It’s officially December and Christmas is fast approaching. The UK has had an early Christmas present with the COVID-19 vaccine being approved and beginning to be rolled out. This has increased confidence and activity in the market as people begin to see a potential light at the end of the long, hard tunnel that is this pandemic.
Now, let’s take a look at the property headlines that caught our attention this week, I always try to summarise the links to save you having to click through.
Property news this week
- Buy to Let Watch: Digitisation is starting to happen – Digitalisation has been talked about for many years and as we have come to realize, this pandemic has accelerated the speed at which many industries have had to become more digitalized and tech-savvy. Over the years, it is not something we have massively seen in sections of the mortgage process especially in comparison to other sectors across the financial services industry. So is now the time that the mortgage industry is forced to adapt quicker than anticipated? Well, it was always on the cards as we have seen the emergence of challenger banks and digital lenders in recent years. But the pandemic has definitely forced the mortgage industry’s hand and it has been interesting to see how different types of BTL lenders are utilizing tech to meet the demands of borrowers and adapting to the current environment. One way has been the increased reliance on AVM’s (Automated Valuation Model) meaning no need for a physical survey. There has also been a progression in how different data types are electronically transferred and verified. This will improve how lenders and advisers access and analyse relevant information which will lead to a large timesaving. It will be interesting to see how this continues to progress and will surely be beneficial for the industry as a whole moving forward.
- Don’t write off student rental market, warns PropTech platform – Tenants software supplier Bunk conducted a survey of students last month and the results would indicate that the student accommodation rental market remains strong despite the coronavirus. A massive 85% of current students surveyed said that they would return to rent a property in their university town for the next academic year, despite the ongoing pandemic. 4 out 5 students said that even though this university experience isn’t what they had expected, they would still prefer to be enrolled and living at university rather than at home. 78% said their disappointment was with the university rather than their living situation. The PropTech firm says that on the basis of the survey it was “clear” that the student property market would continue to thrive in 2021.
- Couple loses life savings as buyer’s lender withdraws post-contract – This article highlights the potential rare risk to any buyer purchasing a property with a mortgage and can be an even bigger risk where a chain is involved. A Reading couple with a young baby is faced with a bill of at least £33,000 plus ‘damages’ following the collapse of their housing chain after an exchange of contracts – despite having a secure mortgage themselves. Mr & Mrs. Saboor were left devastated when their buyer was told by lender Santander that their mortgage offer was being withdrawn in the period between exchange and completion. It was actually withdrawn on completion day and the Saboors have tried to raise the issue with Santander, but so far have been offered no explanation as to why the bank took the decision to withdraw their buyer’s mortgage offer. It has mostly been the assumption that a mortgage deal in place at the exchange cannot be withdrawn before completion so this case has massive implications for every homebuyer and mortgage broker in the UK and the 1-2 weeks between exchange and completion are now at the mercy of every lender involved in the chain. It would seem that while this is a potential risk, brokers should advise their clients to take extra care, and perhaps try to get contracts worded so that they are not liable if they lose their buyer post-exchange. As scary as this scenario is, just bear in mind that this is a massive rarity, but something still to bear in mind.
- Petitiion Calling for evictions after two weeks’ rent arrears hits 10,000 signatures – Property investor Ranjan Bhattacharya launched the petition in early October calling on the government to enable landlords to start evictions once a tenant falls more than two weeks behind in their rent and it has attracted 10,000 signatures. The government has been under pressure to protect tenants from the threat of being evicted and losing their home during the pandemic but Mr. Bhattacharya wants to see more done to help landlords who could be facing up to two years without rent due to the government’s decision to introduce a six-month eviction ban. Bhattacharya said: “There are laws in place to protect shop keepers large and small. Not paying rent is also theft with the landlord being the victim.
“In Australia, tenants can be evicted for being 14 days in arrears with rent. Let’s have that system here [in the UK].”
He added: “The current system is unfair to landlords.”
I see where he is coming from and we know there has been frustration amongst the industry around this topic but I do not think this is the solution. I keep saying that genuine struggling tenants need protection and help and the same goes for landlords as well.
That is all we have for you this week. If you have any comments or questions on this weeks news summary then please send us an email at [email protected]
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