Greetings Humans of Landlord Broadband,
Our quarterly newsletter aims to keep you updated on what we have been getting up to, and what has been moving and shaking in the industry. We hope that you find this edition informative and a useful check-in. We look forward to hearing from you in the future!
What is Happening in our Industry?
A break-down of the latest quarter in the property industry, by virtue of technological, legal and financial analysis.
This quarter, as the new year begins, there has been lots of end-of year reports coming out with some very interesting information. COVID-19 has led to the extensive use and innovation of technology in the real estate sector. MetaProp’s PropTech Confidence Index 2020 states 94% of investors believe COVID-19 “will further accelerate the adoption of PropTech in the real estate industry”. With increased investor interest in the sector, real estate could see further innovation and growth in the future. According to Property Week’s 2020 Power of PropTech survey, there could be a huge increase in remote working post-COVID as 82% of real estate companies are searching for remote working and digital tools to invest in. Remote working allows for increased productivity, money saving (especially on travel) and better inclusivity. This is likely to result in the internet and remote working becoming essential for everyday life even post-COVID.
While every new year brings with it changes to taxation and legislation, this year we can expect an increase in such changes, due to COVID safety regulations and legislation updates. To help navigate these changes, Hamilton Fraser have released a useful guide of key legislative dates in 2021 (particularly relevant to landlords), addressing subjects such as Brexit, evictions and taxation.
Staying aware of and up to date with the COVID regulations for businesses is of course, as important as ever. Luckily, it is business as usual here at Landlord Broadband – we are still able to complete bespoke Wi-Fi installations, in line with our COVID-19 Secure Operating Policy.
Since 2020, the finance world has been busier than ever with the stamp duty holiday being extended until 30th June. As of March 2021, average house price growth has slowed to 5.7%, which reflects the original stamp duty holiday coming to an end and this is not expected to be a sustained dip in prices. In February, growth was on the rise at 6.9%, which is a trend that will hopefully carry through to the rest of 2021. In comparison to other sectors, property prices have remained stable throughout the pandemic, largely due to the Government’s measures to keep the market afloat, and people reassessing their housing needs during lockdowns. However, the slight decline in price growth could be a positive thing for those wanting to get on the property ladder. (Property Reporter).
Rent is also falling as many tenants move from the cities to larger homes in commuter areas. This again comes with the long-term impact of the pandemic and the growing need for space within homes. Rents have fallen significantly in both London and Birmingham, as well as Manchester, Edinburgh and Aberdeen. Contrary to the cities, rents have risen in outer-city boroughs. Perhaps now is the time to invest in the country? (Financial Times).
What is Happening in Our Customer Markets?
The latest updates for our core customer markets: Landlords & Letting Agents, Serviced Accommodation, Housing Associations and Purpose-Built Student Accommodation (PBSA).
Landlords & Letting Agents
Despite COVID-19, volatile economic conditions, and rising unemployment, all of which have impacted the income of tenants across the nation; tenant demand reached a five-year high during the final quarter of 2020 – a trend that Paragon Bank has predicted to continue. 32% reported increasing levels of demand during the final 3 months of 2020, the highest level since Q1 2016 and up 25% from the same period in 2019. A major boost to landlord confidence, however, research suggests regional differences in this demand: 58% in the South West reported growth in tenant demand compared to just 10% in central London (LandlordZONE).
Furthermore, reported high levels of tenancy renewals mean that high-quality rental property is at a premium in desirable markets (LandlordZONE). Overall, although the private rented sector (PRS) has had its fair share of challenges this quarter, tenant demand has been an underlying strength and provides optimism for the future.
This quarter, on the 12th April 2021, the UK government restrictions on overnight leisure stays in “self-contained accommodation” were updated; such stays were permitted on the basis that, all facilities are “restricted to exclusive use of a single household/support bubble” (Gov.uk). Click here, to read the government’s guidance for people who work in or run hotels and other guest accommodation, in full.
As such lockdown restrictions ease, firms say Britons are keen to holiday at home – great news for UK-based serviced accommodation operators! Holiday cottage booking companies reported huge demand influxes from people hoping to book holidays in England when lockdown restrictions were eased from April 12th (The Guardian). Locations in highest demand are reportedly: The South-West and “traditional honeypot locations” – notably, Cornwall and Devon (The Guardian).
The government has set the goal of decarbonising the UK housing stock by 2050 by improving the energy-efficiency of homes. In late March, the Environmental Audit Committee (EAC) reported that the reduction of emissions in the sector has stalled. EAC recommended various funding schemes, but with the Green Homes Grant being scrapped and little direction being given, its hard to know where to turn to. Furthermore, retrofitting homes to be energy-efficient has brought up various issues. The RICS’s paper on Retrofitting to decarbonise UK existing housing stock states that the “lack of a Government policy roadmap providing clarity and certainty on the route to a net zero 2050” is the cause of the issues. Without clear guidelines and proper funding, it’s hard to say whether or not the decarbonisation of the UK housing stock will actually happen by 2050.
In other news, the Secretary of State for Housing, Robert Jenrick recently dictated the importance of increasing social and affordable housing at this time, especially in rural areas. There has been a demand for more funding for social and affordable housing since the start of the pandemic, but there has not been an increase since the initial agreement of £11.5 billion for the Affordable Homes Programme (Gov.uk).
Purpose-Built Student Accommodation (PBSA)
It’s good news for the PBSA sector for the beginning of 2021, as the market seems resilient despite challenges raised by COVID. Despite a nationwide 5% drop in revenues, PBSA seems to be having a significant rise in cities such as Birmingham and Durham. A survey from Unite Students and Opinium found that 93% of students wanted to return to their student accommodation from January, rather than stay at home. Of course, students need reliable Wi-Fi now more than ever, with online learning set to continue for many until at least of the 2020/2021 academic year (Property Investor Today). It also seems that the sector has remained resilient despite implications for EU students caused by Brexit. It is believed that any scarcity in EU students that may have otherwise studied in the UK will be made up for by students from other countries, as the UK’s popularity with students shows no decline. (PropertyWeek)
Co-Living is also on the rise as young renters seek company within their accommodation, as well as in many cases, an all-inclusive monthly bill to pay. As well as convenience, many co-living accommodation providers offer amenities such as free Wi-Fi and communal spaces; near essential for those that work from home. Though in 2020, BTR completions declined, due to pandemic-related complications, the BTR market has grown by 23%: positive news for both investors and renters alike! (Property Investor Today).
Meet the Team at Landlord Broadband – Ft. Ayeisha Thompson
Meet Landlord Broadband’s newest team member Ayeisha Thompson: “Hey, I’m Ayeisha, a student at the University of York currently studying BSc Marketing. I am a new member of the marketing team working as a part-time marketing assistant in the Housing Association sector of the company. Working at Landlord Broadband has allowed me to develop my digital marketing and research capabilities, in addition to my interest in the field. I am very excited to see what my future holds. Though I do have a passion for learning and studying, in my free time I enjoy fashion, fiction and terrible films.”
Fun Fact: Wi-Fi could be older than you are! The group that developed IEEE 802.11, later marketed as Wi-Fi, met up to discuss the shape of the invention in September 1990 – That’s over 30 years ago! (Airtame).
That’s it from us, we hope that you enjoyed our newsletter,
Landlord Broadband (the champions of Wi-Fi friendly accommodation).