Over a Third of Renters Would Like Longer Contracts

Welcome to Surelock Network Auctions’ first Newsletter of the New Year! January can often feel a bit bleak, but we’ve found some interesting snippets that can help you start 2017 in the right frame of mind. Without further ado, here’s what we’ve been mulling over this month.

Over a Third of Renters Would Like Longer Contracts

Recent research from the Citizens Advice has shown that 39% of people it surveyed would like a longer rental contract in the private rental sector (PRS) so they can make their own long-term plans. This was found to be a particular wish among renters with children, many of whom said a longer contract would help them feel less uncertain and that moving less often would be preferential.

With that in mind, perhaps the PRS could work to address these concerns among family renters. Being a Buy-to-Let (BTL) landlord isn’t easy, but nor is being a family in the PRS. While many initial rental contracts are for six month periods, it’s clear that the tendency for them to become rolling contracts with a one month notice period isn’t suitable for everyone. There are times when a landlord might need to be able to liquidise their investment quickly. But, some detailed contractual additions could help families feel more secure that, provided they are good tenants, they won’t be asked to leave with just four weeks to find a suitable home for their family.

And, having the guarantee of a longer contract with a good family tenancy can be beneficial to landlords too. You’ll know any mortgage or associated costs will definitely be paid for the next 12-24 months, before a further agreement is required. Of course, Government changes to legislation and taxation isn’t proving helpful to all PRS landlords, so maybe the Government could help by keeping things on an even keel for a while too?

Rents Rose Faster in Northern England in 2016

Sticking with the rental market, data from BTL property peer-to-peer lender, Landbay, shows that rental growth in the north of England outstripped that of the southern part of the country during 2016.
Specifically, rents in East Midlands, North West and Yorkshire and Humberside all saw rents grow at the fastest pace since 2011. For London, though, rents fell 0.31% in 2016 compared with an average increase of 2.01% for the rest of England.

These figures highlight that BTL yields are looking healthier in the north of England than elsewhere and is a good option for your next investment option. If you’re thinking of branching out into BTL investment further north, taking a look at our upcoming auction catalogue would be a good place to start. Many of the properties that come up in auction are ripe for refurbishment for the rental market and in a good area for it too.

Investing in Student Accommodation Makes Sense

If you’re expecting a big bonus in the next few weeks or months, or you’re just considering your next investment in property, you could do a lot worse than student accommodation. Student numbers in the UK have grown to 2.28 million in the 2015-16 and, following an increase of 30,000 to the number of students universities are able to accept, that number is expected to grow further.

At the same time, demand for shared rooms in University towns and cities is high, with figures from spareroom.co.uk showing up to 22 people competing for the same property or room. Another interesting detail is that student accommodation has performed more strongly than other, more traditional property investments, since 2011.
To take advantage of what could be one of the few relatively stable investment prospects in a likely bumpy road ahead, there are a couple of options. One is to invest in a managed fund that includes or is made up solely of student accommodation properties. The other is to buy a house, houses or flats in popular university cities or towns, refurbish them to a good standard and let them out room by room to students.

If you’re not sure what property is available, why not pop along to your next local property auction? All kinds of properties in all types of locations pop up in auction, giving you the opportunity to buy the perfect student let property as your next investment.

We hope you enjoyed Surelock Network Auctions’ thoughts on the issues discussed in our latest newsletter. If you want to keep up-to-date with Surelock’s auction dates visit our website and to keep abreast of our news and views, take a look at the blog section.

We welcome any comments on the points we have mentioned, or any questions at all, even about a property you are interested in that isn’t listed at one of our auctions. Additionally, if you want to share your own views on another topic, please contact us. You can get in touch by responding to this email, tweeting us @KhalidAuctions or commenting on the blog section of the Surelock Network Auctions website.

1 Comment. Leave new

Longer contracts would indeed be preferable for everyone but the PRS cannot address the issue without help from tenants and government.
For it to work, the following would be needed
a) tenants to pay on time every month
b) tenants not to damage the property, or bigger deposits being necessary
c) government to stop increasing taxes on landlords so that net incomes are unaffected (section 24 of the finance act is so unfairly penal that it is tantamount to declaring war on landlords)
d) landlords to use the correct documentation (usually an AST) and to give the correct notice to quit to tenants. A periodic tenancy / rollover period of an AST still requires the landlord to give two months notice (your post is what most people think, but is actually incorrect) although a tenant only has to give one month’s notice.
e) everyone needs to keep perspective. Apparently 90% of tenancies end with the TENANT giving notice.

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