What do current UK property news headlines reveal? The house price index compiled by a property listings website suggests that the market has more or less returned to pre-pandemic levels. Other sources indicate that average house prices have taken their biggest hit in more than a decade.
In the private rented sector, landlords are encouraged to pursue the available grants for installing EV charging points. And a Supreme Court decision marks a significant step for Rent-to-Rent companies. Plus, it is argued that the cost of making energy efficiency improvements in let properties in Wales should be linked to the level of rent charged.
February 2023: house price index
At the end of the month, the online listings website Zoopla published its house price index for February.
In the past 12 months, average house prices rose by 5.3%. This was lower than the 8.6% increase recorded in the previous year but is roughly the same as market trends before the pandemic.
The demand from buyers and the number of sales transactions are also down compared with 2022 but are still a little higher than in the years immediately preceding the pandemic.
It is gradually becoming a buyers’ market says Zoopla, with sellers having to reduce asking prices by an average of 4.5% – a discount of around £14,000.
Even so, Zoopla forecasts a “soft landing” in the year ahead, with only modest falls in the average price of houses in the UK.
Sharpest fall in house prices since 2012
A less upbeat tone was taken in a story by CNN on the 1st of March.
The Cable News Network points out that in February house prices suffered their biggest hit since November 2012. Prices fell by an average of 1.1% – to £257,406. For the first time in more than two years, this represents negative growth says CNN.
Average house prices have now dropped for six consecutive months and are down 3.7% on the peak reached last August.
Further trouble lies ahead, according to the broadcaster, with some analysts predicting average prices tumbling between 10% and 15% on current values.
Landlords should check grants for EV charging points
A car charging company calls for landlords to pursue every available grant for installing electric vehicle (EV) charging points in their properties, reported Landlord Today on the 2nd of March.
It is hardly surprising, of course, that such a company should make that call. But it makes the point that different grants are introduced and then sometimes withdrawn – so landlords might want to seize the opportunities when they’re there.
The company quotes an example where it helped a landlord secure grants totalling £850 for every one of seven EV charging points installed in the landlord’s let premises. The grants included £350 for the charging point itself and a further £500 for the associated infrastructure.
The grant-aided works added substantial value to the properties in question, claims the story.
Landmark judgment on Rent-to-Rent enterprises
On the 1st of March, the National Residential Landlords Association (NRLA) commented on a recent decision by the Supreme Court about Rent-to-Rent companies.
These are companies that rent a property and pay the owner an agreed guaranteed rent (typically for a period of between 3 and 5 years). The Rent-to-Rent company then lets the premises to other tenants – at a higher rent than is paid to the owner.
The decision in question placed firmly on the Rent-to-Rent company the legal obligations relating to its role as landlord of the rented property. In this case, the Rent-to-Rent company had failed to obtain the necessary licence to let the property, so the tenants sought a Rent Repayment Order for the monies they had paid.
The Rent-to-Rent company failed in its argument that any rent should be paid by the owners of the property even though the latter had received none of the rent. The Rent-to-Rent company was instead held responsible.
Linking costs of EPC improvements to rent levels
A story in Landlord Zone on the 1st of March argues for a different way of calculating what landlords in Wales must contribute to the cost of energy efficiency improvements.
Under current arrangements, landlords would need to contribute to any energy efficiency improvements costing less than £10,000 – that figure essentially represents a cap on what they would be obliged to pay.
The story in Landlord Zone, on the other hand, says that there are many older let properties throughout Wales that are inherently energy inefficient and where improvements would be prohibitively expensive.
Instead, lobby groups such as the NRLA suggest that the amount landlords contribute should be determined by the level of rent they charge. All landlords would need to pay up to £5,000 but only those receiving higher rents would move towards the upper ceiling of a maximum of £10,000.
