I hope you have had a great week. This week, we have been discussing the general lack of availability of affordable freehold homes in popular investment areas across the country – an issue we have seen cropping up in the news more often than we could count in recent months.
If this is something that interests you, please get in touch with us today to discuss your options. We have a wide portfolio of properties that we can explore in order to find your perfect investment option.
Now, let’s take a look at all the news headlines that caught our attention this week. I always try to summarise the links to save you from having to click through.
Episode 65: Riding the Property Wave: Unravelling the UK’s Housing and Rental Price Rollercoaster –
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Stripe Property Group forecasts a positive trend for the UK holiday accommodation sector in 2023, despite a 24% shrinkage in 2021 due to COVID-19. A recovery of 21% was seen in 2022, with further 4% growth predicted for 2023, resulting in a projected market size of £2.6bn, albeit 4% below the pre-pandemic high.
This decade-long growth, disrupted by the pandemic, is viewed as a potential investment opportunity. The current market size stands at £2.54bn, marking a 38% increase from the £1.8bn in 2013, indicating a robust sector resilient to adversities.
Major lenders like Nationwide, HSBC, and TSB have reduced rates on fixed mortgage deals, indicating home loan costs might be near their peak after almost reaching 7%. This comes as inflation rates fell more than predicted, reducing expectations of further interest rate hikes.
The Bank of England is set to increase rates by a quarter point to 5.25%, with predictions for a peak at 5.75% in March. This relief follows concerns about rising housing, food, and energy costs, with 40% finding mortgage or rent payments challenging, according to an Office for National Statistics poll.
Despite the housing market’s instability, UK rental yields have seen a slight increase over the past year, says property investment platform Sourced Franchise. The current average yield is at 5.2%, a 0.4% increase from last year, with the strongest yields in Scotland (5.9%).
Other hotspots include Northern Ireland, the North West, Yorkshire & Humber, and London. While the South East recorded a slight decrease in yield, rising rent values and falling house prices present opportunities for proactive investors, despite the economic turmoil and increasing mortgage rates.
Housing Secretary Michael Gove has unveiled plans to relax planning restrictions, facilitate conversions of empty shops into residences, and introduce laws to assist leaseholders. These changes aim to support the government’s ambition of constructing one million new homes.
Legislation to end ‘no fault’ evictions and to address anti-social or non-paying tenants will also be introduced, accompanied by a new Ombudsman for faster dispute resolution. Despite these proposals, there are concerns that converting commercial premises into homes could result in poor-quality housing.
That is all we have for you this week. If you have any comments or questions on this weeks news summary then please feel free to hit ‘reply’ – if not, see you next week.
Tobi Mancuso
Director, Track Capital
Listen to The Pure Property Podcast from Track Capital here
