Welcome to your June newsletter

As we head into the summer months, the property market is continuing to bolster as an increase in market activity continues to benefit home movers. Let’s take a look at recent property market data and how the current market conditions benefit sellers and buyers alike.

Recent market data

According to Zoopla's house price index, there were 20% more properties for sale in March 2024 than the previous year.* There was also a 9% rise in sales agreed during this time period.*

This rise in market activity is partly due to an increase in the average working wage and an overall robust job market, both of which boost consumer confidence. In fact, confidence in personal finances has reached the highest level in more than two years, according to GFK's Consumer Confidence Barometer.** This made homeowners considerably more interested in buying a new home, therefore increasing market activity.

Benefits for buyers:

- More choice

An increase in market activity leads to a wider range of choices available for buyers to consider. This improved choice empowers buyers to explore various properties, compare features and prices, and ultimately make more informed decisions that align with their preferences and needs.

- Price stability

The market remains well balanced as the demand for properties and the supply of homes for sale have equally increased. Because of this, prices are less likely to fluctuate, potentially making for a more stable investment. Increased market activity also helps to create a clearer picture of the true value of properties, further contributing to stable pricing.

- More negotiating power

Due to increased confidence, buyers have the opportunity to be more assertive when negotiating a price for a property. Since the supply of properties is so high, buyers are less desperate to secure a particular property and can carefully consider their options.

- More opportunity for investment

For those looking to invest in property, the increased supply increases their options massively. In a busy market, investors can buy a property, make renovations, and sell for a profit in a shorter timeframe.

Benefits for sellers:

- Increased demand

With more people in the market for a new home, sellers can command higher sale prices for their properties as buyers engage in bidding wars. By achieving a higher sale price, sellers can then look for a higher-value property than they previously considered possible.

- Faster sales

The increased level of demand makes it easier for sellers to find potential buyers, which can lead to faster sales and less problematic property chains. Additionally, if a buyer is particularly interested in a property, they may be willing to pay a slightly higher price to secure a quick sale.

- Flexible terms

Strong demand can give sellers the upper hand in negotiating certain terms. For example, if the seller needs to close the sale quickly, they can choose the buyer who is in the best position to complete the transaction as soon as possible.

- Less pressure

In a balanced and active market, sellers may experience less pressure to accept lower offers or make compromises that they're uncomfortable with. They can feel confident that a more suitable buyer will soon show interest and make a better offer.

How an estate agent can help

Estate agents use their in-depth knowledge of the property market to assist buyers and sellers alike in taking advantage of summer 2024’s active market. They have access to a wide range of property listings and can help movers identify suitable properties that match their needs and preferences. They are also skilled negotiators who can secure favourable terms and prices while guiding movers through every step of the process.

Contact us today for help taking advantage of the market’s favourable conditions

Zoopla*

GFK**

Your home is your most valuable asset, and while the market is in a good position, it could be tempting to place your own price tag on it and try your luck. However, the reality is that you can’t rely on guesswork when it comes to determining your home’s true value. Let’s explore why.

- Your local market is separate from the wider market

While the UK average asking price can give you a rough idea of how the market is holding up, local factors are more significant to the true value of your home. Factors such as proximity to amenities, school catchment areas, local crime rates, and quality of transport links all hold weight in the overall value of the property.

- You could set an unrealistic price

Setting an unrealistic price could be more detrimental to your sale than you might think. For starters, many buyers use online filters to find suitable properties. So, if you’re asking price is too high, your home won’t land on their search page.

Secondly, your home’s asking price should be competitive. If similar homes in your local area are asking for much less, they’re likely to secure a buyer before you do.

Lastly, overpricing your home takes away some of your power to negotiate. An outlandishly high asking price can put off potential buyers, leaving you having to settle for an inferior offer. You could also be at risk of ‘gazundering’ or down-valuing later in the process, where your options could be limited, and again, you might have to settle for a much lower offer than you hoped for.

- You could sell yourself short

Conversely, even a well-informed guess could have you selling yourself short. Without expert insight, you may miss current local trends that have caused your home to spike in value. Underselling your home is another example of setting an unrealistic figure, leaving you in a poor position to negotiate with the buyer and could cause you to settle on a lower price than your home deserves.

- You may not fully understand your true borrowing capacity

Accurate property valuations are important to most major banks and lenders, and your buyer will most likely have one carried out early into the sales process. Guessing your home’s value is risky business when it comes to securing your next mortgage, as overestimating can leave you in a tricky position once your buyer has their valuation carried out.

You’ll need clarity on your borrowing capacity from the get-go before you can apply for a loan, as this could save you a great deal of time and uncertainty when applying for your next mortgage deal.

- Your home is unique

Market averages are important, but they aren’t everything. Unlike online assessments or guesses based on similar properties, an expert valuer will consider your home’s specific characteristics and overall condition before they settle on a figure. This includes things such as layout, repairs and renovations, building age, and anything that makes your home unique and enticing to today’s buyers.

Don’t wonder about your home’s worth - book a professional face-to-face valuation

The rental market is continuing to look strong for landlords as we head into summer, with Zoopla reporting a 7.8% increase in rental prices between March 2023 and March 2024.* Let’s explore how this increase benefits landlords and how a letting agent can help you increase rental prices correctly.

