Your Latest Property Market Update

Buy-to-Let still proving to be a sound investment

The buy-to-let market has had somewhat of a difficult time over the past few years due to changes in government legislation and taxation. Since July this year, however, the number of buy-to-let mortgages being approved has risen considerably and is proving that there is life in the market for those looking to invest.

With competitive mortgage rates available, especially if a larger deposit has been accrued, anybody who has the desire to become a landlord now has the opportunity to do so. A new report by HomeLet showing that the average rent around the UK has reached a record high of £970 per month demonstrates that the potential to reap rewards through buy-to-let is exceptional.

HomeLet data shows that rents have increased in every single region of the United Kingdom over the past twelve months, up to 3.5% greater than at the same point in 2018. For those looking to invest, this presents tremendous opportunity to be able to invest locally and see the benefits.

Biggest annual increases in average rents

Region	August 2018	August 2019	Annual Change
London	£1,632	£1,689	+3.5%
North West	£717	£741	+3.3%
South West	£826	£852	+3.1%

In terms of rental yields, we are also seeing record highs in terms of the average yield that landlords are reaping, with the average now reaching 4.5%, up from last year and the highest in three years. For those looking to maximise their yields, there is a growing trend towards Houses of Multiple Occupancy, or HMOS, as they tend to provide a yield approximately 20% higher than a typical rental property.

Which region provides the best rental yield?
North West 6.20%
Yorkshire & The Humber 5.90%
East Midlands 5.40%
Scotland 5.30%
West Midlands 5.10%
North East 5.10%
South West 4.40%
Wales 4.20%
East of England 4.10%
London 4.10%
South East 4.00%
National average 4.50%

Everything you need to know about the Bank of Mum and Dad

There are huge lenders in the mortgage market around the United Kingdom, with high-street names competing fiercely with one another for potential business. One of the largest current lenders may well surprise you, however, as rather than a large financial institution it is the bank of mum and dad which sits at 11th in the list of largest mortgage lenders in the UK.

Parents and family members are set to lend more than £6bn in 2019, which amounts to a higher amount in mortgage pay-outs than well-known brands such as the Co-Operative Bank and Skipton Building Society. With deposits becoming ever-increasingly difficult to amass, many people are now counting on their relatives to help them take that first step onto the property ladder; recent research from Legal & General and Cebr has found that nearly 20% of all property transactions are now aided by parents and grandparents.

Those lucky enough to be able to tap into this valuable resource will be aided predominantly by cash gifts, with some releasing the equity in their homes in order to help their children (16%).

Nigel Wilson, Group Chief Executive at Legal & General, says: “The Bank of Mum and Dad continues to be the ‘iceberg’ mortgage lender beneath the surface of our housing market – all but invisible yet exerting a massive influence, funding purchases across the country and helping people to defy the economics of affordability and realise their housing dreams.”

If you are thinking of using the bank of mum and dad, then there are a few considerations to take into account:

• Banks and building societies will accept a deposit, or part thereof, that has been gifted to you – some may require confirmation in writing that the money is indeed a true gift.

• If cash is gifted to you then this may be subject to Inheritance Tax (IHT) if the gift giver is deceased within seven years of the gift.

• Inheritance limits are £3,000 per year, and previous years’ allowances may be utilised before IHT comes into play. For example, two parents could gift £18,000 with no IHT due as long as they had not gifted anything in the previous three years.

• If the money is a loan, then this will need to be declared to your potential mortgage provider detailing repayments, interest, timescales and caveats.

Family Fun and Crafts

Friday 21st February

Join in with craft activities to create your own Antarctic adventure.

Click here to read Family Fun and Crafts.

Cities are making a comeback with buyers and tenants

The pandemic took a toll on the UK's previously bustling cities, with empty streets and closed down businesses becoming the new norm for many residents.

Due to changing lifestyles, it wasn't long before buyers and tenants turned their attention to rural living, with increased enquiries and searches for properties in more remote, tranquil locations.

In fact, for most of 2020, demand for rural properties outweighed demand for city properties, with countryside searches on Rightmove up 69%.

With the easing of lockdown restrictions and the prospect of the UK getting back to normal, we've now seen that interest reverse once more, with urban living now taking the lead.

What are buyers and tenants looking for?

From January 2021, flats located in major cities have seen a 39% increase in demand, says Rightmove.

This shows a strong contrast from 2020 trends, where ‘larger family homes’ were the most popular choice.

But what are the reasons for the sudden switch in demand?

As well as the lockdown roadmap, another huge factor behind the spike in interest for cities is the UK's vaccination program and successful rollout, as this has led to optimism for the housing market and consumer spending in general.

With a range of stunning properties available with us, why not discover your next home?

How to avoid mortgage red flags as a prospective homeowner

Taking your first step onto the property ladder can seem daunting. There are a number of unfamiliar hurdles and legal requirements on the way to homeownership, but with the right support network, it can be efficient and pain-free.

According to recent data, around 35% of first-time buyers have experienced mortgage rejection, with certain brokers and lenders detailing unusual money mistakes as the main factor behind this.

