Rising Rents

Whilst it does appear to have startled journalists, we should not be in any way surprised that rents are creeping up.

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Headlines claiming September to September rises of 2.8% are a little sensational on the basis that when London is stripped out, the average year on year increase falls to 1.9%. The Office for National Statistics doesn’t publish average rent levels and much of this type of data comes from the private sector – it is impossible, therefore, to make any assumptions about the real cost of rent rises.

Years of under supply in the housing market have been rounded off by the most severe financial downturn in a generation which brought speculative development to a standstill when in the context of typical property cycle, it should’ve been taking off again. Many would-be-buyers have been prevented from buying, mainly as a result of highly restricted mortgage availability and it is only recently that the age of the average first time buyer started to lower after several years lingering at unsustainable levels.

It is a well-known fact that we Brits would typically prefer to buy rather than rent and the notion that rent is dead money will certainly have had a bearing on the amount of rent which people have been prepared to pay. It is counter-intuitive for the typical UK resident to pay the equivalent proportion of their income on rent as they would have on a mortgage. We believe that this may be softening as a proportion of the current generation of would-be-buyers accept that they may have to rent for slightly longer than they had originally planned to.

Whilst rents may be creeping up, so are earnings and we know from analysis of our own tenant group, that many have historically paid a rent far lower than what they could afford according to their earnings.

Many landlords would argue that rents in most areas outside London have been static for some time and that some growth is well overdue. It remains to be seen what impact the inevitable increases in housing supply will have on rents as the supply and demand curves come closer together.

 

Leeds planning – time for change

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If you want to understand what makes the planning system tick in Leeds, then you need to get yourself along to a City Centre Plans Panel meeting at the Civic Hall.

A team of council officers, such as planning and highways specialists, meet with elected members (city councillors) to review and debate all manner of applications. There is a public gallery and an applicant area which is easily identified because it will be full of developers, architects and planning consultants tearing their hair out in frustration and disbelief at the circus which is often played out.

Many of the issues discussed are highly technical and require a considerable degree of knowledge of Leeds City Council Policy, heritage, design and highways. Many of the councillors, who ultimately have the power to determine a planning application, have little or no relevant knowledge.

The dynamics of this meeting, where officers are often overruled, might be considered acceptable in a parish council setting in a small rural community, but there is no place for this in the context of a major metropolitan city with an aspiration to be the best.

A few simple changes could have a massive impact:

  • All councillors who wish to be on a plans panel need to go through external training courses in public speaking, planning, city policy, heritage and how to behave like a grown up in a public meeting.
  • The number of councillors in attendance should be limited by number and restricted to those who have been through the training.
  • Those councillors attending should be asked to sign up to a code of conduct which states that they will properly study the papers before each meeting, refrain from making purile jokes, read or send emails on their iPads (which should be banned from the meetings) or leave the meeting to get a cup of tea from the nearby trolley.
  • There should be an independent officer with the power to steer the meeting, strike inappropriate comments from the record, rebuke bad behaviour and, ultimately, remove any councillor who is not adhering to the code of conduct.
  • Officers need far more power in the final decision around each application and the councillors should be there merely to represent their residents’ views and to see that due process is observed.
  • Local consultation through the planning process often fails to reach the wider population. There is no value in collecting the views of the vocal minority in any given area if the views of the majority cannot be heard. It is the vocal minority who inevitably have the ear of the local councillor who in turn can be confident that he or she can have a significant impact on the planning process through plans panel, irrespective of the views of the majority population.

We need to analyse and overhaul the best practice guide for planning consultation and awaken the silent majority.

Time for change at Plans Panel.

Leeds City Centre Prices Hit a High Note

HARDLY a week goes by when there isn’t a story in the media about property prices rising, falling or even staying the same.

The problem is that most of what we read often relates to either the UK or Yorkshire as a whole, without taking into account all the specific towns and cities within the region, and none of the indexes look at Leeds city centre on its own.

As a result, we’ve done our own research, and our figures show that Leeds city centre’s apartment values have largely recovered to the pre-crisis peak they hit in 2008.  However, the gap between prices in core areas, compared to those in fringe schemes, is now wider than ever.

