Why have rental properties jumped so high?
Discussion
The OH and I have taken the plunge and just bought a house in Kingston, so are in the process of moving out of the flat we're renting. Last year we signed a 12 month lease at £1,150pm and our landlord informed us that next year would cost us £1,250pm. I've just spoken to the letting agent and he's told me that it's currently attracting strong interest at £1,395, an increase of almost £250 (or 21%) in a year! Apparently an identical flat in the sister building to ours recently let for even more, but our landlord "isn't greedy" and the place isn't furnished.
I know that rental demand is increasing as house sales slow but is this typical? With interest rates at record lows it must be a good time to be a landlord...
And yes, as a non-londoner I did let out an involuntary yelp when I found out how much it was going to cost to live in Kingston. I could have rented an entire street in Northampton for that...
I know that rental demand is increasing as house sales slow but is this typical? With interest rates at record lows it must be a good time to be a landlord...
And yes, as a non-londoner I did let out an involuntary yelp when I found out how much it was going to cost to live in Kingston. I could have rented an entire street in Northampton for that...
Last year was tough for the rental market. A lot of investment landlords sold off portfolios, smaller landlords sold up because they were worried about void periods. Rents were quite low becuase nothing was moving. This year has seen a return of tenants however there is less stock because of '09. Therefore prices are naturally rising again.
I anticipate however that this winter, as the sales market slows then there will be sellers desperate who need to move so end up renting their homes because they can't sell. This will help fill the lack of stock. Although these 'owner occupier' type properties are not always best prepared for the letting market.
I anticipate however that this winter, as the sales market slows then there will be sellers desperate who need to move so end up renting their homes because they can't sell. This will help fill the lack of stock. Although these 'owner occupier' type properties are not always best prepared for the letting market.
spikeyhead said:
What percentage return does the rent provide?
No idea, in the last year I've only spoken to my landlord once. I would imagine that he's doing alright out of it though as he's owned it since 2002 and apparently it's always been let with no dead periods. spikeyhead said:
How much is the house dropping in value?
Prices don't seem to be dipping in my area, although they aren't increasing massively either. Thanks to a good deposit my mortgage repayments are going to be less than my rent was and that's all I care about. Plus of course it's now my mortgage I'm paying off rather then someone else's. My initial post was more directed at the sudden upshift in rental prices more than anything else, as I'm not aware of any new external factors that may be driving it. I thought those more knowledgeable in this area than I may know the reasons.
Alfa numeric said:
spikeyhead said:
What percentage return does the rent provide?
No idea, in the last year I've only spoken to my landlord once. I would imagine that he's doing alright out of it though as he's owned it since 2002 and apparently it's always been let with no dead periods. spikeyhead said:
How much is the house dropping in value?
Prices don't seem to be dipping in my area, although they aren't increasing massively either. Thanks to a good deposit my mortgage repayments are going to be less than my rent was and that's all I care about. Plus of course it's now my mortgage I'm paying off rather then someone else's. My initial post was more directed at the sudden upshift in rental prices more than anything else, as I'm not aware of any new external factors that may be driving it. I thought those more knowledgeable in this area than I may know the reasons.
Alfa numeric said:
Prices don't seem to be dipping in my area
As expected - this is PHAlfa numeric said:
Thanks to a good deposit my mortgage repayments are going to be less than my rent was and that's all I care about.
What did you get your lifetime fix at?Alfa numeric said:
Plus of course it's now my mortgage I'm paying off rather then someone else's.
How do you avoid paying the interest part of your mortgage?NoelWatson said:
Alfa numeric said:
Prices don't seem to be dipping in my area
As expected - this is PHNoelWatson said:
Alfa numeric said:
Thanks to a good deposit my mortgage repayments are going to be less than my rent was and that's all I care about.
What did you get your lifetime fix at?NoelWatson said:
Alfa numeric said:
Plus of course it's now my mortgage I'm paying off rather then someone else's.
How do you avoid paying the interest part of your mortgage?The last two questions are a bit O/T- I know there's a rent vs buy debate on here and I didn't mean to stoke that, I was merely commenting on the near £250 increase in the rentable value of the flat I'm currently living in.
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