To give you the best chance at getting approved the first time around, here are the red flags you should look to avoid.

Joke references when transferring money

What may seem like a joke amongst friends could turn out to be a very costly mistake.

Joke references can actually cause a delay in the mortgage process, so be careful and sensible when choosing your reference names.

Betting or gambling transactions

An occasional bet on something like the national lottery won’t have an impact on your application.

However, regular betting will be weighed up by lenders, who will decide if you are in a position to comfortably pay your mortgage each month.

Serious problems can arise from excessive gambling, but few take into consideration what the repercussions could be when looking to buy a house.

Making a big splurge purchase or giving money

Now, we aren’t telling you to not give money, but lending and spending large sums of money can raise questions from lenders.

The same applies to making a high number of purchases in quick succession, even if it is something for your future property, such as furniture.

Seeing less money in your bank than usual can cause delays throughout your mortgage process if calculations don’t quite add up.

Struggling to wrap your head around your mortgage options? Talk to the experts today, contact us for more information.

Low cost changes to increase your home’s kerbappeal

Whether you are considering putting your property on the market or you are simply looking to increase the aesthetics of your front garden, there are a few low cost tips that can help you increase your home’s kerb appeal.

What to consider when upgrading your property’s exterior:

1. How much you’re willing to spend

Working out a budget will provide you with a clearer understanding as to what projects will be achievable.

If there is a limit to how much you want to spend on this area, prioritise the projects that you believe will make the most difference.

2. What are your main goals?

What are you looking to achieve from re-decorating? Are you interested in creating a green space outside your home or are you looking for practical solutions and storage options?

Painting your exterior adds 2-5% on your property's sale value, so if you're looking to move in the near future, it's important to know where to focus your attention for the best returns.*

Have you considered these options?

Refresh your front door

Your front door is the most noticeable feature when entering a property, so it’s worth considering an upgrade if it's peeling or looking tired.

Add your own design accessories

Door accessories, stylish house numbers, lights and retro flower pots are all on trend.

They are also very simple but effective ways of increasing the aesthetics of your front garden for any guests or prospective homebuyers!

Clear your garden

Last but not least, the lawn plays a key part in your home’s kerb appeal.

In fact, 67% of homeowners state that a tidy front garden would improve kerb appeal to them the most.**

If you’re looking to begin the process of buying or selling this month, contact our team today.

*Home Logic

**Goodmove

Eviction notice periods now at four months

From June, eviction notice periods have been reduced to just four months for landlords, instead of the six months they were previously set at to protect tenants over lockdown.

In cases of extenuating circumstances or anti-social behaviour, notice periods will be lower.

After a year of restrictions and economic uncertainties, the change is part of a phased approach from the government to help the country regain normality.

Before the changes, there had been a ban on bailiff-enforced evictions to protect tenants during the ‘stay at home’ instructions.

The UK’s housing minister, Christopher Pincher, has continued to pledge support from the government for tenants, whilst balancing the needs of landlords.

He stated that crucial financial support will continue to be available, with the furlough scheme and universal credit uplift currently in play.

Many people in the property sector have agreed with the changes, stating that now is a sensible time to roll-back the measures as restrictions come to an end.

Whilst the ban on evictions has caused financial distress to some landlords, it seems to be regarded as a success in the wider picture.

We are committed to helping our landlords and tenants with their every property need.

If you have any questions regarding the reduced notice periods, or a general query or concern, get in touch.

Norwich Community Choir

Tuesday 25th February

A friendly local choir for anyone who loves singing.

Click here to read Norwich Community Choir .

Our guide on 'gazumping' and how to avoid it happening to you.

If you’re looking for a new home, or are looking for your first home, then “gazumping” may be a term that you aren’t particularly familiar with. Essentially, gazumping is when you have had an offer accepted by a seller, and are in the midst of the buying process, when another buyer comes along and offers a higher price, effectively stealing (or gazumping) the sale.

Over the period between January 2016 and October 2018, analysis by TwentyCi found that 16% of buyers were gazumped. In the current property market, where demand for properties is high, gazumping continues to be prevalent, and the research found that Sheffield is the area with the highest level – with 35% of buyers out-bid at the last moment.

Phil Spencer, TV presenter and co-founder of Move iQ, said: “For anyone who thought gazumping vanished with the runaway price rises of a few years ago, our findings will come as a reality check.

“Gazumping is alive and well, and still causing heartache for tens of thousands of buyers across England and Wales.

“Britain’s fragmented property market is throwing up huge regional extremes. In hotspots where prices are still rising fast, sellers can be tempted to go back on their word to a buyer if they get a better offer elsewhere.

“Meanwhile, in slow markets, the lack of homes for sale can lead sellers to leave would-be buyers in the lurch if they get a last-minute offer from someone else.

If you want to avoid the spectre of being gazumped, then having all of your buying processes in place before making an offer will help. These involve having a mortgage in principle in place, a conveyancing solicitor and a surveyor in mind; all will help to avoid long periods of waiting which offer the opportunity to others to make a higher offer. When you make your offer on a property, you could also ask as a condition of the offer that the property be taken off the market immediately which will then protect you from other prospective offers.

