2017 Review - The Year That Shook The Industry
2017 Lettings News
2017 has been an eventful year within the lettings industry including items such as the ban on letting agent’s fees. Throughout the year we’ve had our finger on the pulse, and while it’s not always been positive, we’ve been here to help you continue to make the most of your lettings business.
As the new year approaches we’re looking back at what we’ve been discussing in 2017 and look forward to 2018…
Agency Fees Were Banned
This news rocked the industry when it was proposed at the Autumn Statement in 2016 and we’ve discussed the topic frequently since then. With the legislation soon being put into action we aimed to help our clients through the change with a series of helpful articles.
After speaking to our customers, it became apparent that many were worried about the losses they would experience from the ban on admin fees. So as industry specialists, we did some research on how agents can recoup losses from the ban and discovered that the key is to introduce value-added services that will aid the tenant and landlord mutually. If you’re interested in finding out more please read our article.
The Brexit Effect
Similarly, Brexit also came as a shock to many and left landlords, agencies and tenants in the dark about the effect leaving the EU may have on the lettings industry.
Throughout 2017 research suggested that an increasing number property deals were stalling due to the referendum vote, with landlords discouraged by the unpredictable future of the housing market. In fact, it was revealed that 45% of landlords with property in and around London were reviewing the size of their property portfolios.
In addition to Britain’s impending Brexit deal the industry dealt with changes and limitations in the buy-to-let program, which commonly resulted landlords increasing their rent.
Due to these changes it’s no shock that London was left out of the UK’s best buy-to-let locations. London is one of the world’s major cities with a 24 hour tube service and one of the largest and most varied job markets in the country, so why are landlords leaving? Benefits of living in the vibrant Capital come at a price and are reflected in the general cost of living. This increase of costs, combined with increased buy-to-let mortgage prices and a general air of uncertainty, could be the reason why.
Tenants left the capital
October 2017 marked a milestone for the London property market as the number of private renters leaving the capital reached a five-year high. With housing/rent prices soaring and the average salary in London remaining the same, it’s no surprise that renters are relocating to smaller towns.
However, some research has suggested that leaving London is a ‘rite of passage’ for those in the 30+ demographic and this could be supported by the fact the twenty-something demographic are not deterred and have a positive net migration to the city.
Despite these changes in the letting industry it seems the property market in London is still buzzing. The lettings industry is becoming more and more digitalised with estate agents and letting agents quickly adopting the use of property portals such as Zoopla and Rightmove in their work. Agents have even created their own portal, OnTheMarket, to challenge their competitors and combat the idea that they have created a duopoly.
The challenges created have caused some unrest in the industry. We considered the matter further and discussed whether the property portal bubble would burst.
Looking Forward in 2018
Charlie Saunders, Managing Director of Assist Inventories says,
“2017 has been a turbulent year with the industry facing a lot of uncertainty, it’s fair to say the lettings market has not been for the faint hearted. We’ve seen many of the Capital’s landlords selling up and disposing of properties leaving only the brave expanding their portfolios, but it is our opinion that it is still a profitable profession if managed correctly.”
If you are continuing to let in London then let us help you ensure that your investments are protected against costly claims.
Talk to us about how we can assist with your inventory reports leaving you free to ensure you are investing wisely and maintaining your portfolio size.