News

Above:Should more landlords and investors purchase fully managed property investments for a high-returning, hassle-free investment?

Summary:

• Over 85% of investors admit that they don’t want to deal with tenants in their properties, while almost 90% feel aggrieved by tenants sending them communications regarding problems
• Maintenance costs and repairs continue to be one the greatest areas of concerns for investors
• Should more turn to a fully managed property investment?

Over 85% of investors admit that they don’t want to deal with tenants in their properties, while almost 90% feel aggrieved by tenants sending them communications regarding problems

Maintenance costs and repairs continue to be one the greatest areas of concerns for investors

Should more turn to a fully managed property investment?

More UK property investors and landlords don’t want to deal with their tenants. So should more of them consider a fully managed property investment?

Over 85% of landlords admit that they’d rather a letting agent deal with the tenants in their properties, according to a new study by PropertyLetByUs. In addition, almost 90% revealed that they are unhappy with tenants calling or emailing them with problems related to the property.

Tenanting and maintaining a property is one of the biggest considerations investors face before making a buy-to-let investment. 60% of property owners in the study pay for all repairs to their asset, while 10% believe that tenants should pay for small repairs themselves, highlighting that there is also confusion when it comes to this aspect of the investment.

Commenting on the findings, Jane Morris, Managing Director of Property Let By Us, said: “We know from our research that 66% of landlords find managing their properties more stressful than their full, or part-time jobs and dealing with tenant complaints is a top cause of stress. Landlords are under a huge amount of pressure with mounting legislative and tax changes.”

Fully managed property investments remove many of these traditional stresses, and are commonly popular among overseas investors and over 55s.

A management company run by the property developer will take care of all issues relating to tenancies and maintenance, and deliver returns NET of all costs.

Source: Select Property

Above:The Manchester property market is set to be one of the UK’s most lucrative over the coming years.

Summary:

• City centre property assets in Manchester set for 26% price growth
• Rental prices in Manchester are also set to rise 9% next year
• The Manchester property market is beginning to attract the kind of international buyer that has so far only operated in London

City centre Manchester property investments are set to appreciate 26% over the next four years.

This forecast was made by property consultancy Jones Lang LaSalle at a Residential Predictions breakfast seminar this week, which outlined that the city’s prime two-bed apartments will grow in value from £280,000 to be worth £354,000 by 2019.

Manchester is now the UK’s second city and unique among the UK’s regional markets. There is a dramatic short supply of homes, with only half of the city centre properties that are needed to meet demand in the pipeline and this shortfall is instigating a new market cycle.

Both rental values and capital growth can be expected in the next few years. Rents currently average £975, but are predicted to rise by 9% in 2015 and 26.3% overall by 2019.

Consequently, Manchester is now attracting the kind of international property investor that has traditionally only operated within the London market.

Stephen Hogg, Lead Director of Residential at JLL in Manchester, explained: “The market in Manchester is indicative of its position as the second city and, along with Birmingham, is seeing flocks of new occupiers who have been priced out of London looking for homes.”

He added that the level of growth is sensible and there is now an opportunity to capitalise on the shortfall driven by the increased occupier demand.

Recent research by Hometrack found that the rate of property price growth is accelerating in northern cities such as Sheffield, Manchester, Liverpool, and Newcastle, while it is slowing in southern cities such as London, Oxford, Cambridge, Bristol and Bournemouth, after it reached an affordability ceiling.

Source: Select Property

About:The property investment potential of Manchester has been highlighted by four huge deals from Singapore

Summary:

• Singapore-based property group makes first European investment in Manchester
• Manchester is widely regarded as the city offering investors the strongest future growth potential
• Many Southeast Asian investors are looking to avoid the worst of the Black Monday fallout by diversifying into the UK

Singapore-based Rowsley Ltd is making four huge property investments in Manchester.

The city has been widely viewed as the UK location offering the strongest potential returns in the future.

HSBC has highlighted the unsurpassed supply and demand dynamics of the property market, while earlier this summer Prime Minister David Cameron flew to the Far East to tell Asia Pacific investors about the UK government’s plans for the £7 billion Northern Powerhouse project – centred on Manchester.

Rowsley’s investments will total £69.1 million (S$150 million) in all and will be spread across the city’s high-performing real estate and hospitality sectors.

Chief Executive of the Group Lock Wai Han said: “This will be Rowsley’s first investment in Europe and comes at a time when the UK government is encouraging businesses to move north to escape the rising cost of operating in London. During a recent visit to Singapore, Prime Minister David Cameron urged Singapore companies to consider the Northern Powerhouse, including Manchester, which he said was ‘brimming with infrastructure opportunities’.”

