Here is the latest edition of the Property Options’ monthly update on the UK Buy To Let (BTL) market.
Despite fairly negative reports on the state of the economy in the short term house prices appear to be holding up well.
The Royal Institution of Chartered Surveyors (RICS) expects house prices to edge higher over the next year and this view was echoed by Thomas Fisher, an economist at PwC, who said “Our own expectation is that the UK housing market will cool not crash. ”
However the result of the EU Referendum seems likely to cause a slowdown in the UK economy that will continue for some time.
So far the effect of the slowdown on the property market has not been dramatic but there are signs that there will be an impact in the medium term. For instance the growth in house prices in London is forecast to be less than in 2015 when prices increased by 12.1%. For 2016 – 2020 the forecast for London is around 4.0% per annum.
Turning to the rental market the latest edition of the Homelet Rental Index published the following findings:
- 2016 to date has seen a slower rate of rental growth compared to the same period last year.
- The average UK rental value was £913 pcm – this is 3.1% higher than the same period last year (£885 pcm) and a reduction in the rate of increase seen in August 2015 (6.6%)
- Rents in greater London are up by 2.7% year on year – a drop in the rate of increase seen in August 2015 (7.7%)
There is good news in the mortgage market. In addition to historically low interest rates the availability and demand for mortgages has improved. In August The Council of Mortgage Lenders reported the highest level of mortgage lending, including buy to let mortgages, for nine years.
Philip Hammond, the new Chancellor of the Exchequer, is very likely to announce new government funding for housing and possibly legislation to encourage “build to rent” in the Autumn Statement on November 23rd .
Meanwhile the buy to let industry has been lobbying for a reversal in the changes to stamp duty and tax relief on mortgage interest introduced by the previous chancellor. Watch this space!
We will all be discussing the latest developments in the property market at our next PIM on 27 October 2016 at Holiday Inn, Bristol City Centre, 6-9 pm.
We hope you will join us then.
For more info and to reserve your place Click Below
Property Options
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