Rent rises could soon outpace house prices, warn surveyors

kinger101

mwpt wrote: »

So we're not at that point yet in your opinion. Appreciate the view.

Btw, are you a BTL landlord?

No. But I lived in London for a few years after graduating. This was at the turn of the millennium. I know that people moving their today have to make far more compromises with their living arrangements that I ever did. Of course, many of the outer areas have improved somewhat, but I wouldn't want to second guess what the situation will be for the next generation of graduates.

wotsthat

Graham_Devon wrote: »

Not quite that simple.

You are treading down the path of HMO's. That's a different ballgame altogether.

It's OK saying people will just have to share in higher densities, but you can't simply ignore all the extra responsibilities such as fire regulation that then land in the landlords lap.

It's far from simple of course. People will put off divorce, the same number of people will migrate to smaller houses, kids leave home later, more multigeneration households etc.

Far less simple and more subtle than people just upping sticks to live in an HMO.

mwpt

I'm going to go out on a limb and say that as the changes come in we will see rents rising no more than historical averages (condition on no big external event). In other words, I disagree with you guys. I guess we'll see over the next few years.

Graham_Devon

mwpt wrote: »

I'm going to go out on a limb and say that as the changes come in we will see rents rising no more than historical averages (condition on no big external event). In other words, I disagree with you guys. I guess we'll see over the next few years.

Agreed.

We also need to consider that rents never fell when the costs of mortgages fell for BTL landlords. It can't be all one way continually. With the exception of a couple of landlords (Chuck, you are included!!), it appears to be morphing into Propery118 around these parts and the landlord appears to be immortal to everything other business has to cope with.

There should be some slack due to the fall in costs thousands of landlords experienced when interest rates fell to the floor, unless they have gone all out on the leverage.

Rich2808

A meteorite could hit the earth next year and wipe out mankind,

Anything COULD happen.

Where is Mystic Meg when you need her - she is probably likely to be as accurate in forecasting house prices or rents as RICS. Just make up a number and issue a press release and you too could get free media coverage and debated on forums.

I think the message is. Do buy more and more houses in 2016 people - pretty please - cos us surveyors are struggling to afford our kids private school fees and need the work! If you rent we don't make any money.

cells

kinger101 wrote: »

30 years ago, it would have been uncommon for someone in their late thirties or forties to be renting in a house share. Now, that's very common in London. 30 years ago, a graduate starting a job in the City of London would have turned their nose up at Barking. It's really not that hard to envisage rents increasing in London. Expectations of what you get for your money can decline rapidly.

yep and you can see this in some of the homes put up for sale, what average homes coming onto the market which have clearly had more than £100,000 work done to them or even ex council homes in big estates which have very nice interiors

This in some way inflates London prices especially in the very expensive areas. Someone buys a house in Kensington and doubles its size going into the rood and digging out a basement. Land registry shows prices up 100% but does not tell you the house has had a million pounds spent on it

cells

Graham_Devon wrote: »

Agreed.

We also need to consider that rents never fell when the costs of mortgages fell for BTL landlords. It can't be all one way continually. With the exception of a couple of landlords (Chuck, you are included!!), it appears to be morphing into Propery118 around these parts and the landlord appears to be immortal to everything other business has to cope with.

There should be some slack due to the fall in costs thousands of landlords experienced when interest rates fell to the floor, unless they have gone all out on the leverage.

mortgage rates fall and rise at a smaller quantity than the BOE rate

There were BOE + 0% trackers some even negative when the base rate was 5-6%. Now its more like BOE + 2.5%

The reason is that a lot of the funding for commercial banks is depositors, depositors who often leave money in 0% or very poor interest accounts

cells

Graham_Devon wrote: »

Not quite that simple.

You are treading down the path of HMO's. That's a different ballgame altogether.

It's OK saying people will just have to share in higher densities, but you can't simply ignore all the extra responsibilities such as fire regulation that then land in the landlords lap.

higher regulations will definitely force higher prices. you cannot enforce higher quality without a price

imagine all hotels had to be 4 star or better, how much would hotel rooms that used to be in 2 star but spent a lot of money to become a 4 star then cost?

Crashy_Time

caronoel wrote: »

Strangely the wise old owls on HPC haven't yet shared the good news.

Vi propaganda, you see ....

My rent has hardly moved since the late 90`s pal, a BBC ramping piece isn`t going to make much difference to my beliefs. This sort of rubbish is just designed to keep people from panic selling BTL flats and spoiling the tax stream the government want to set up. Seriously, any one with BTL`s holding off on selling up on the basis of nonsense like this deserves all they get.

cells

mwpt wrote: »

You really think so? Any stats on people per dwelling over the years? At what point do they simply stop doing this and move elsewhere, and are we at that point, and how do you know?

London is ~2.46 persons per home.

London was ~2.22 persons per home in 2001.

Going forward another 15 years I think ~400k homes will be built and the persons per home figure will drift up towards 2.65. That would put London at a population of ~10.3 million people by 2030

Inner London really needs to up its game with very high density new builds especially lower Hackney, Islington and Tower-Hamlets.