Values per square foot can now differ by as much as 50 per cent when comparing apartments in premium developments and in very central locations with properties located less than a mile away on the outskirts of the city centre.

Buyers will pay a significant premium for a high quality, well-designed apartment in a very central location and the values of these types of apartments have generally held up much better than lower quality apartments.

A major lack of development in recent years has resulted in a chronic shortage of supply, but there is now a wave of new developments on the horizon.  A new generation of experienced and forward-thinking developers recognise the importance of quality, so there’s some real thought going into the latest schemes, which is great news for Leeds.

This is also good news for anyone currently thinking of buying an apartment- for those who are happy to live on the fringe of the city centre, there are some great deals available, and for those buying in core locations, there is still the potential for further price growth, partly because Leeds is still lagging well behind the likes of Harrogate and York in terms of residential values. This is a complete anomaly when you consider and compare the economic profiles of the three.

Come on Leeds.

Morgans Bolsters Team With Nine New Appointments

New appointments at Morgans City Living

Nine new members of staff have been appointed at City Living Specialists Morgans. The portfolio managers, sales negotiator, lettings negotiator and new business development manager are based across the firm’s Dock Street and North Leeds offices.

This comes on the back of a cracking year so far, with both our rentals and sales teams performing extremely well as the market continues to thrive. This raft of new appointments will strengthen our teams and ensure our clients continue to receive the high levels of personal service our business is renowned for.

Portfolio managers Charlie Lampkin, Gemma Johnson, Katie Radcliffe and Kirsty Helliwell are all based at the company’s City Centre office on Dock Street. All four are the main point of contact for landlords and they are also responsible for handling maintenance queries, carrying out contracting and referencing as well as check ins and check outs for tenants.

Graham Gomersall joins Morgans as a sales negotiator and Felix Hook has been appointed as a business development manager. The pair are also based at Dock Street.

In the North Leeds office, rental portfolio managers Amy Buckle and Amanda Humphrey and rentals negotiator Ellis Cann join the existing team, who all operate from our offices on Otley Road providing tenant, property investor and landlord services across North Leeds.

Our business has successfully negotiated the property downturn and we have had our best nine months in terms of lets, sales and occupancy figures since 2007. Business in both our City and North Leeds offices is up by around 10% in comparison to the same period last year and as we continue to grow and the market improves, it’s essential that we attract the right people like Charlie, Gemma, Katie, Kirsty, Graham, Felix, Amanda, Amy and Ellis to deliver industry-leading standards of customer service to highly valued clients.

From Generation Rent to Generation Buy

David Cameron waited until his closing address at the Conservative Party Conference last week to set out his crusade around affordable housing and immediately incurred the wrath of Shelter, who rarely appear to have any constructive or viable suggestions and Generation Rent, who have taken on a crusade of their own.

Prior to the last election, both parties courted the rented sector unashamedly, and perhaps mistakenly assumed that this was a unified group with a common experience and set of values. As it appears to have transpired, there appear to be two distinct elements of the group – the crafty urbanite, probably single or pre-marriage renting happily in one of our key cities, and the less flexible family group who are currently finding it difficult to buy and who are having to make difficult life choices particularly around schooling.

No-one yet knows what the long term impact of the recent housing slump will have on the scale and longevity of the growth in the rented sector. The percentage of the population currently in rented property has undoubtedly grown significantly over the last five years, but it is in the context of scant mortgage availability, dismal levels of housing supply and the after effects of a disastrous period of economic decline, unprecedented in its scale and depth. This is the experience of many of those who make up ‘Generation Rent’.

It seems likely that the vast majority of British people would still prefer to rent or buy – the Conservatives cite a survey which claims that this is the case for 86 per cent of ‘Brits’- and will do so again if market conditions allow.

The essence of Cameron’s Crusade appears sound – unlock lending, speed up land release and simplify the planning process- it makes no sense in the context of a market starved of supply that authorities are still able to slow the process to a virtual standstill.

As to whether this is a viable crusade or a false dawn, it remains to be seen.

