Instant Valuation

  • House prices and rental values are expected to rise across most of the UK over the next three months, based on the latest RICS sentiment survey.
  • All surveyors in the North and West Midlands thought rents would rise over the next 3 months. Confidence for house price growth highest in Yorkshire & The Humber, North West and London.
  • Expectations of house price growth have risen despite the interest rate rise in December, as stock levels remain close to historic lows.
  • The continued imbalance in supply and demand is also the driving force behind rental growth. National 12 month rental growth projections now stand at 4.5%.
  • Source: Dataloft, RICS (net balance score is calculated by the proportion of survey respondents reporting a rise minus those reporting a fall in the given indicator)

  • Over the past five years (excluding 2020), the number of buyer enquiries per property for sale has been highest during March, April and May (Rightmove).
  • Currently around 75% of properties are successfully finding a buyer, compared to a historical average of around 50%.
  • Properties are selling, subject to contract, 20 days quicker than the five-year average.
  • With interest rates anticipated to rise in small increments over the course of 2022, spring could be a good time to move.
  • Source: Dataloft, Rightmove

  • Mortgage approvals, which surged in 2021 on the back of demand from home-movers, have sustained a high level into 2022, continuing to outpace any period since 2008.
  • Meanwhile, the Bank of England is considering removing the ‘affordability test’ which tests a borrower’s ability to service their mortgage as interest rates rise.
  • However the Loan to Income (LTI) multiple of 4.5 times income will remain and this is proved to be more effective at curbing risk during a housing 'boom'.
  • The removal of the affordability test would make it easier for some first-time buyers to get a mortgage although, for an estimated 83% of renters finding a 5% deposit remains a barrier.
  • Source: Dataloft, Bank of England

  • Government targets state that by the end of 2025 new lets will require an Energy Performance Certificate (EPC) rating of band C or above.
  • Just over half (51%) of all rental properties let out over the last 12 months had an EPC of band C or above, virtually unchanged on the previous 12 months.
  • Mortgage lenders have new requirements too. They must ensure that the average performance of their domestic portfolios is at least EPC band C, by 31 Dec 2030.
  • Landlords will not be expected to pay more than £3,500 +VAT on energy efficiency improvements.
  • Source: Dataloft Rental Market Analytics (DRMA), UK Government – tenancies started 12 months to Feb 2022

  • As of the end of February, gross yields for flats ranged from 3.1% in Prime Central London to 9.5% in Sunderland (North East).
  • The spread of gross rental yields for key cities within a region currently averages 3%, with London having the narrowest at 1.2%.
  • Yields are critical to measuring income returns and gross yields are a good starting point for quickly comparing locations and properties.
  • Generally speaking private investors try to aim for gross rental yields of between 5% and 8%, in order to ensure they cover their costs and make a profit.
  • Source: Dataloft Rental Market Analytics, Land Registry, DLUHC
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