October 2022 Property News
Get an update on all the latest happenings in the property market in October 2022. We cover raising rents, interest rates, converted barracks, and more.
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October 2022 Property News
Here we look at all of the the latest in UK residential property news this month.
Increasing mortgage rates force landlords to raise rents
According to two different reports that were released this week, landlords might be obliged to raise their rents in order to keep their houses mortgageable in the face of rising interest rates.
A poll of about 600 UK residential landlords was undertaken by Superscript, a landlord insurance company. 40% of respondents indicated they haven't raised rent yet, but plan to do so if the Bank of England rises interest rates further, while 50% of respondents said they have already done so for their leased homes.
It is highlighted further by the fact that, in the event of further interest rate increases, 58% of respondents will have to seriously consider selling their rented property (or properties).
However, considering the current financial struggles in the midst of the ongoing cost-of-living crisis, half of respondents to the Superscript survey indicated they would consider freezing rents - should their renters request it.
Research shows that buy-to-let companies doubled in five years, and will do again by 2032
According to the Hamptons Lettings Index, the number of buy-to-let companies has doubled to over 300,000 in five years as a result of landlords transferring ownership of their properties from personal to corporate ownership to utilise tax benefits.
The agent claimed that the change was caused by interest rates rising to 6%, which left the average higher-rate taxpayer who owns a property in their individual name with an average annual tax burden of £1,716 in spite of suffering a loss of £2,479 in income.
Interestingly, according to research from the British Property Federation ("BPF") and Savills, the number of completed Build to Rent (BTR) homes could increase fivefold to reach 380,000 by 2032, with the sector's value totaling £170 billion.
According to the estimate made in collaboration with Get Living, one of the UK's BTR pioneers, and M&G, 8% of UK rental houses will be purpose-built by 2032, up from 1.5% in 2022. According to the report, the market will continue to change, with single-family houses accounting for nearly a fifth (18%) of BTR stock in ten years as opposed to 12% currently.
1,525 new homes to be built in West London former barracks
The go-ahead has been given for the substantial renovation of a former Ministry of Defence property in Hounslow West. It will be a mixed-use development at Cavalry Barracks, to create a thriving neighbourhood with 1,525 new houses, as well as commercial space and more than 10 acres of open space!
Cavalry Barracks and the neighbourhood are rich in history, having a permanent barracks on the property from 1793 until 2021 with connections to Oliver Cromwell, Florence Nightingale, and Winston Churchill. Key buildings will be made accessible to the public in order to celebrate and maintain the site's historic values. Nine locally listed structures and 14 Grade II buildings will all receive modern renovations.
One of the largest undeveloped brownfield sites in London, the old Ministry of Defence site spans over 37 acres and enjoys good public transportation connections to both central London and the surrounding Heathrow Airport, making it a desirable location to invest in property.
It will also add 2,700 square metres of commercial space for stores, cafes, workspaces, and community purposes in addition to much-needed dwellings for a variety of residents. With sports fields, playgrounds, and green open space, the former parade ground will be renovated and transformed into a new public park (which is planned to be twice the size of Trafalgar Square!).
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