 

Six top tips for dealing with a letting agent

Want to make the most of your letting agent agreement? Read our top six tips for dealing with a letting agent:

1. Work within a target range for rent

When your agent first quotes you a rent, don’t rely on an absolute figure. Your rent will fluctuate over time and as market conditions change, so work within a target range.

2. Don’t lapse onto a periodic tenancy

Make sure your agent doesn’t allow your tenancy to lapse onto a periodic tenancy at the end of the fixed term. In our view, a periodic tenancy puts you at greater risk of a void on the property.

3. Avoid an empty property at all costs

A no brainer, but avoid an empty property at all costs – in real terms, it’s way cheaper for you to reduce your rent than it is to have your property empty. Not only will you be losing your rent, but you will have the mortgage and council tax to pay.

4. Don’t pay mark up on maintenance

You may not realise it, but you may well be paying a % mark-up on the maintenance works being organised by your agent. We believe that maintenance is an implicit facet of the range of duties your agent should be carrying out on your behalf and that this should not carry an extra cost. Be a fair landlord and treat your tenants as you would wish to be treated. There is a clear relationship between the condition of your property and the rent you receive over time.

5. Instil responsibility in tenants

Tenants are householders too and have a responsibility to care for the property and not to simply pick up the phone to the agent every time there is a minor issue. Make sure your agent shares this philosophy as it needs to run right through the agent/tenant relationship.

6. Make sure your fee structure is transparent

Your fee structure should be simple and transparent and should not, in our opinion, contain endless lists of bolt-ons and extras. Fees need to be fair and equitable so that you are retaining as much of your income as possible, but also so that your agent is able to properly resource their business and make a reasonable profit.

 

For more advice and information, visit www.cityliving.co.uk

Landlords: What should you expect from your letting agent?

With literally tens of thousands of letting agents to choose from nationally, and a high street (and virtual high street) full of local options, how do you begin to choose who to entrust with your investment property and what should you expect from your letting agent?

We’ve compiled a checklist of four key things to look out for when choosing a letting agent. If the answer’s no to any of the below, you might want to reconsider who you currently let with.

 

  1. Has the letting agent got a shop front?

Your experience as a landlord will be partly determined by how well your agent manages the relationship with your tenant – so the credibility and stature of the agent you choose is important.

We believe that you should work with a business that has a physical presence, ideally pavement fronting. Tenants will take confidence from the fact that they are able to walk into the agency should they have an issue to report or if they are not getting an appropriate response.

2. Do they have experience and track record?

In busy times in the property market, agents will pop up all the time, tempted by a booming market and the promise of easy fees. Don’t take a risk on a start-up agent unless the principals have years of industry experience with other agencies. You need to be able to get the very best local market knowledge and the certainty that the relevant legislation will be observed.

3. Have they got happy clients?

Unless your agent is able to show you testimonials from clients whom they have acted for over a number of years, you are taking a risk. Landlords are incredibly loyal to their agents, due mainly to the perception that there is a massive risk in changing agents. However, it is not necessarily the case that long-standing clients are happy with the service they are getting, it’s just fear of change / lack of time and knowledge that prevents them swapping agents. Ask to see written testimonials.

4. Are they on top of recent laws and managing properties well?

Agents are now under all sorts of legal and financial obligations (quite right, too), and as they will be acting on your behalf, you need to be certain that they are both aware of and adhering to the latest legislation.

At the same time, they need to be able to demonstrate that they have systems and procedures in place which will ensure that your property is well looked after, properly maintained, rented at the right price and empty as little as possible.

 

For more advice and information, visit www.cityliving.co.uk.

By George, What A Great Team

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When we talk about City Living in Leeds, most of the focus is on the stunning range of apartments available and market trends, but it’s important to remember that there are also a number of people living rough in the City who need our help.

I have been involved with the well-established Leeds charity St George’s Crypt for over 10 years, the charity is based within the thriving church of St George’s in Leeds and has been at the frontline of support for homeless, disadvantaged and vulnerable people in Leeds and its surrounding areas since 1930.

This month myself, and a number of others who want to make a difference, have come together to launch a new property development company with a board of directors that is made up of some of the city’s leading property and construction experts.

