All the facts and figures on the rental market in Bath & beyond from August 2023, including a mortgage update from Doug Miller of Lansdown Financial Services.
All the facts and figures on the rental market in Bath & beyond from June 2023, including some really interesting information about the differing performances of houses and flat on the market.
Bath landlords came together for an evening of insightful discussions and valuable takeaways at the Bath Landlord Conference held on 26 July 2023, at The Francis Hotel. The event, attended by around 50 enthusiastic landlords, proved to be an engaging platform for industry experts to share their knowledge and expertise.
Toby Martin, the director of Reside Bath and West Country Regional Executive for ARLA Propertymark, hosted the evening and shed light on the intricacies of the local rental market, particularly focusing on the imbalance between property supply and tenant demand.
Michael Tatters, a Partner at Thrings Solicitors, captivated the audience with an in-depth exploration of the Renters Reform Bill and its impending impact on landlords. Attendees were given ample opportunity to raise questions and discuss their concerns, ensuring they were well-prepared for the legislative changes ahead.
Adding a dash of practicality to the conference, Ben Stokes and Michael Skeath from Elite Consultancy Group delivered an engaging presentation on landlord compliance. Their valuable tips and tricks provided landlords with actionable steps to fulfill their legal obligations, steering clear of fines and penalties. Their presentation sparked interactive discussions and left landlords equipped with tools to enhance their compliance efforts.
Attendees actively participated in spirited discussions and posed thoughtful questions to the expert panel, all of which were met with insightful responses.
“We’re thrilled to witness such enthusiasm and engagement from the local landlord community,” said Toby Martin, reflecting on the event. “Our aim is to provide a supportive space for landlords to learn, connect, and stay ahead in the ever-changing private rental landscape.”
Plans for the next Bath Landlord Conference later in the year are already underway. Stay tuned for updates on the next Bath Landlord Conference by visiting www.bathlandlordforum.co.uk.
All the facts and figures on the rental market in Bath & beyond from May 2023, including a close look at how long it takes to let a property and what that tells us about the current market.
Reside’s local experts Chris & Lisa visit one of the city’s most recognisable Georgian terraces.
Over the last five years, life has become a little trickier for Bath landlords, with changes to their taxation status, mortgage interest relief and an additional 3% stamp duty for a buy-to-let property and has made lots of Bath landlords ask themselves:
Regarding taxation, in 2016, the Government added a 3% supplement in stamp duty on all buy-to-let properties. Then, in 2017, the Government started to reduce mortgage interest by stopping landlords from deducting the interest they paid on their mortgage before paying tax on the rental profits and replacing it with a flat rate tax credit based on 20% of the interest they spent on their mortgage.
There would be no effect if a Bath landlord were a basic rate 20% taxpayer. Yet Bath landlords who were higher-rate (40%) or top-rate taxpayers (45%) saw an effect as their tax relief was cut in half.
The response to this question is much more significant than the issue of taxation.
To a large degree, as with all investments, it depends on why you are investing and what your final objective is. Let me expand.
You can earn money two ways with buy-to-let.
The first is the rental income from the property.
This rent is expressed as a yield and is described as a percentage figure that’s calculated using the annual rental income and dividing it by the value of the buy-to-let property.
Landlords and buy-to-let investors use rental yield to judge and measure the value of their rental investments and portfolios. E.g., rent is £1,000 per calendar month (pcm), which means the annual rent is 12 x £1,000 = £12,000. If the property is worth £180,000, the rental yield is £12,000 divided by £180,000, which, when expressed as a yield percentage, is 6.67%.
Some areas in Bath can achieve a 5.5% to 7% yield, sometimes even more, depending on your choice of property and type of tenancy you wish to have.
If yield is your number one focus, the highest average yield in the UK can be found in Bradford City Centre, where it is 12%, Hyson Green and Radford in Nottingham at 9.6% and Pontypridd at 8.7%, while other areas in the UK can be as low as 2.2%.
So indeed, is the best strategy to go for high-yielding properties?
The problem with pursuing high-yielding Bath buy-to-let properties is that you usually must compromise on the property’s capital growth to attain that high yield.
The second way to earn money with buy-to-let is capital growth as your Bath property increases in value.
A reasonable return in anyone’s books.
Of course, this all depends on the rent coming in, yet you can buy landlord insurance to cover against loss of rental income, tenant damage and legal costs.
Interestingly, using Government data and Industry data, Denton House Research has found that in the first lockdown landlords who managed their rental properties themselves were 272.5% more likely to be in arrears of 2 months or more (compared to those who utilised the services of a letting agent to manage their property).