Benefits for landlords

Increased rental income

As inflation drives up expenses such as property taxes, maintenance, and insurance, landlords often adjust rental prices to maintain profitability and cover their investment costs. By making sure you don’t exceed inflation rates, you can remain competitive while still covering your expenses and improving your return on investment.

Financing property renovations

The additional rent income you earn from rental prices increasing can be allocated towards funding renovation projects aimed at enhancing the property’s overall value. These improvements could include upgrading appliances, improving energy efficiency, and modernising interior spaces, all of which can help you command higher rent prices and increase the property’s value to boost long-term profitability.

Mitigating financial risks

Increased rental prices also help you protect your finances and reduce the impact of unforeseen expenses, such as vacancy periods. Additionally, as you can allocate more funds to maintenance and repairs, you are less likely to encounter issues with your property in the future, further stabilising your income.

Why it’s important to set a realistic rental price

Tenant affordability

Although it may be tempting to significantly increase rent, it is important to keep any increases to a sensible level. Setting rental prices too high can outprice tenants and reduce the amount of interest in your property, potentially leading to costly vacancy periods.

Tenant retention

Rental prices directly impact tenant satisfaction, so your current occupants are much more likely to stay in the rental property if they feel that they are receiving fair value for the rent they pay. If the rental price is too high, tenants could seek alternative housing options.

Market competition

An accurately priced rental property is a key component of remaining competitive in the market, as overpricing your property can deter potential tenants and lead to prolonged vacancy periods. Overall, setting a realistic rental price is essential to effectively navigate market competition, attract tenants, and optimise your property’s profitability.

How a letting agent can help you increase rent fairly

A letting agent can play a crucial role in helping you increase rent fairly by providing valuable market insights, professional guidance, and effective negotiation strategies. Using their expertise in the local rental market, letting agents can conduct in-depth analysis to guarantee that any proposed rent increase aligns with the current market conditions.

Additionally, letting agents can advise you on the best timing and rate of rent adjustments to maximise rental income while remaining competitive and fair to tenants. By setting a realistic rental price that aligns with rental inflation, comparable rates in the area, and the property’s value, you can ensure that your property remains accessible and affordable for a broader range of tenants.

Looking to increase your rental income? Contact us today

Zoopla*

As a landlord, preparing your home for the rental market is crucial to attracting tenants and maximising your rental income. From inspections and maintenance to legal compliance and insurance, let’s take a look at how you can make sure your property is ready for a new tenancy.

Inspect the property

Firstly, you should inspect your property and take note of any areas that require attention or repairs. By taking care of these issues in good time, you can present a well-maintained property to potential tenants, increasing the likelihood of securing tenants. This will also reduce the chances of maintenance issues further down the line, which will reduce your expenses throughout the tenancy period.

Present the property

Presenting your property well significantly increases its attractiveness to potential tenants, as it showcases your commitment to providing a comfortable and well-maintained living space. You should begin by cleaning and decluttering the space to create a welcoming environment, before staging the property with attractive décor to highlight its full potential. Make sure to capture high-quality photographs to showcase its best angles and features in rental listings.

Decide between furnished and unfurnished

Deciding between offering a furnished or unfurnished rental property is a crucial consideration when preparing it for the market. Furnished rentals appeal to tenants seeking convenience and immediate occupancy, as they come equipped with essential furniture and amenities. This option can command higher rental rates and attract short-term tenants, such as students and young professionals.

On the other hand, unfurnished rentals provide tenants with the flexibility to personalise the space according to their needs and preferences. These properties tend to appeal to long-term tenants looking for a more permanent living situation and often cost landlords less time and money. Ultimately, the decision depends on factors such as your target market, the property’s location, and local market conditions.

Prepare an inventory

Preparing an inventory is crucial as it reduces the likelihood of disputes arising over damages or missing items during a tenancy. You should document every item included in the property, from fixtures and fittings to appliances and decorations. It’s important to take detailed notes and photographs that accurately show the condition of the property. This will not only protect your investment but also provide peace of mind and establish clear expectations and understanding between you and your tenant.

Make sure you’re fully covered

You should ensure you have adequate landlord insurance coverage to protect your investment against potential risks. Landlord insurance typically provides coverage for property damage, liability protection, loss of rental income, and legal expenses. Without the appropriate insurance coverage, you could face significant financial loss in the event of accidents, property damage, or tenant-related issues.

Adhere to safety regulations

Adhering to safety regulations is paramount when preparing a property for the rental market, as it not only ensures the well-being of tenants but also protects you from potential liabilities. By meticulously following safety guidelines and regulations, such as installing smoke detectors, carbon monoxide detectors, and fire extinguishers, you can demonstrate your commitment to providing a secure living environment.

Use a letting agent

Using a letting agent to prepare your property for the rental market can significantly streamline the process and enhance your return on investment. Letting agents possess extensive knowledge of the local rental market, allowing them to advise you on setting an optimal rental price and attracting suitable tenants.

They handle tasks such as marketing, tenant screening, property viewings, and tenancy agreement drafting, saving you valuable time and effort. Letting agents also have access to professional networks and resources, enabling them to efficiently address any maintenance or repair needs and ensure that your property complies with legal requirements.

By entrusting the preparation of your property to a letting agent, you can benefit from their expertise and industry insights, ultimately maximising your rental income while minimising potential issues and risks.

Looking to expand your property portfolio? Contact us today