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Estate Agents & Letting Agents in Leeds

Here you will find the latest Hudson Moody Wass and property news.

Planning review proposals ‘offers a distinct overall lack of detail’

Taking into account the wide range of views expressed to the proposals set out in the ‘places, people and planning’ consultation, the Scottish government published a ‘position statement’ at the end of June which sets out changes they are considering taking forward as part of its reform of the country’s planning system.

But the planning review proposals put forward offer a distinct lack of detail, according to housebuilders.

Responding on behalf of its 200 members, Homes for Scotland (HFS) has submitted its response to the position statement stating the builders are concerned that the proposed package of reform measures will be a missed opportunity to make the strategic and radical changes to the delivery model that are required to achieve the review’s original objective of increasing the number of homes across Scotland.

Chief executive at the HFS, Nicola Barclay, said: “Given the crucial role the planning system plays in Scotland’s social wellbeing and economic success, the position statement offers a distinct overall lack of detail, particularly in relation to the process for the new Local Development Plan gatecheck and the introduction of an infrastructure levy to address what is becoming the most significant challenge to housing delivery.

“With matters now moving to a Bill at the end of the year, it is our view that a great deal more information is required before the package of legislative and non-legislative reforms can be effectively scrutinised. To that end, HFS and its members remain ready to positively engage and assist in developing a clear, robust and effective set of the proposals that meet the housing needs of our growing population.”


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Families and professionals ‘most likely to experience rent rises’

Rents are likely to rise in the third quarter of year as fewer rental homes come on to the market because more landlords are beginning to sell their properties as a consequence of recent tax changes affecting the PRS, with families and professionals expected to be hardest hit by rent hikes, according to Belvoir, but the property franchise insists that rents across the country are not ‘spiralling out of control’.

The company, which has over 300 offices, has published its Q2 rental index, revealing that private rents have increased by an average of 2.75% over the past year, from £730 per calendar month in Q2 2016 to £751pcm in Q2 2017.

Comparing the Q2 2017 average to the 2016 annual average of £783pcm, this indicates rental price growth of marginally below 2%, which is more or less in line with ONS statistics and other rental indexes.

Belvoir’s CEO, Dorian Gonsalves, commented: “Sensationalist media reports that rents are spiralling out of control across the country are at odds with what our offices are reporting, and that other letting agents across the country are currently experiencing. However, feedback from our franchisees confirmed that fewer properties were seeing static rents than in the previous quarter, and more offices experienced rent rises of £25 and £50 per month.

“Belvoir's rental index began in 2009 and is an extremely valuable resource, which analyses the ups and downs of the rental market not just at national level, but regionally and at county level.

“We are also tracking tenant demand, length of tenancies, arrears and evictions with predictions for rental demand in the next quarter.”

The latest data shows rents range from £597pcm in the North West, £665pcm in Yorkshire, through to £1,048pcm in the South East and £1,446pcm in London.

In the capital, the average rent recorded in Q2 2017 was £1,454pcm, excluding Central London, which is an increase of 4.5% compared to Q2 2016.

However, Q2 2017 versus the 2016 annual average of £1,511pcm shows a fall in rents of around 4%. For London, during Q2 2017, half of Belvor’s offices recorded a slight fall in rents and half recorded slight increases.

Around 40% of offices In the South East experienced a slight rise in rents during Q2 2017, whilst 40% recorded slight falls and 20% experienced static rents.

Three quarters of offices in the South West experienced a decline in rents during Q2 2017, with the remaining quarter recording slight increases.

This pattern continued in East Anglia, Yorkshire and the East Midlands where half of offices recorded small rental increases and the remaining offices experienced slight falls.

In the North West, just over two thirds of offices experienced slight increases during Q2 2017, and just under a third experienced slight falls with stable rents in remaining offices.

Reflecting on Belvoir’s rental trend predictions for different rental sectors in Q3, Gonsalves said: “Families and professionals are most likely to experience rent rises. Demand from tenants on benefits saw the biggest increase versus Q1 and therefore rents are expected to rise for this sector. Two to three bed properties remain in demand and are in short supply.

“Although we are not currently seeing a huge exit of landlords from the market it is apparent that landlords are beginning to sell their properties. Most agents expect investor enquiries to remain the same, or to fall, especially for room rents.”

Average void periods for one week remain the same, although there has been an increase in two-week voids, according to Gonsalves.

He continued: “The majority of tenants are staying in their properties for longer, with almost half choosing to stay for 13-18 months, and over 36% staying for up to two years.

“Importantly, over 80% of Belvoir offices carried out no or just one evictions during Q2 2017, This is a good indication of how well our referencing and property management systems are performing and highlights the importance of tenants choosing a reputable agent when renting their home.

