With the cost-of-living crisis and the rising fuel and energy costs it’s no surprise that over 75% of renters are concerned about the impact on their ability to pay rent, according to a survey of over 12,000 renters nationwide conducted by Dataloft with HomeLet in May 2022.
Generation Z renters are the most concerned, 85% stating the cost-of-living crisis will have a moderate to significant impact. More than 1 in 4 rate the impact as ‘significant’
Overall, just 11% of renters feel the cost-of-living crisis will have no impact. However, this ranges from 5% for Generation Z to 18% for Baby Boomers, the latter the least concerned of all age groups.
Rent accounts for an average of 30.5% of renter’s gross monthly income (up to 34% in London). With inflation at 9.1%, a 40-year high and predicted to rise further, households are feeling the squeeze.
over the last 12 months the average age of tenants in Crawley was 35 years falling into that millennials bracket, which means that 24% of tenants in Crawley could be seriously worried about paying their rent, the best piece of advice I would give is to ensure you have good lines of communication and have open and honest conversations so that the issues can be addressed as quickly as possible.
I think as a landlord it is also important to consider a Rent Protection and Legal Expenses service. Should the unexpected happen, you’ll always get the income you expect from your tenants, and it will also support you if you need legal representation to recover your property.
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Following on from my last post on the Census 2021 results I though we would have a look at the population and household growth across England and Wales and specifically Crawley, which has been unequal over the past decade. This has been reflected in property price performance too.
The population of England and Wales grew by 3.5 million between the 2011 census and the 21st March 2021 census, the number of households by 1.4 million.
The East of England and the South West have witnessed the strongest growth in both population and the number of households, but it is the East Midlands and London where price growth has been most significant.
In Crawley itself, the population size has increased by 11.2%, from around 106,600 in 2011 to 118,500 in 2021. This is higher than the overall increase for England (6.6%), where the population grew by nearly 3.5 million to 56,489,800
At 11.2%, Crawley's population increase is higher than the increase for the South East (7.5%). In 2021, Crawley ranked 199th for total population out of 309 local authority areas in England, moving up 17 places in a decade.
The government’s Levelling Up White Paper, releases in February, presented and ambitious 10-year agenda to morally, socially and economically narrow regional inequality. The 2031 census will no doubt provide an indication as to its level of success.
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Source: Dataloft, Census 2021 (March 21st), Land Registry, DLUHC, ONS, based on £psf, Weighted average.
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Personally, I love reading the results of the Census and did you know that since 1801 a census has taken place in England and Wales every 10 years, except for 1941. The 2021 Census is officially the 24th and a ‘digital first’ Census, the majority of responses were completed online.
The first results of the 2021 Census were published on June 28th and show that the population of England and Wales was 6% higher on Census Day 2021 compared to Census Day 2011. The number of households was also 6% higher.
Over the 10-year period property prices rose by an average of 39% with urban areas outperforming their rural counterparts.
An interesting point is that the majority (75%) of people live in urban areas but the rate of population and household growth in rural areas appears to be much higher and this is likely to be due to the impact of the COVID-19 lockdown with many students and young people returned home and households combined, temporarily boosting the rural population.
Thanks for reading
Source: Dataloft, Census 2011, Census 2021, ONS, Land Registry, DLUHC, based of £psf, weighted average.
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- With inflation running high, the Bank of England increased its base rate to 1.25% in June, with another 0.5 percentage point rise forecast before the end of 2022 and potential for a further 0.25 percentage point rise in 2023.
- The typical margin between mortgage rates and the bank rate (1.5 percentage points over the last year) suggests the average new lending mortgage rates will be over 3% by the end of 2022.
- The vast majority of new mortgage borrowers are on fixed rates (representing 92% of new loans over the last 5 years) offering protection from rising payments, at least until the fixed term expires.
- House prices are largely driven by what people can borrow and at what cost, so with rising rates this does start to drive affordability the wrong way.
- Source: Dataloft, Bank of England HM Treasury Consensus Forecasts June 2022
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The government has outlined significant changes to the Private Rented Market in the fairer Private Rented Sector white paper. The measures will form part of the Renters Reform Bill announced in the queen’s speech.
The headliner is the end of the Section 21 so called ‘no-fault’ evictions, although I don’t like the name ‘no fault’ eviction as the section 21 (6a) is a legal notice a landlord needs to serve to regain possession of their property. An eviction can only be done with a court order – just another use of catastrophising language to grab headlines.
No more fixed terms all tenancies to be moved to a Single system of periodic tenancies which will only require 2 months’ notice from tenants at any point and a landlord will only be able to end the tenancy if the landlord has a valid reason, which will be defined by law i.e. a need to sell, move in, rent arrears or anti-social behaviour.
It will be illegal for landlords or agents to have a blanket ban on allowing pets or renting to families with children, or those on benefits.
The decent homes standard will be extended to the private sector for the first time, with councils set to have stronger powers to tackle rogue landlords.
A new property portal one-stop-shop (landlord register?) will be introduced to help landlords comply with and understand their responsibilities, while a new Property Ombudsman will be created to handle disputes between renters and landlord.
This is only a white paper and will most likely change prior to being passed into law, landlords and agents who operate within the law, should not fear the renting changes proposed by the Government
Source: Dataloft, DLUHC. Link: https://www.gov.uk/government/publications/a-fairer-private-rented-sector
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