The UK Housing Market, Post Corona March 2020

Miss Mandy

Moderator
This doesn't surprise me at all. Such homes are prime for the rental market and can comfortably provide an annual 5% return for investors with minimal risk profile even with the punitive stamp duties currently applied. The demand for such investments is likely to offset any significant fall in prices IMHO.
Maybe. My town is 10 minutes away from a major airport so already has a high number of rental properties, that's one of the reasons why it's so difficult for first time buyers here. Often the one and two bedroom places don't even get advertised on the open market as the landlords and estate agents are in each others pockets. That also pushes prices up as landlords compete with each other.
If large scale redundancies start happening at the airport though I think landlords will have to sell as there probably isn't the rental market otherwise.
 

Rasczak

Distinguished Member
If large scale redundancies start happening at the airport though I think landlords will have to sell as there probably isn't the rental market otherwise.
I think many landlords operate on a longer term cycle so are probably looking at the next 10 years. The aviation factor isn't relevant to me but I understand the industry is anticipated to bounce back by 2023 so I suspect many landlords will baton down and hold out - especially as losses in the interim can be offset from tax bills.
 

essgee

Active Member
If its of any interest I have been selling homes for 14 years. June was the best sales month we've had since I opened my business 4 1/2 years ago!
 

reevesy

Distinguished Member
I'm seeing more flats cone onto the market..maybe a sign of landlords's ditching properties?

The fact that a lot of traditionally affordable first time buyer properties are often snapped up by people looking to rent them out has not helped the housing situation in this country
 

Rasczak

Distinguished Member
The fact that a lot of traditionally affordable first time buyer properties are often snapped up by people looking to rent them out has not helped the housing situation in this country.
Why? Landlords rent their properties out so, from a housing perspective, the physical ownership makes little difference. Personally I think that the expectation that everyone owns their own home is not sustainable.
 

reevesy

Distinguished Member
Why? Landlords rent their properties out so, from a housing perspective, the physical ownership makes little difference. Personally I think that the expectation that everyone owns their own home is not sustainable.

well thought it was pretty obvious

cheaper housing being (mostly) snapped up by cash buyers who intend to rent out and add to their already bulging portfolio's .....or builders/investors looking at a quick do up and sell on

seen it time and time again......obviously nature of the beast but cant see the likes of my daughters and their peers buying their own places any time soon

think it is a bit of an british thing to own your property...pretty sure most in European countries rent

how many of these properties are expensive run down flea pits is probably another story
 

Rasczak

Distinguished Member
well thought it was pretty obvious

cheaper housing being (mostly) snapped up by cash buyers who intend to rent out and add to their already bulging portfolio's .....or builders/investors looking at a quick do up and sell on

seen it time and time again......obviously nature of the beast but cant see the likes of my daughters and their peers buying their own places any time soon

think it is a bit of an british thing to own your property...pretty sure most in European countries rent

how many of these properties are expensive run down flea pits is probably another story
That's my point. People buying property to rent out doesn't reduce the amount of housing for people to live in - it just makes it harder for someone to buy. They can still rent and, for many, that might be a better option anyway.
 

Bl4ckGryph0n

Distinguished Member
That's my point. People buying property to rent out doesn't reduce the amount of housing for people to live in - it just makes it harder for someone to buy. They can still rent and, for many, that might be a better option anyway.
Whilst technically that is obviously correct, it can cause a big problem. I mean in the U.K. there were some serious incentives to become landlords. Yet when you look at other European countries that practise was actively discouraged and much more control through less aggressive housing associations. Yet at the same time with good government purchase schemes. New buyers entering the market is good for the whole of the market. But a market distorted by private landlords who take more and more benefit from it through government policy doesn’t help everyone with the opportunity to progress. In my opinion.
 

reevesy

Distinguished Member
all not helped by a certain woman flogging off all the council houses :nono:


george what his name ..amazing spaces did a very good documentary on this subject


..and how other european countries are handling it......basically a lot better than we are
 
Last edited:

Miss Mandy

Moderator
I think it's having an effect on the availability of affordable housing in my area.
I was looking at one bedroom flats at the turn of the year and a few cropped up within my price range, but they sold for over market value in the end. Two of them would have been a mortgage of around £600 a month for me and they were both up on the rental market for £850 a month shortly after they'd been sold. Understandable in some respects as the landlords paid over the odds to get them and have to add a mark up to make their profit.
So while the homes are still technically available prices are continuing to increase and they're getting out of reach of many people particularly those on their own. That then puts more pressure on our inadequate social housing system because people can't afford anything else.
 

ostewart

Well-known Member
well thought it was pretty obvious

cheaper housing being (mostly) snapped up by cash buyers who intend to rent out and add to their already bulging portfolio's .....or builders/investors looking at a quick do up and sell on

seen it time and time again......obviously nature of the beast but cant see the likes of my daughters and their peers buying their own places any time soon

think it is a bit of an british thing to own your property...pretty sure most in European countries rent

how many of these properties are expensive run down flea pits is probably another story
That's my point. People buying property to rent out doesn't reduce the amount of housing for people to live in - it just makes it harder for someone to buy. They can still rent and, for many, that might be a better option anyway.
For the most part the European market is pro-rental which means there are caps on prices and good protection for tenants.