“Almost 70% of Belvoir agents believe the government has under-estimated how many landlords will be affected by the changes to mortgage interest relief, and we look forward to the results of our Q3 rental index with interest.”


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Paying rent ‘in full and on time’ should boost a tenant’s credit score, says RLA

Private tenants who pay their rent on time should see their credit rating boosted in order to make it easier for them to gain a foot on the housing ladder.

That is the call being made following a survey of almost 3,000 buy-to-let landlords carried out by the Residential Landlords Association (RLA), which found that 61% of landlords would support such a move.

 Credit rating agencies do not currently routinely include rent payment history when calculating credit scores. This means a tenant can find it difficult to access a mortgage, even if they have a long history of rent being paid in full and on time.

The RLA believes that including rent payment in this way would also make it easier for landlords to make a more accurate assessment of a prospective tenant’s credit and rent payment history, and that is why the trade body is writing to the government calling on it to work with the industry to include rent payment history as a standard feature when calculating credit scores.

The RLA’s chairman, Alan Ward, commented: “With many tenants wanting to buy a house of their own, it is absurd rent payment is not routinely included when undertaking credit checks for mortgage applications.

“Moving to such a scheme would help not just tenants, but also landlords by giving them a clearer sense of whether a prospective tenant has historically paid their rent in full and on time.”


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Second charge lending surges 33% in June

The second charge mortgage market saw new business increase 33% by value and 22% by volume in June compared with the corresponding month last year, according to the latest data from the Finance & Leasing Association (FLA).

This is the fourth consecutive month of growth following six months of falls dating back to August last year.

The number of new second charge mortgages in the first six half of the year was 10,401, up 11% year-on-year.

“In the first half of 2017, consumer finance new business grew by 5% compared with the same period in 2016, in line with modest single-digit growth expectations for the year as a whole,” said Geraldine Kilkelly, head of Research and chief economist at the FLA.

The second charge market has performed strongly recently, despite the fact that consumers and investors have been hit by rising inflation, as well as ongoing political and economic uncertainty following the general election and current Brexit negotiations.

“This this does not seem to have deterred borrowers looking for alternative routes of financing,” said Harry Landy, managing director at Enterprise Finance.

He added: “With the market continuing to accelerate, it’s hugely important that awareness and availability of second charge loans improves among brokers to help them secure the most suitable financing for their clients. Doing so will help the sector to continue to thrive.”

 


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Rents fall in London despite greater demand from tenants

Average rents continued to fall across many parts of London during the second quarter of the year despite the fact that demand for rental property rose further, according to Foxtons. 


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Top university towns and cities for buy-to-let revealed

Many buy-to-let landlords purchase properties near universities in order to take advantage of the lucrative yields that the student rental market often has to offer, with a new league table compiled by Simple Landlords Insurance claiming that private rental accommodation near universities can generate yields up to 12% per annum, but what towns and cities offer the best returns?

The study by the rental sector insurance specialist found that St Andrews in Scotland currently provides landlords with the best chance of achieving a rental return of up to 12%, followed by Lancaster, Loughborough and Birmingham which offer the potential to achieve a yield of at last 10%, while landlords buying property in Exeter, Durham, Sussex or Nottingham can expect to achieve a return of around 9.5%.

Meanwhile, with an average yield of just over 3%, Oxford offers the lowest value of the universities covered by the study, which effectively took the top universities in the country ranked by the Complete University Guide and examined which offered the best investment opportunity.

The University of East Anglia in Norwich, and Cambridge, Bristol and Surrey universities also featured towards the bottom of the table.

“While the academic league tables are always led by Cambridge and Oxford, our study shows that neither of those locations offers the strongest yield for a buy-to-let investor,” said Alex Huntley, head of operations at Simple Landlords Insurance. 


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Fewer investors using gifted deposits

The number of investors using gifted deposits, a sum of money that is given by a family member forming all or part of a deposit for somebody wanting to buy a property, has dropped by 3% in the last two years, new figures show.

The research from My Home Move has revealed that investors accounted for 4.1% of clients using a gifted deposits between June 2016 and July 2017, a decrease of 2.5% compared to the corresponding period in 2014/2015.

There has been an even larger 5% decline in the number of first-time buyers using gifted deposits in the last two years, although it is worth noting that 88.9% of all gifted deposits are actually used by second-steppers and middle-movers.

Overall use of gifted deposits has stabilised following a peak in the run up to Stamp Duty Land Tax (SDLT) changes.

Commenting on the findings, CEO of My Home Move Doug Crawford said: “What is particularly interesting is the drop in Gifted Deposits to first-time buyers. We know that affordability is a key issue for first-time buyers, particularly as 55% of them are looking to buy properties costing less than £150,000, which gives them roughly a 1% chance of finding a suitable property.

