CategoriesWeekly News

Welcome to the latest weekly news insight from Track Capital. 

This week we have seen an influx of both UK and overseas motivated property investors, It seems that confidence is creeping back into the UK property market and people are looking to take advantage of attractive deals before the market goes back into full swing leading to vendors being less flexible with discounts and incentives, see an example here

We can say for sure, speaking to property developers every day, that there were no significant price drops during the lockdown period (other than one scheme in Manchester which is currently discounted by 15-20%, see here) and we are not expecting discounts anytime soon. The bigger developers are leading the way, see a senior executive here explain how developers will hold their pricing. 

One of the more interesting reports that came out a few days ago was the indication that the UK government are proposing first-time buyers and key workers get a 30% discount on new homes in their proposed scheme. This could mean an average savings of nearly £100,000.

So let’s take a look at the other media headlines that we have found insightful this week, we always try to summarise the links to save you having to click through. 

Property news this week

  • Interest rate cut means mortgage costs have fallen for landlords – The cut in interest rates by the bank of England has begun to be passed on by mortgage companies and we are now seeing lower rates being offered to landlords, on both shorter and longer terms. It is reported that the average 2 year fixed rate mortgage for May has dropped from 3.02% to 2.51% year on year saving an average of £63 a month or £756 a year. With 5 year fixed mortgages having dropped from 3.53% to 2.94% giving an average monthly saving of £74 or £888 a year. Now is definitely a great opportunity to lock in some great rates for at least 2 years and reap the benefits.
  • Demand for rental property increases by a third – Rightmove has seen an increase of 33% in demand for rental properties in comparison to this time last year with Monday 18th May recording the highest level of demand ever recorded in one day on the property portal. Rental stock has increased 13% since lockdown and asking rents are up 2.1%. These numbers show the determination of home-movers, landlords and the pent up demand accumulated during the lockdown. It is only a week’s worth of data so not a guarantee for what the market is going to go on to do over the long term, but it is definitely a positive start.
  • 86% of construction sites now open across England and Wales – This article is really positive news for the construction industry and shows that things are hopefully moving in the right direction. It reports that contractor members are beginning to bring staff back to work with the percentage of furloughed staff down from 30% to 22%. With construction sites back on track and homes being built again, this will help stop seeing an even bigger strain on supply.
  • UK house prices were on an upward trajectory before coronavirus hit – Before lockdown brought a standstill to the property market, prices were on the up with London soaring 4.7% which is the largest 12-month growth since December 2016. The UK average rose by 2.1%. A lot of this increase would have been the ‘Boris bounce’ that we were seeing which really saw the market take off. This data is interesting to see but the most intriguing part will now be what prices look to do post lockdown especially as Rightmove has reported a 90% decrease in properties coming to the market on the same period a year ago. Good demand with little supply could see prices hold out, time will tell.

That’s it for this week’s news, keep an eye out for weekly updates.

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