Dear Landlords and Colleagues
We promised in February’s Update that we would keep you abreast of ALL movements in the market – whether positive or negative – and whilst the following observation is perhaps neither/nor, we think it important nevertheless.
The London lettings market has been typified by an acute shortage of stock for nearly two years now and whilst this was still very much the case in the first quarter of 2012, there has been an increase in available stock over the last month. This could of course just be a ‘bubble’ and once these properties have been let we could be back to low stock levels once more. However, looking further through 2012 we can see many new developments will actually be build-complete and available for letting.
As the initial recession bit many developers ‘downed tools’ and stopped building and the resulting delay compounded the stock shortage. As many have bought to let, rather than bought to live in, we will undoubtedly see increased stock levels in the rental market. However, at this stage, we don’t consider this to be alarming in any way.
Our own view is that the dramatic shortage of stock of over the last two years served to bring rent levels back to where they are now – I’m sure you will all remember that rents fell shortly after the recession initially bit. If it does indeed play out that stock levels are higher than previously, then we can assure you that there are still plenty of tenants (if you can’t get a mortgage what are you going to do!). However, I think we can safely say that the exceptional rent increases which we have experienced over the last two years will be replaced by more sensible, perhaps inflation-linked, increases.
Sustainability is a bit of a buzz word generally at the moment and it has a place here in lettings too. We need to be appreciative of the fact that affordability will eventually become an issue. If rents continued rising at the same rate, then a time will have come in the near future when quite simply no one will have been able to afford to rent! We are not alone in suggesting that this has how the lettings market is likely to evolve over the next year or so, with Savills Research Department also commenting that they see rents now increasing roughly in line with inflation. The heart of the matter is that more stock is definitely required for a larger rental market, but that a strong, sustainable market will have to a sense of realism running through it.
As many of you will be aware, it has been compulsory for agents’ to show an Energy Performance Certificate when marketing a property for sale for a good while now. On the 6th April The Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Regulations 2011 were amended in many respects, but crucially in two areas. Firstly, when marketing a property for let an EPC should be commissioned as marketing commences, in the same way it is for property for sale, and those details should be available alongside any published written details of the property produced (this includes marketing on the web). Alarmingly the legislation also dictates that the entire front page of the EPC should be published – the front page (rather than just the graph) contains the FULL address of the property! An e-petition was drafted immediately upon the point that publishing of the address could lead to security issues. We’ll keep you posted on any further updates, but suffice to say that someone hadn’t thought through the implications of the amendments…
Currently rightmove.co.uk is by far and away the most visited property portal and according to their own stats is the 8th most visited website in the UK. Last week the Office of Fair Trading passed the proposed merger of Zoopla (zoopla.co.uk) and The Digital Property Group (owners of findaproperty.com and primeloation.com), respectively the 2nd, 3rd and 4th most visited property portals. Whilst the merger is likely to complete shortly, the integration of the three sites is not expected until “much later” this year, according to a Zoopla spokesperson. Currell is one of the very few agents who advertise on all four of these sites, and regardless of how the merger pans out we are committed to offering an exceptional advertising package for our clients.
New appointment for Currell New Homes
Last Wednesday Adrian Plant joined the Currell fold as Director and Head of New Homes. Adrian joins us from Chesterton Humberts and brings with him a wealth of New Homes experience. For further details on our current and upcoming New Homes developments please contact the New Homes team on 020 7226 6611 or firstname.lastname@example.org
Back with you in June.
Christian Thomas MARLA