Only London’s Highest Earners Able To Rent Privately At Affordable Cost

 Only the top 25% of earners in London were able to privately rent a property in the city at an affordable rate last year, according to official figures on costs across England. Data from the Office for National Statistics revealed that for three-quarters of households, rents in the capital were set at a level equal to more than 30% of their income. The ONS said it considered an area to have affordable private rent if tenants spend no more than 30% of their income on it. Rents in some parts of the country dropped when the pandemic struck but in recent months costs have started to rise again. Read more on the Guardian website.

https://www.theguardian.com/money/2021/oct/06/london-rent-privately-affordable-ons-household-income

Mortgage Repayments More Affordable Than 10 Years Ago

New research and analysis from Private Finance has shown that once buyers have made the upfront purchase for their home, the ongoing cost of ownership is broadly in line with levels seen in 1998. The independent mortgage broker revealed that in 2008, the average borrower could expect their mortgage to account for two fifths (43%) of their monthly income (if purchasing alone), compared to 31% of monthly income in 2018. In terms of actual payments, the average borrower is now saving £104 a month, with monthly repayments down from £804 to £700, a decrease of 13%. This is despite the average house price growing by £51,660 over the same period. Read more on the Property Reporter website.

https://www.propertyreporter.co.uk/finance/mortgage-repayments-more-affordable-than-10-years-ago.html

Housing Costs: Five Surprises Explained

The UK's housing market is changing. People are renting for longer and buying their first home later. Some buy-to-let investors are pulling out, blaming a greater burden of tax, while some potential home movers are staying put amid an uncertain economic and political climate. It means some assumptions about housing costs may no longer be true. Here are five things you may not know about.

1.       First-time buyers are the most likely to buy a home

2.       There's no place like home (with your parents)

3.       Rent to a private landlord is more affordable

4.       We know exactly where we want to live

5.       New homes are not always brand new

Read more on the BBC website.

https://www.bbc.co.uk/news/business-47293697

Private Renting Sector Unfair To Tenants, Poll Finds

As families and children in privately rented homes soar, a new report urges a rethink to make housing more stable and affordable. The research, which included focus groups of both tenants and landlords, represents efforts by IPPR from Sky Data to gain a better understanding of the private rented sector, developing policy options for reform. According to investigations, more than seven in 10 of all privately rented houses are owned by individuals and couples, with 78% of ‘amateur’ landlords renting out a single home. Download the report from the IPPR website.

https://www.ippr.org/research/publications/the-case-for-reforming-private-renting

Seven In 10 Renters ‘Say They Would Need Lottery Win To Get On Housing Ladder’

Seven in 10 renters think they would need a lottery win to afford to buy their own home, a survey suggests. Some 72% of people currently renting said that they would need a lottery win to buy their own home and four in 10 (39%) are pinning their hopes on a family inheritance in order to buy a property. The survey was carried out across England and Wales to mark the launch of the Affordable Housing Commission. The commission has been established by think-tank the Smith Institute with the support of charity the Nationwide Foundation. Read more on the AOL website.

https://www.aol.co.uk/news/2018/10/17/seven-in-10-renters-a-say-they-would-need-lottery-win-to-get-on/?guccounter=1

Build To Rent Schemes Should Be 20% Affordable, Says Government Guidance

As part of an update to its planning practice guidance – which is intended to help planners interpret the National Planning Policy Framework (NPPF) – the government has published a new section on Build to Rent. The guidance states that “20% is generally a suitable benchmark for the level of affordable private rent homes to be provided (and maintained in perpetuity) in any Build to Rent scheme”. It stipulates that affordable private rent should be at least 20% cheaper than the rest of the scheme – in line with the affordable rent product – and should be “physically indistinguishable from the market rent homes in terms of quality and size”, as well as distributed throughout the development. Read more on the MHCLG website.

https://www.gov.uk/guidance/build-to-rent

Mortgages Are Now The Most Affordable Since The Mid-1990s

The proportion of homeowners’ income being swallowed up by mortgage payments is now one of the smallest since the mid-1990s, according to the Halifax. It said typical mortgage payments accounted for less than a third (29%) of homeowners’ disposable income in the last three months of 2017 – down from almost half (47%) during the same period in 2007. This figure is also “comfortably below” the long-term average of 35% for the period between 1983 and 2017. The bank said that in the second quarter of 2013 the figure went down to 26.3%, and ended that year close to 28%. Prior to that, you have to go back to the spring of 1996 for the lowest figure on record: 23.6%. Read more on the Guardian website.

