Wednesday, Oct 22, 2008
"Buy-to-let investors have reason to cheer..."
Telegraph: Rental demand up by 50 per cent
[Same article as FT below, only free to view]. The number of people signing up for rented accommodation rose in September, with demand up 50 per cent year on year, according to the UK's second largest lettings agent Your Move, which has 250 branches nationwide. The number of leases commencing in September jumped 4.34 per cent compared to August 2008 - far beyond normal seasonal fluctuations, the agent added.
Posted by drewster @ 04:32 PM (1035 views) Add Comment
17 Comments
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1. sneaker said...
Yes but supply is up massively and rents are plummeting because there's no more City bonuses, corporate lets or Masters of the Universe throwing their cash about.
I just secured a peach of a flat in London for 25% less than the asking rent, and since then I've begun to wonder if I've over-paid given the other prices I'm watching.
2. timmy t said...
My landlord has decided to sell so we are out in January. I am actually glad - there is so much to choose from and everyone is negotiable on prices.
3. hash browne said...
What a load of garbage. Demand is up because thousands of greedy sellers can't get the asking price they want, so they're renting they're house out, whilst themselves renting somewhere else. Therefore, demand may well be up... but so is supply. No mention of the thousands of BTL flats sitting empty then? Didn't think so.
The current situation with mortgage availability is only encouraging FTBs like myself to stay with parents for longer and SAVE for a big deposit for that not too distant day when we can afford to buy a decent place to live.
4. japanese uncle said...
Again this potential demand will certainly prove to be ineffective demand as millions of people will jobs. Then what will follow? Demand for space for living will be shrinking, from three-beds to two, two-beds to one, one-bed, to bed-sit simply because of the severe constraint in affordability. Therefore overall demand-supply balance will not tip in favor of the landlords.
5. stillthinking said...
I think so too. Rental demand is going up equally with empty houses.
Doesn't solve the problem of can't pay won't pay. I think that rents are the key thing to watch now though. Apparently there has been a minimal negligible decline in London, I have noticed it myself, but nothing too major. This will all unfold next year.
I think the government are starting to run out of room to manouvre. I hope they don't do anything stupid. I hope that when Mervyn implied the value of the pound is going to collapse he was doing so for personal reasons of honour, to make clear he wasn't in on it.
Well. What a to do ! Apparently nobody is going to have to pay their debts off which is great ! Well done !
6. sneaker said...
@stillthinking
There has most definitely been a decline in rents in the London neighbourhoods inhabited by financial people. One lettings agent I spoke to has lost half of their tenants as they were all bankers and hedge fund people. That's how I got my new flat 25% under the asking rent - having sold a flat in the street next door two years ago. I think what we're going to see is a "middle class recession" - that's where all the froth was.
I'm going to continue renting and sit this one out!
7. stillthinking said...
Well, I am happy for you. I think I am at the low end of the chain though because I am looking for a 850-900 place, which is fairly expensive for me. I think they have moved down a bit. Thats why I am so angry with housing benefits acting as a bottom as I think that rents have the potential to be very affordable and give a good quality of life, but they won't because they are underpinned by government.
8. stillthinking said...
For those readers outside London, that is a minimum for a one bedroom flat pretty much. Any amount below that you are in a studio or just renting a bedroom in shared. Amazing but true.
9. Sensiblebear said...
@stillthinking
That's why some of us commute. I pay about that (800pcm) for a house in Berkshire. Even after the cost of travel I am still much better off out here.
10. Stevie Dee said...
TSUNAMI WARNING!!! For any prospective tennant, make sure your landlord has bought his property. If not make sure he bought 12 years ago... Even shorter.. make sure he doesn't go BUST!!! Don't be afraid to ask him about his financial risk (for example, tell him that you have heard of silly landlords losing houses and thus making the tenent homeless, guage his reaction), if needs be get it in writing!!!
Finally, get your deposit guaranteed, it is now illegal to pay a deposit, and if the landlord disputes this, tell him/her to "foxtrot oscar".
Tips for the day: Buy ILS and plenty of.. if you don't know what ILS is well that can be your task or exercise for this evening. There are no prizes for guessing correctly.
11. drewster said...
@hash browne,
I agree entirely. The papers are full of stories about accidental landlords who are letting their old house while renting a new place. Often these people are letting out a large house while renting a smaller flat in order to save money, so in fact their net rental demand is negative!
12. Roughdiamond said...
'Denial' is up 50%
13. mytimeisnigh said...
I don't know how you guys from London manage, the rent there is so expensive, it's beyond ridiculous. So much for a labour government, I thought they were meant to be promoters of equality and social justice! On the bright side, at least the tide has finally turned in our favour. Although, it's just a shame that there will be so many innocent people (not buy to let) pulled under by neg equity, just because they lacked our insight and became worn out with renting and bought a home.
14. harold said...
timmy t, suggest to your landlord that you stay until he sells - you'll be there for years!
15. waiting patiently said...
£900 a month would rent a great 4 bedroom house in the NW. It's hard to see the attraction of the SE and London in particular. As Ponzi schemes go, it must be on of the biggest.
16. montesquieu said...
Am paying £1600 a month for a very large 4-bed plus 4 public/double garage/large garden looking onto fields detached place in Berkshire in walking distance to station ... can be in London in 1/2 hour.
According to the land registry details identical places to this were selling for £650-700k at the peak (though nothing has shifted for quite a while now), so I think £1600 is pretty good value (for me not for the landlord - on former seling prices, it's a pathetic 3% yield at the higher rate - but perhaps that will start to look like a decent return with stock markets tanking and interest rates being cut).
BTW identical house in same street is on at £2100 a month right now - no takers (even viewers that I can see) for about 3 months now.
Also my ex-landlord's old place in Somerset is still up for sale or rent, £100k/20% down from his original asking price - 5 months now looking for a tenant, 18 months looking for a buyer ... must be hurting by now (he told me the £1000 rent I was paying was £600 short of his mortgage payment).
Now there's a BTL investment strategy for you (circa 2004).
17. it_is_going_with_a_bang said...
End of article....
Asking landlords what they 'intend' to do doesn't really count for much does it?
Obviously they intended to keep their property didn't they when they bought them?
How many landlords intented to be forced into selling their property?
Not many.
So the survey is fairly pointless.