News that demand from tenants for private rental properties will remain strong should bring a boost for landlords around the UK, according to a report.
Real estate firm Knight Frank says that demand has remained strong despite what is a usual seasonal lull and that rents agreed for prime properties in central London are higher in the three months to November than they were this time last year.
The report adds that the number of deals being struck was 23% higher than 2015 too.
In addition, the firm says that August and September were also popular for new tenancy agreements in London and the higher activity levels are down to rents falling because there's more property available.
Falling rents has helped to boost affordability
Falling rents has helped to boost affordability for tenants and many, particularly for prime properties, are now in a better position to negotiate on the rent.
However, rental growth in the UK has now declined to 5% in November and that is the weakest figure seen since December 2009, though the slowdown should be less acute in prime central London.
In their report, Knight Frank says: “There is uncertainty over issues including the decision to leave the EU and also the election of Donald Trump as well as cost pressures being faced by banks, particularly by banks failing to meet stress tests set by the Bank of England.”
The report also highlights that the optimism of landlords in London remains down on last year.
Landlords still don't know of stamp duty change
Meanwhile, it might be hard to believe but a law firm is reporting that they are still working with buy to let landlords who do not know of the stamp duty surcharge.
The firm says that landlords as well as property developers are seemingly unaware that they are liable for the 3% surcharge which was brought in last April when they are buying an additional home in England, Wales and Northern Ireland.
Purchasers are unaware of the extra tax
Liverpool-based Kirwans says the number of purchasers who are unaware of the extra tax is increasing with many discovering at the last moment that their returns are going to be lower than expected.
A spokesman for the firm said: “Since April we have dealt with a number of clients who are discovering that the property they are planning to buy is subject to the tax.
“Most of these clients are realising at the last minute and many assume the 3% surcharge is only for those buying a second home for their personal use.”