https://www.theguardian.com/money/2018/mar/17/mortgage-payments-most-affordable-home-loans-halifax

Letting Fee Bans To Be Scrutinised

The draft Tenant Fees Bill and aims to deliver ‘a fairer, more competitive, and more affordable lettings market where tenants have greater clarity and control over what they will pay and where the landlord is the primary customer of the letting agent’.  The bill would prohibit all payments to lettings agents and landlords (aside from rent, security deposits, holding deposits and tenant default fees), cap deposits and introduce new civil and criminal offences for breaching the ban. The CLG Committee plans to hold a series of oral evidence sessions in the New Year with experts, tenant, letting agent and landlord associations, and trading standards authorities.  Read more on 24housing.

How Homes Have Got Less – And More – Affordable Since The Financial Crisis

Ten years ago, the financial crisis upended the housing market. Prices went into freefall, and many areas of the country have still not recovered – while others have seen prices soar. In the intervening years the gap between the least and most affordable areas of Britain has almost doubled, according to new research by the Yorkshire Building Society. Perhaps more surprisingly, homes in 54pc of local authorities in Britain are now more affordable than they were in 2007. This is despite the fact that the average house price in Britain has risen 21pc in the same period. Read more on the Daily Telegraph website.

Planning Permissions For New Homes Are Being Granted In The Wrong Areas

Planning permissions granted for new homes are being concentrated in the wrong areas, where there is less need for housing, according to new research by Savills. It found that there is a lack of 90,000 planning consents for homes in the least affordable and most in-demand areas of the country. Only 20pc of planning consents in 2016 were in the most unaffordable places, where the lowest priced homes are at least 11.4 times income. However, 40pc of the country’s total need for new homes is in these markets, while there is a surplus of consents in the most affordable locations. Read more on the Savills website.

UK Will Never Build Enough Homes To Keep Prices Down

Britain will never build enough houses to make property affordable for young people, according to research. A study presented to the Royal Economic Society’s annual conference said those hoping to get on the ladder may have to rely on windows of opportunity created by periodic slumps in the market. However, the overall trend will remain for residential property price rises to outpace salary growth, according to economists at the University of Reading. The government has discussed moves to increase the supply of homes but the changes are on far too small a scale to act as a brake on price rises. Read more on the Telegraph website.

Gap Between LHA And Rents Putting Private Rents 'Out Of Reach'

CIH research reveals in some areas the gap between the shared room rate of the local housing allowance (LHA), which single people who are under 35 and renting in the private sector receive to contribute to their housing costs, and the cheapest private rents in the area, means virtually all of the properties are out of reach. The research shows that in the 46 rental markets in England where the cash shortfall was greatest less than a quarter of private rented homes were available at the LHA. In 17 of those areas ten per cent or less of the market is affordable and in six five per cent or less is affordable. Read more on the CIH website.

Gap Between LHA And Cheapest Rents Making Housing Unaffordable For Under-35s

The gap between Local Housing Allowance (LHA) rates and rents has widened to the point where private rented housing is “out of reach” for under-35s. This is the finding from the latest research into LHA rates by the CIH, which focused on areas with the biggest gap between the set rate and actual market rents. LHA rates should allow applicants to claim enough benefit to pay the rent on a home in the cheapest 30% of the private rented sector. But the CIH’s research found that in 46 areas, less than a quarter of private rented properties are affordable to young benefit claimants. Read more on Inside Housing.

Government To Change Definitions Of ‘Affordable’

The government’s White Paper has revealed there will be changes to the definition of the word affordable. In the document, the government say they “intend to publish a revised definition of affordable housing as part of our revised changes to the National Planning Policy Framework”. They have also stated there will be an introduction of  “a definition of affordable private rented housing” looking at forms of affordable housing such as Build to Rent Schemes. The government will also ensure there is a three year minimum tenancy in new private rented sector accommodation. The plans look to provide families and those saving for a deposit the reassurance to save. Read more on 24housing.