Your tax bill is higher today than a few years ago, but isn’t everyone’s?
If Bath property prices fall, the capital you invested will reduce, yet if it sat in the bank, it would decline in value anyway.
Being a landlord is a big responsibility, with over 170 pieces of legislation and orders to comply with. That’s where a suitable letting agent can help you with your rental property to ensure you remain compliant.
I recommend Bath landlords consider all options to maximise their rental income whilst reducing their outgoings concerning their rental property.
Rents are rising in Bath (as mentioned above), and many Bath landlords appreciate the demand-led increases in their rent. And let me ask you, why shouldn’t they, as they have been exposed to many legislative and taxation changes over the last five years?
Ok, last point and the elephant in the room.
A house price crash conjures up a big event that makes house prices go down, and it certainly happened like that in 1988 with the removal of dual-MIRAS tax relief on mortgages and the Credit Crunch in 2008. Yet this time, it’s different.
As there is more normality and balance in the Bath property market at the moment (compared to 2021/early 2022), the price that is being paid today on most houses in Bath is not as extreme or as extravagant as what was being paid in 2021/early2022 (when people were outbidding each other).
Therefore, if you were to look at the house price indexes going into the spring and summer of 2023, then there will be a reduction. The doom-mongers and newspaper editors will call that a house price crash, yet I see it as the market easing back to normality.
There is always newspaper (and now social media) attention when house prices explode. This means people quickly feel pressure to enter the ‘property market’, as everyone is making money, yet they aren’t.
The problem is that during the previous boom phases (the late 1980s and early/mid-2000s), house prices increased quicker than some people could save money for their deposit (for a house purchase). They saw their friends and acquaintances snapping up buy-to-let deals and they were missing out on the spoils of house price growth. As a result, many of these excluded house buyers judged that a house price correction was foreseeable, inevitable, and sometimes even needed. Not with any rational economic argument, but classic FOMO (Fear of Missing Out).
‘House price crashes’ virtually never drop house prices to reasonable levels, and in fact, they have a lot of additional effects that make house buying even harder.
Investing in buy-to-let is a long-term investment. Remember what I said at the start. It would help if you decided why you’re getting into buy-to-let investment and when you will get out (and what you want to get out of it). Buy-to-let has advantages and disadvantages, but it is something tangible and something that investors can understand.
The heady days of the early 2000s, when anybody could make money from any property, though, have gone. With increased legislation and taxation, you need the advice of a great agent to guide you on what to buy (and not to buy) for an excellent yield, incredible capital growth or a balance of the two. That agent should be able to find you a great tenant who will pay the rent on time and look after the property to ensure that when they leave, your investment is returned to you in the best condition possible.
If you would like to pick my brain, whether you are considering becoming a landlord in Bath, an existing landlord (irrespective of which agent you use) or even a self-managed landlord, do not hesitate to pick up the phone to me. I will tell you what you need to hear, not necessarily what you want to hear.
or ‘how to avoid a rental property shortage again in 2023’.
In 2022, the shortage of rental properties simply couldn’t satisfy tenant demand, driving up rents to unprecedented levels. How can we avoid this happening again in 2023? Here are 3 good places to start…
With energy prices soaring, rents rising and tenants feeling the pinch, a property’s energy efficiency has become so important that it can affect the rental value and desirability of a property.
The government has set ambitious targets that will require landlords to improve the energy ratings of their rental homes in the near future… so what can Bath landlords do to get ahead of these incoming regulations? What makes a good and bad EPC? And what can landlords do to improve their properties?
We have assembled a panel of expert speakers to discuss this hot topic at our second Bath Landlord Forum event. There will be a chance to put your questions to the panel and speak with fellow landlords.
We have the following speakers:
Oliver Meyer, of Meyer Energy, is a government-approved and accredited Domestic Energy Assessor operating in Bath. He will explain how property EPCs are compiled, and what constitutes a good or bad EPC.
Sonia Pruzinsky, of the Centre for Sustainable Energy, will discuss the options and funding available to landlords who wish to increase the energy efficiency of their property.
Toby Martin, of Reside Bath & ARLA Propertymark, will summarise current and upcoming EPC regulations, and other recent changes to landlord legislation.
We want to help Bath landlords to stay compliant with ever-changing lettings legislation, and provide support to make the most of your property investments.
So join us at The Francis Hotel, Queen Square on Wednesday 15th March 2023 from 18:00.
Places are limited, so booking is vital.
Walcot Street is home to Bath’s Artisan Quarter, a hive of bustling independent shops and businesses. Also featured in this tour of Bath’s most eclectic corner is the story of the tunnel that was supposed to start at Walcot Street and go right under the the city…
