This blog follows the buy-to-let market in Ilkeston, Eastwood, Heanor and Belper. You'll find properties on here that may make decent investments. You'll also find tips, guidance, and analysis that relates specifically to these two towns. I operate Spruce Tree Lettings, opened since 2009, in all these towns, so if you're thinking of buying a property to let in either Ilkeston, Eastwood, Heanor or Belper, I'm happy to offer a second opinion.
Thursday, 27 November 2014
£14,109,984 – the total rent paid by Ilkeston tenants a year
In the last few months, politicians in Westminster have
decided to step into an area which affects many of us - property. Anyone who
rented property in the 1970s and 1980s knows the difficulties of tenancy
agreements from that era which allowed the tenant the right to stay in the
property for life. In some cases, tenancies could be transferred to their
children, rents could not be increased and tenants could not be removed. One of
the suggestions by one of the opposition parties is rent controls. With more
than 4.4 million people renting 3.4 million properties in England alone, it was
clear that this could be a policy that was purely playing with the sentiments
of these tenant voters.
Under the current legislation, tenants are already in a
position to challenge rent increases that are unreasonable and they have the
advantage of giving a months’ notice to the landlord (when the tenancy is a
rolling agreement ie periodic tenancy) . But do rents need capping? Well in Ilkeston,
there are 5,235 people renting 2,333 rental
properties. The average rent of a Ilkeston property in 2008 was £525 per month.
If Ilkeston landlords had raised the rents in line with inflation, (which
sounds a very fair to anyone), as inflation has been a total of 19% since 2008,
the average rent in Ilkeston should be today £525 + 19% = £624. At this moment
in time, the average in Ilkeston is £504.. and those figures are being repeated
all around the UK.
However, restricting rent rises in the future could put more
properties back on the market for sale as it would destroy the confidence in
the housing market. In turn, this would reduce property prices. With less
property available to rent, and a lack of interest from potential investors
(due to the poor yields) this policy would end up creating a shortage of
Even with the vast increase in renting in Ilkeston over the
last ten years, (5.85% of property being rented in 2001 to 11.8% in 2011), the
number of homeowners in Ilkeston only dropped by 3.2%.It is clear that the changes to the law of tenancy
agreement made in Housing Act 1988 resulted in benefits to both landlords and
tenants. The law has made it easier to rent a property and at the same time,
the Assured Shorthold Tenancy gives the tenants a right to quiet enjoyment of
the property for a period of time. Yes, the total rent paid by Ilkeston tenants
is an awful lot of money, £14,109,984 a year in fact, but as rents are free to
move up, but just as important down, why fix what isn’t broken?