“With gifts to this group falling steadily, it does beg the questions as to whether this is reflective of a drop in the number of first-time buyers entering the market, or whether there are other factors in play.”

“We already knew that the main beneficiaries of gifted deposits were people that were already on the property ladder, but the data seems to suggest that these second-steppers and middle-movers are in more and more need of help to make it onto the next step,” he added. 

Chart 1:

Chart 2:

Source: My Home Move


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Lender overhauls BTL mortgage deals

New Street Mortgages has unveiled changes to its buy-to-let range, while also making key alterations to its lending criteria.

The lender has introduced a reduced reversionary rate option and can now offer a lower assessment rate on its five-year fixed products of 4.5%. It has also increased rates on its five-year fixed rate range by 0.1% to 0.4%.

The mortgages now come with a free valuation option for both purchase and remortgage.

In addition, the lender has also increased the maximum age at the end of the loan term from 80 to 85, and introduced a free valuation option for both purchase and remortgage.

The age increase is part of a growing trend in the mortgage lending sector, according to Daniel Bailey, mortgage broker from Middleton Finance.

He told the press: “We’re gradually seeing more and more lenders upping the ages at which people can have buy to let mortgages. This reflects the interest from older people who are looking for an alternative to pensions.” 


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Legal & General Mortgage Club to host specialist lending events this autumn

Legal & General Mortgage Club has announced its calendar of autumn events that focus on the specialist lending sector.

The half day events, which take place across the UK, will provide intermediaries with insight into the different niches of the specialist lending market, including buy-to-let, second charge loans and the later life lending space.

Legal & General’s autumn calendar follows on from its popular spring roadshows and its first later life lending event. The latter, which took place in June, was attended by more than 60 brokers and lenders.

This year’s agenda for the specialist lending events includes an update on the later life lending market and a panel session on buy-to-let ahead of the approaching PRA changes to portfolio landlords.

Brokers will also gain insight on the opportunities the specialist market presents and how Legal & General’s Mortgage Support Services provide assistance to intermediaries operating in the niche lending space.

A full calendar of Legal & General’s Autumn events calendar can be found below:

Sheffield United Football Club – Wednesday 13th September

Birmingham Aston Villa Football Club – Tuesday 19th September

Ramside Hall, Durham, Wednesday 27th September

Cedar Court, Harrogate – Tuesday 3rd October

Sandy Park Stadium, Exeter – Thursday, 19th October

The Village Hotel, Glasgow – Wednesday 25th October

Holiday Inn Norwich North – Thursday 26th October

More information about Legal & General Mortgage Club’s Autumn Specialist Lending events and registration links for each event can be found here

Jeremy Duncombe, director, Legal & General Mortgage Club, said: “From later life lending to the increasing complexity of buy-to-let, brokers are realising the opportunities in the specialist lending sector and the value of their advice to consumers in this space.

“To reflect on this, we’re pleased to announce our Autumn calendar of Specialist Lending events which aim to provide intermediaries with insight into the niches of the market, from equity release to second charge loans.

“It’s been a great start to the year with our popular Spring Roadshow events and a highly successful first conference on the later life lending sector. By responding to growing interest in niche lending amongst advisers, we’re confident that this new calendar of Autumn conferences will also resonate with intermediaries across the UK.”


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Bridging lender offers free valuations on all new loan enquiries

The bridging loans sector has markedly raised its profile in recent years. It is also becoming better understood by property investors, and that largely explains why gross annual bridging lending is now at an all-time high, as more homebuyers are attracted to the greater flexibility offered by alternative finance providers, including no minimum term and no exit fees.  

As the mainstream mortgage market braces itself for yet another clampdown on buy-to-let lending, a growing number of property investors are turning to alternative finance options to overcome tougher mainstream mortgage lending criteria and stress testing, such as bridging loans, short-term secured loans designed to bridge a temporary cash shortfall, when purchasing property.

In order to take advantage of potential new business, bridging lender, Mint Bridging, has announced that it has more than £30m of funding to lend in September and is now offering free valuations on all new loan enquiries, as long as loans that are fully completed ahead of new Prudential Regulation Authority rules coming into force from 30 September.

Mint Bridging’s offer will credit back all valuation fees to the borrower’s account, following completion of the loan. 

“We are looking forward to rolling out this offering to our network of introducers and hope it will be well received,” said Sinead Moynihan, head of Sales at Mint Bridging. “We have a lot of money allocated to lend in September for new business, and we are confident in achieving this lending target.”

Moynihan added: “It is testament to the team’s dedication and expertise, that we are able to consistently lend these volumes. Our six underwrites are ready to accommodate all enquiries. With a maximum loan size of £5m, we are looking forward to some high value opportunities.”


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