In the UK we do not have caps, and in most places the rent is more expensive than having a mortgage, but due to high rent prices people are unable to save for the deposit to get a mortgage.

The UK rental market favours landlords, if it were better many people would not have an issue with long term rent.

Landlords run businesses here for the most part, they will price out tenants so they can make more money, that does not sit well for people looking to rent long term.
 

Ruperts slippers

Distinguished Member
We were just about to buy post virus, it was quite an eye opener to see the differential in payments between a rental and owning a new build for instance. New build mortgaged properties were 50% less than a rental. And the rentals were nowhere near the standard of the new builds, especially the furnishings re kitchens etc.

The problem is an inequality issue, this has now been exacerbated by this virus and the government closing the economy. As it stands right now the rental market and attitudes of the landlords is unethical and immoral.
 

Rasczak

Distinguished Member
I don't see why people should be surprised that monthly mortgage payments are normally less than the equivalent rental. Mortgages require deposits and are secured by the property if payments can't be maintained. By contrast rental comes with all sorts of protections, intrinsic flexibility, requires the landlord rather than the tenant to invest his money and maintains significant liabilities on the part of the landlord. But the key point is it that rental is a much more viable prospect for many than buying.

New build comparisons are also flawed as many such schemes come with shared ownership or equity division that complicates the comparison.
 

reevesy

Distinguished Member
Well I know the house next door to me rent is double what my mortgage is...plus an extra 50 quid on top of that

Renting is just about affordable for a one bed..and the odd two bed property....have a family and need 3 or 4 beds then you better have deep pockets.
 

Ruperts slippers

Distinguished Member
Ah but the caveat is the rise in equity value that negates your for and against argument.


Otherwise you wouldn't be a Landlord. Overall the investment jeopardy is low.

The living standards are not comparable. Rental quality is poorer than new. Plus the qualitative benefits of ownership are well documented for society as a whole.
 

reevesy

Distinguished Member
Just seen there looks like there's going to be a stamp duty freeze...or increased to £500,000 before you pay

Doesnt say when....
 

domtheone

Distinguished Member
Should help keep house priced propped up:facepalm:
 

MarkyPancake

Distinguished Member
Lenders seem to be adjusting their LTVs as well, so first time buyers are going to find the cost of entry is more, as the goal posts have been moved for how much deposit they need, e.g. was 5% now might be 15%, etc.
 

domtheone

Distinguished Member
Seems sensible enough.
 

Rasczak

Distinguished Member
So, no stamp duty on the first £500,000 of house purchases and the Chancellor has just announced this does apply to additional properties as well :thumbsup:

First thing the Government has got right since this pandemic started. Time to start browsing Rightmove for a pair of new rentals :)
 

Wil S

Active Member
pretty irritating given I took the plunge and moved a month ago when lockdown was lifted. but good if it means someone can buy my old place at a proper level. Agree it's positive for the market, just not entirely for me :-(
 

Miss Mandy

Moderator
I think it depends on what side of the fence you sit as to whether that's something they've got right. Personally I'd say it's great for first time buyers or families looking to upsize, but the last thing we should be doing is making it easier for landlords to buy more properties.
 

Rasczak

Distinguished Member
I don't think it will make much difference to first time buyers - they didn't pay Stamp Duty for anything under £300,000 anyway and most people joining the ladder buy cheaper than that. Upsizers, sellers, second home buyers and landlords are the beneficiaries - but that makes sense as these are the people with secure incomes that the Government needs to get spending.
 

Marth308

Member
The trouble is that all the furloughed people have had their credit scores impacted, and mortgage holidays will also impact them. These scores are often recalculated every 3 months, so it will have an impact.
 

The latest video from AVForums

Podcast: Samsung HW-Q950T Soundbar Review, Filmmaker Mode, Disney+ $30 for Mulan, AV news and more

Latest News

THX Spatial Audio app brings 360 degree sound to any headphone
  • By Andy Bassett
  • Published
Xbox Series X November launch confirmed
  • By Andy Bassett
  • Published
Xiaomi OLED is world’s first mass produced transparent TV
  • By Andy Bassett
  • Published
Tron 3 lands star and director for Disney
  • By Andy Bassett
  • Published
Kef announces KW1 Wireless Subwoofer Adapter
  • By Andy Bassett
  • Published
Top Bottom