As well as the high investment returns on offer, the relatively stability offered by UK property has long been one of the major reasons international investors choose to diversify there.

This shift from Southeast Asia to the UK has been accelerated by the volatility affecting the region after the Chinese equities crisis. Following Black Monday, Shanghai stocks have seen 22% of their value erased in just four days of trading and this is set to further hamper investor confidence in the region’s property markets.

Source: Select Property

Above:Having witnessed major economic expansion and population growth over the recent years, Manchester has seen unprecedented demand driving capital returns

Summary:

• 24% of Select Property investors are from the GCC, with 18% from the UAE
• 42 of the 260 units at the new Manchester CitySuites scheme were sold to GCC investors
• Manchester is attracting world-leading organisations with 80 of the FTSEs 100 companies having representation

Select Property, a regional and global developer, retailer and operator of market-leading property investment brands, has seen a notable increase in GCC investment since the launch of its new CitySuites luxury service apartment scheme in Manchester. 24% of Select Property investors hail from the GCC, while 18% are from the United Arab Emirates.

Select Property identified Manchester for its new project, as it is has become the powerhouse of the north and internationally recognised as the UK’s second city for investment. Having witnessed major economic expansion and population growth over the recent years, Manchester has seen unprecedented demand driving capital returns nearly twice as high as those found in London in 2013 and almost three times the national average. Home to the UK’s largest concentration of commercial and retail floor space outside London, Manchester is attracting and retaining world-leading organisations with an estimated 80 of the FTSEs 100 companies having representation, as well as more than 50 international banks and 600 major overseas companies.

The new CitySuites concept in rented living is targeted at business executives working on short-term contracts, and young professionals who want luxury touches and amenities of a hotel with their own space and privacy. As with all Select Property brands, it is the commitment and focus on the end users and their accommodation preferences and requirements, which ensures high occupancy levels, making it a credible and high-performing investment.

Select Property have what they call ‘lifecycle control’, whereby they not only develop and sell the properties, but manage them too, controlling the entire lifecycle of the investment. Due to this A to Z offering, GCC investors living over 5,500 km away have shown strong interest. The new concept of rented living in Manchester saw 16% of sales go to GCC investors, who in less than four months have purchased 42 out of the 260 units. The UAE investors were the most numerous, accounting for 30% of the GCC sales, 24% originating from Saudi Arabia and almost 20% from Qatar.

Adam Price, Global Sales Director at Select Property Dubai, comments: “London has typically always attracted GCC investment due to being a property safe haven, but our savvy investors are now beginning to look to cities further north, which are offering even greater returns on investments. Launching in Manchester, CitySuites apartments are available for rent for as little as one month, bringing a whole new approach to the idea of renting. We always have the end user in mind, and have recognised a huge undersupply of property in Manchester that is available on short and long-term contracts, and CitySuites is bridging that gap in the market.”

The 17 storey striking building occupies a highly desirable location with the £400 million multi-use Greengate Embankment development in central Manchester. Neighbours include Harvey Nichols, Louis Vuitton and Selfridges, as well as Manchester’s major social hubs and thriving business direct.

Source: Select Property

About:As year-on-year rental yields growth at a faster pace, the UK property market’s supply-demand gap is assuring further growth in the future.

Summary:

• The pace of UK property rental yield rises continues to increase
• A growing gap between the supply of quality rental accommodation and the demand for the property will contribute to future increases in both values and yields
• Yields and demand for rental accommodation are strongest in the regional cities of the UK

The average property investment yield in the UK reached £937 per month in July.

A significant shortage of suitable rental property is contributing to rising rents, with Countrywide’s figures highlighting a year-on-year increase of 4.6% last month – up from 3.8% in June.

Some of the strongest yield rises were found in Scotland (4.5%) and the east of England (4.3%), while London remains the most expensive place to rent in the UK.

Tenants are now asked to pay an average £2,583 a month in central London and politicians are calling for New York-style controls on landlords.

Consequently, regional cities such as Manchester and Glasgow are offering property investors stronger future growth prospects, combining lower property prices higher yields and growing demand.

The nationwide growth of the sector has meant that many landlords and investors have retained their assets for longer, which has had the effect of further restricting supply in the housing market. Countrywide estimated up to an extra 100,000 property sales may have been finalised if the private rented sector had not experienced its strong growth in returns.

Yields are predicted to increase further in the future.

Above:The market conditions have prompted surveyors to forecast both significant property price and rental rises in the coming 12 months.

Recently, the Royal Institution of Chartered Surveyors revealed the supply of new properties has fallen for six months in a row, while the amount of buyer inquiries has risen for four consecutive months. The market conditions have prompted surveyors to forecast both significant property price and rental rises in the coming 12 months.

Source: Select Property