Welcome to our latest quarterly newsletter.
With Autumn in full swing there is nothing like home for real comfort so put your feet up and take a moment to read through our newsletter which we hope you’ll enjoy. Should you require advice on any subject please do not hesitate to contact us.
Autumn Buoyancy
As the summer months came to a close and some prepare for a few months of hibernation, the opposite seemed to be occurring in the property investment market which has well and truly awoken in the past month or so. At both our Oakham and Kettering branches of Osprey Lettings, we’ve been witnessing property investors coming back in to the fold, seeking to expand their portfolios and hold on to these investments over the long term.
It’s been interesting to read in the news that Buy-to-let investors in England and Wales enjoyed total returns of nearly 10% in the past year. This was made up of rental yields of 5.2%, while rising property prices took total average annual returns to 9.4% according to the latest Buy-to-Let Index. There has also been strong rental growth with average rents increasing to an all-time record of £816 a month in September, versus £768 a month in September 2014.
Nine out of twelve UK regions are still seeing rent rises on an annual basis with the largest increases seen in Scotland at 8.4 per cent, the East Midlands at 7.7 per cent and Greater London at 6.6 per cent.
Over a shorter timescale only three regions have seen rents rise since August. In the three months to September 2015 only Scotland, the East Midlandsand West Midlands have seen rents rise – by 1.2 per cent, 1.4 per cent and 1.4 per cent respectively, every other region of the UK has seen rents fall modestly.
This is encouraging news and highlights the strong demand for rental property in the East Midlands and specifically in the areas covered by our Oakham and Kettering offices.
Total returns from residential property investment are a mix of rental yields, capital growth and underlying rental growth; which all combine into an attractive investment proposition.
As we continue to seek investment properties for clients who want to enter the market, or existing landlords looking to expand their portfolio our search is not simply restricted to these local areas and we are active in the wider East Midlands market, for example in Northampton, Peterborough and Leicester.
If you are thinking of investing in residential property, our team are always on hand to offer expert, unbiased advice on the right ‘buy to let’ for you.
Staff & Office News
We welcome the arrival of Susan Bouwman who joins our Property Management Team based at our head office in Oakham. Susan has many years’ experience within property management and should bolster the service we can offer landlords in Block Management, Residential Property Management and Accounts.
Congratulations to our Kettering Branch manager Rachael Robertson in passing her ARLA level 3 qualification recently.
Our Kettering office are delighted to have been awarded a property management mandate chosen by a recognised Kettering developer to take over the management of their residential letting portfolio which is spread throughout Kettering and Northamptonshire. This is a great achievement for the office having fought off fierce competition from other local agents and highlights our dedication to standard of service and emphasises our standing as one of the area’s leading Specialist Lettings Agencies.
Local Lettings Market; Rutland, Stamford, Leicestershire & Northamptonshire
Demand for good quality rental properties still remains very high throughout Rutland, Leicestershire, Lincolnshire and Northamptonshire and we expect this to remain the same for the foreseeable future, more so with December approaching and the need for tenants to secure a property and be settled in time for Christmas. Both our Oakham and Kettering offices are reporting a large number of tenant enquiries when a property does become available, this results on average in 3-5 application requests – thus affording us the luxury of being able to ‘pick and choose’ the most suitable tenant for our clients.
Investment Opportunities;
We continue to regularly research the sales market throughout the area to provide recommendations and reports on what we consider ideal Investment opportunities. These will continue to be emailed out on a regular basis. If you’re not already on our mailing list to receive these, please do contact us.
We have a number of different opportunities, some of which we’ve listed below..
PETERBOROUGH; Lyvelly Gardens, Peterborough – £105,000. A 2 bedroom flat with Parking. Service Charge and Ground Rent £825 per annum. This is new build and in a ready to let condition, it would rent for £550per calendar month. Currently on the market for £95,000. Gross Rental Yield: 6.3%
Four Chimneys Crescent, Hampton, – £190,000 A 4 bedroom house located in Hampton Vale area of Peterborough. Hampton Vale is on the edge of Peterborough and is a new build site, the site mostly consists of owner occupiers and professionals looking to rent family homes. This property is currently let for £800pcm. Gross Rental Yield: 5.1%
NORTHAMPTON
Osborne Road, Northampton – £90,000 A one bedroom apartment with parking within a private development in the Kingsthorpe area of Northampton. The apartment is located close to the University campus and properties in the Kingsthorpe area let well. One bed flats in this area let for £500pcm. Rental Yield: 6.7% gross yield
LEICESTER
The Quad, Highcross – One bed and two bed apartments from £115,000. These apartments were built approximately 5 years ago in the Highcross development in Leicester city centre, which is now the main focal point of the city. The apartments have a very good internal specification. With the electrification of the rail line to London due in the next year which would reduce the journey time to an hour the city should benefit from further capital growth. One bed flats currently rent for £575pcm and two beds for £750pcm. Gross Rental Yield: 6%
Regulation Changes
Right To Rent; Right To Rent checks will become mandatory in England from February 1st, the government has announced. Under the new rules, landlords who fail to check a potential tenant’s ‘Right to Rent’ will face penalties of up to £3,000 per tenant.
The new law will mean that private landlords or their agent, including those who sub-let or take in lodgers, must check the right of prospective tenants to be in the country to avoid being hit with a penalty.
Section 21 changes; Important changes regarding section 21 notices, affecting landlords and letting agents, have been implemented through the Deregulation Act 2015.
The main changes apply to the rules on serving a section 21 notice, via the Housing Act 1988, which terminates a tenancy.
The new rules were enforced on 1st October and apply to tenancy agreements entered into on or after that date.
Smoke and Carbon Monoxide Alarms; As announced earlier by Housing Minister Brandon Lewis, from October 2015 Landlords have been required by law to ensure working smoke and carbon monoxide alarms are installed in rental properties in England.
Legionnaires risk assessments; Letting agents and landlords are obliged by law to carry out risk assessments for legionnaire’s disease, and if necessary, take action.
These guidelines apply primarily to England. Other regions and jurisdictions are similar but there may be important differences. This is not a definitive interpretation of the law, every case is different and only a court can decide. If in doubt seek expert advice.
In light of these new rules, we are always keen to promote our property management service to new landlords and to our existing ‘let only’ clients. The changes in legislation seem to be coming in thick and fast at the moment and it is imperative that Landlords know about these changes and act accordingly to avoid penalties.