St George’s Crypt Development Company will provide homes and community facilities for homeless and disadvantaged people throughout Leeds.  The company’s directors include Mark Henderson from Brewster Bye Architects, renowned quantity surveyor and project manager Richard Cavadino, Joel Owen from The Joseph Rowntree Foundation, Maggie Gjessing, Executive Regeneration Manager at Leeds City Council and Reverend Jonathan Clark from St George’s Church.

Our first site that St George’s Crypt Development Company plans to develop is located next to Saint Hilda’s Church in Cross Green. It will offer 20 homes as well as a range of community facilities.  Our company is also hoping to redevelop and expand a hostel on Regent Terrace in Headingley that currently offers accommodation for 10 men who are dependent on alcohol.

We hope to build on the great work that The Crypt already does in supporting the homeless in Leeds and the objective of St George’s Supported Living is to provide safe, managed homes for clients of The Crypt as they leave their addictions behind and work towards independence.

The sites in Cross Green and Headingley both offer great potential and we’re already considering several other sites across the city. It’s therefore a really exciting time for the charity and for all of us who are involved. The new company will help St George’s Crypt to provide inspirational environments for those in need who are wanting to make positive changes in their lives, which is incredibly rewarding for everyone involved. Visit www.stgeorgescrypt.org.uk/charity/ for how to get involved.

Leeds City Centre Apartment Prices Hit The High Note

Research by Morgans shows that Leeds city centre’s apartment values have recovered to the pre-crisis peak they hit in 2008.  However, the gap between prices in core areas, compared to those in fringe schemes, is now wider than ever.

Values per square foot can now differ by as much as 50 per cent when comparing apartments in premium developments in very central locations with properties located less than a mile away on the outskirts of the city centre.

Buyers will pay a significant premium for a high quality, well-designed apartment in a very central location and this applies to both new-build and resale properties.  Values of these types of apartments have generally held up much better than lower quality apartments following the downturn.

We are selling high quality properties, in core locations, for the same prices that we achieved at the peak of the market in 2008, with interest coming from both investors and owner-occupiers.

There is also a lot of potential for further price growth because Leeds is still behind the likes of Harrogate and York in terms of residential values, which is distorted when you consider and compare the economic profiles of the three.

A major lack of development in recent years has resulted in a shortage of supply, but there is now a raft of new developments on the horizon, which is also welcome news.  Forward thinking developers recognise the importance of quality so there’s some real thought going into the latest generation of schemes which is good for both the market and Leeds as a whole.

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Saxton Hasn’t Let The Grass Grow Under Its Feet

It’s hard to believe almost four years have passed since work completed at Saxton.  Today the development still stands out from the crowd and both homebuyers and investors once again have the opportunity to buy an apartment that is unlike anything else in Leeds city centre.

The development, by renowned regeneration company Urban Splash, sits within an established community in a leafy area in the East Bank area of Leeds and is just a short walk from The Calls, Leeds Dock and the city centre.

Saxton consists of two buildings that were completely refurbished to create 410 apartments surrounded by six acres of land complete with a one-acre private park, sun terrace, residents’ gym with classes, on-site caretaker and advanced recycling provision.  There’s also lift access to all floors, a video entry system, intruder alarms, energy efficient heating system and there are even allotments and sheds available by separate negotiation.

The whole development is finished to an exceptional standard and every apartment offers extremely generous living space and floor to ceiling windows providing lots of natural light and far-reaching views.

Morgans has been closely involved with Saxton from the outset, successfully managing and letting apartments within the development from day one.  We have now just been appointed to sell a portfolio of apartments in the scheme that offer both owner-occupiers and investors a fantastic opportunity.

The properties we are marketing start at £105,000 for a one-bedroom apartment through to £140,000 for a two-bedroom home with parking.  For investors there are several years worth of rental history available and some apartments are available with both the tenant and furnishings in place.

When you consider the size of the living spaces and the overall quality of the development, these apartments offer some of the most attractively priced apartments available anywhere in the City.

Further details are available by calling 0113 3980098 or emailing sales@cityliving.co.uk

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