the 1st April. While this doesn’t seem to have had an effect on prices we defi nitely experienced an increase in the number of £1m plus properties being bought. It will be interesting to see, over the
next few months, what effect the new FirstBuy scheme, announced in the Budget, has on housing transactions at the bottom end of the market.
Letting agency view Rents rose again this month to reach an average of £687 per month, 4.2% more than they were this time last year. With house prices not going anywhere fast and with some improvement to mortgage availability, it should start becoming easier for the Government’s estimated 1.2m households in rented accommodation who aspire to buy instead of rent. Most, however, are kept in rented property by their inability to raise the large deposits they need to get on the housing ladder. While landlords are not making money
through capital appreciation, as the average rental property is worth 1.8% less than a year ago and demand from tenants is still high, enabling landlords to push rents up month on month. In fact we estimate that the average rent will be £715 by this time next year. This means that landlords are getting
good yields and the total annual return on a property now stands at 2.6%. Along with falling tenant arrears, this makes great reading for existing and potential landlords.
• House prices virtually unchanged with a fall of just -0.1% compared to last month with annual growth at zero
• Across England and Wales there have been signifi cant price changes in individual regions
• Seasonally adjusted transactions rose by 6%
• Rents rose for second consecutive month, up by 0.4% to £687 per month, an annual rise of 4.2%
• Total annual returns remained steady at 2.6% as rent rises counteracted an annual fall in rental property prices
• Tenant arrears fell back to pre-Christmas level, with 9.4% of all UK rent in arrears
mortgage introducer MAY 2011 49
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