Published by: Alex Maile
After a soggy start, spring has finally arrived and we have even had some sunshine. The weather is still very changeable, so, as we head towards the final Bank Holiday before summer, I will not be putting my umbrella away just yet!And the property market seems to have been following along a similar path. House prices were falling at the start of the year but, according to Zoopla, they have now stabilised and there is a much-improved outlook for the remainder of 2023. And that’s in spite of the continually rising base rate. Zoopla’s figures show, for example, just after Easter, demand climbed to its highest level this year – some 14% above pre-pandemic figures (2019), the supply of new property to the market, which had been a problem for some time, was up by 66% and sales by 6%.
The rental market, in contrast, is on a very different path - supplies continue to be constricted and rents were up yet again last month. In London, they climbed by as much as 1.2%. The situation is unlikely to be improved by Michael Gove’s Renters’ Reform Bill. After a series of delays, it was finally given its first reading last week and, although it is well-intentioned - giving tenants more security of tenure and empowering local authorities to tackle rogue landlords - it is likely to have a number of unintended consequences.
It’s the ending of no-fault evictions that is the most contentious element, and it is not going down well with landlords. As a consequence, they will be forced to use the courts and Section 8 Notices to remove problem tenants and that could take up to 12 months*.
Landlords have already been leaving the sector and, if more decide to sell up, it could reduce the supply of rental property even further and rents could soar. The irony is it will then hurt the very people the government was trying to help – the tenants. If supplies do contract, landlords’ returns are likely to improve. However, as it will become harder to evict problem tenants, it is vital that they use professional agents, such as us, to ensure that not only are applicants of the highest quality but that landlords are also on top of the increasingly complex regulations.
If you need any advice in the area, we are here to help, so just give us a call.
*For full details of the Bill, please see our Renters Reform Bill article in this month’s ezine.