommodation – a shortage likely to be made much worse if there is no raising of the mortgage tax relief allowance.
Most valuable areas of the UK property market where conditions remain ‘very hot indeed’
A story in the Express newspaper recently identified a few surprises when it revealed the hottest of the UK’s current property hotspots.
The local property market topping that list was the Scottish capital Edinburgh, where the average price of a home is currently £326,024. A total of 11,295 sales were completed during the past year – at an estimated combined value of £3.7 billion.
Second in the overview’s ranking was Buckinghamshire where there were some 7,115 sales of homes – at a cumulative value of £3.4 billion.
In third place was the London Borough of Wandsworth where home sales reached a total of £3 billion – made up of the borough’s 4,552 transactions.
Some surprises in the top ten hotspots included North Yorkshire (at number four), Belfast (in eighth place), and Birmingham (in ninth).
Nationwide: House price growth shows signs of stabilisation in April
It fell to the Nationwide building society in its regular house price index to summarise the current state of the housing market.
The picture presented is one of a fairly stable market.
After seven consecutive months during which the average house price continued to fall, April saw a modest 0.5% increase in those prices. It also meant some improvement in the annual movement of house prices – from a previous -3.1% to its current -2.7%.
Supply shortage remains the key obstacle for the rental market
An article in Landlord Today on the 30th of May considered the widening gap between supply and demand in the private rented sector.
The demand – measured by the number of prospective tenants registering their interest with lettings agents – is clearly increasing. Not only are the numbers higher than in the traditionally quiet month of December, but the volume of prospective tenants is also now an estimated 24% higher than at this time last year.
Turning to the supply side of the equation, however, the article noted that despite the surge in demand only the same number of vacancies for tenants existed now as they did last year. The imbalance between supply and demand has risen by some 35%, said Landlord Today.
Although a marked shortage in supply would normally herald increasing rent levels, the article noted that only 50% of letting agents reported month by month rent increases – compared with 75% of those agents who responded to the same question last year.
Reversing the abolition of mortgage tax relief would ease supply crisis in the rental sector
The National Residential Landlords Association (NRLA) claims to have discovered a way of helping to stabilise just such an imbalance between supply and demand in the private rented sector.
In a press release on the 26th of May, the (NRLA) argued for a reintroduction of mortgage interest tax relief for landlords claiming that this would help to alleviate the crisis of supply of let accommodation.
The NRLA argued that something needs to be done to persuade landlords to remain in the buy to let business. It referred to predictions that if the Bank of England’s base rate peaked at 5% and remained above 2.5% for the next four and a half years – as widely reckoned – a further 735,000 let properties would be sold by landlords quitting the market. Compared with 2021, a further 13% of the property available for rent would be lost.