Britain’s Gazumping Hotspots

Sheffield – 35%
Madistone – 32%
Cambridge – 28%
Birmingham – 26%
Manchester – 25%

The importance of realistic asking prices

Recent analysis from comparison site Zoopla has shown the benefits that are reaped when a property is priced correctly rather than over-ambitiously, with overvalued properties taking up to two months longer to sell.

In addition to a longer sale period for properties which are overvalued, the research also found that by dropping the price in order to attract buyers, these properties also achieve an average asking price of £12,000 less than their more accurately valued counterparts.

“Our research highlights the importance of accurate pricing and reveals the areas where there is the healthiest alignment between a seller’s expectations and what a buyer is willing to pay for a property,” said Charlie Bryant, managing director of Zoopla.

“When a home is valued too ambitiously at the start, or simply overpriced, the sales process can be derailed. Homes can languish on the market for much longer than they should and the vendor loses control of the sale, often leading to price reductions,” he pointed out.

“Agents in Salford, Driffield and Dronfield stood out in our report in aligning their vendor expectations with the realities of the market, and what a potential buyer is willing to pay for that particular house, in that particular location.

“The English and Welsh average sold price, which amounts to 96.3% of the asking price, indicates a market realism, and moreover a market that is transacting good values, despite wider macro-economic and political concerns,” he added.

This research shows the important part which an estate agent plays in those initial meetings, with an over-valuation extremely attractive at first, but damaging in the long-run. If you are thinking of selling your property, then complete your own research so that you can have open and honest conversations with your agent in order to list at a realistic value.

Tips on selling as the days get shorter

As the days get shorter, it is more important than ever to present your property in an appealing manner if you are going to attract potential buyers. With that in mind, we have put together some season-specific advice to help you find a buyer…

Let in the light
Never is it more important in the year to keep your rooms bright and airy than during the change between seasons. This is because of how quickly the levels of light fluctuate, turning your lovely property into a less-appealing version of itself, with dark rooms and corners. To avoid this, use uplighters to brighten up your rooms during viewings – this type of lighting can be easily placed into corners or areas which may appear darker. Furthermore, blinds and curtains should be drawn back to allow plenty of natural light and don’t forget to turn any lights on in cupboards etc. to create multiple sources of brightness.

Keep paths clear
During this time of year, leaves may start to fall from the trees leaving debris around your property. Ensure that your kerb appeal is kept to its maximum by clearing away any errand plants and debris from your property, especially on the path to your front door where potential buyers will most certainly be surveying. If you have the time, consider tidying up your flower beds and removing and shrubbery which may not be looking quite as lovely as during the summer months.

Clean, clean and clean again
Of course, presenting your property in a clean and tidy state is a given, but it’s also worth considering any other areas that you can spruce up in order to maximise the available light. Clean your windows regularly to ensure that they sparkle for prospective buyers and let in as much natural light as possible (this will also help with the aforementioned kerb appeal). Clean your front door so that it looks at its best – many of us will have white UPVC doors to match double glazed windows, and if this is the case then use some bleach to rejuvenate it.

Increase the pressure
You want your property to seem cosy and inviting, and the drop in temperature gives you the perfect chance to make your home comfortable and welcoming. Turn the thermostat up so that during viewings your property is warm and incentivises viewers to really take their time looking around before they brave the cold weather once more. If you have a fireplace, think about lighting it up or at the very least light some candles.

Government announces reforms to planning and Help-to-Buy

Housing secretary James Brokenshire has recently unveiled his plans to introduce new quality controls on housebuilders, whilst also implementing new legislation to try to prevent developers from selling houses on a leasehold basis through Help-to-Buy.

“We have long recognised that we have a responsibility to confront unfairness in the leasehold market,” commented Brokenshire. “Last year we consulted on proposals including the leasehold house ban and ground rent reduction.

“Today I can confirm we will go ahead with our original plan to reduce ground rents on future leases to zero, as opposed to a cap of £10 per year.

“And we will legislate to ensure that in the future save for the most exceptional circumstances all new house will be sold on a freehold basis. We are committed to taking bold action to reform the sector and will be pressing ahead as soon as parliamentary time allows helping us delivery our promise to make the home buying and selling process quicker, cheaper and easier.”

The housing secretary’s plans aim to help future homeowners in purchasing their first properties in a more timely and cheaper manner. These plans go hand-in-hand with the government’s pledge to deliver 300,000 new homes a year by 2020. According to the plans, if a buyer is sold a leasehold home then they will be able to get their freehold at no extra cost.

The Help-to-Buy scheme has been a flagship system that has been fundamental in first-time buyers entering the market since April 2013. From 2013 to 2018 the number of new-build property sales has increased from 61,537 to 104,245 – which can be largely apportioned to Help-to-Buy, with 38% of all new-build sales supported by the scheme.

Addams Family Musical

Thursday 27 February - Saturday 29th February

At the Jane Austen College, Norwich

Click here to read Addams Family Musical.