Munrolock News

Rent boost for buy-to-let landlords

The supply of new properties coming on to the rental market has fallen for the second consecutive quarter possibly bringing an end to the downward trend in rents that has been in place since the autumn of 2008, says the latest RICS Lettings Survey.

The net balance of chartered surveyors reporting rising rather than falling rents in the three months to January 2010 was zero. This follows five quarters of negative readings, and is in marked contrast to April last year when 58 per cent more chartered surveyors were reporting falling rents, an all-time low for the survey.

In addition, expectations as to the outlook for rents continues to strengthen with a net balance of 33 per cent of respondents believing rents will to rise over the coming quarter (up from 22 per cent).

The more positive picture for rents can be attributed to the continued decline in supply of both flats and houses in the marketplace. Twenty-three per cent more chartered surveyors reported a fall rather than a rise in the number of new landlord instructions for this period, up from 18 per cent in the previous quarter.

Although the weather may have been a factor in this, it is more likely that the upturn in the housing market has tempted many of the accidental landlords away from the lettings market.

Demand remains strong with 16 per cent more respondents still seeing it rise than fall. Would be first-time buyers, unable to get a foot on the property ladder, are still a major source of increasing demand for good rental properties. Houses remain more popular than flats and it is the supply / demand imbalance in this market that is also helping to push rents higher.

RICS spokesperson Jeremy Leaf said: "It is becoming clear that movements in the housing market are affecting lettings: the RICS housing survey has seen a steady increase in the number of new instructions coming on to the market over the past few months, whilst simultaneously we see with this survey that the number of properties available to rent has decreased.

"This is a clear sign that the accidental landlords are returning to the sales market. If demand remains strong, which it is likely to as many first time buyers are still finding themselves priced out of the housing market, then rents should continue to rise as would be tenants compete for fewer properties."

source telegraph.co.uk

Homeowners delay remortgaging

The number of home owners remortgaging when their existing deal runs out is at a record low.

Just 28,000 home owners remortgaged their properties in December last year, down 32 per cent on a year ago, according to the Council of Mortgage Lenders.

It is in sharp contrast to the growing number of people taking out a mortgage to buy a new home.

Bank of England interest rates 'will not rise until late 2011'

Bank of England interest rates will not rise until the latter part of 2011, in the opinion of one finance expert.

Alan Clarke, UK economist at BNP Paribas, says: "During 2011 GDP (gross domestic product) will be very sluggish, we will be in a soft patch and I think inflation will be very low."
He argues that these factors will support the bank maintaining low interest rates for 2010 and much of the following year.

House prices for first-time buyers rise six times as fast

The cost of an average home for a first-time buyer rose by 3.9 per cent in November compared with a decline of 0.7 per cent for those already on the property ladder, according to the latest house price index from Communities and Local Government.