Not for the first time am I saying here that: ‘a week is a long time in politics’, but in this case it’s a month I am referring to and in the four weeks since we published our May edition, Rishi Sunak has called an unexpected general election for the 4th July.
Unsurprisingly, we devote a good few pages in this edition to reflect on the consequences of this decision and its potential impact for the property market, for the private rental sector, development, land and planning. A notable casualty is of course the abandonment of the Renters Reform Bill, which included the controversial section-21 eviction notices. Whichever party gets into power, this will only be for a relatively short period, as the political tide is strongly in favour of the abolition of section-21..
As we go to print, Hometrack/Zoopla have just published a report on the UK’s rental market and it highlights a continuation of demand strongly ahead of rental supply. On new lets, they report that annual rents are up 6.6% with enquiries to rent 100% up on pre-pandemic levels. Interestingly, they also quote the stock of rented property at 5.4m homes, which is where it was back in 2016. Given the substantial increase in the UK population in the last eight years, many of whom are initially renting property, the consequences are entirely obvious.
The ongoing saga, which an election is unlikely to change much, based on the trends of the last 40 years, as Paul Higgs refers to in his excellent and insightful piece on page 47, is the challenges presented by our planning system. Until we see politicians stop chasing the NIMBY voters, the ongoing ‘dogs breakfast’ with developers not achieving quick planning consents, is unlikely to change much whatever the pre-election rhetoric.
Permitted development has become a de-facto choice for many portfolio landlords and SME developers in the last ten years and on page 22, David Kemp our regular contributor on planning and development, summarises what can currently be achieved.
This month’s investor interview on page 19, features two partners who have achieved quite a lot in the last six years in growing their portfolio. In the article you can read about how they have done this and it is also notable why they have changed their strategy in the last year or so. They are not alone in finding the stacking of deals to be more challenging at present with the need to make the numbers work when relying on angel
investor financing.
One of the key reasons the above is the case is of course the current cost of mortgage debt finance and on page 26, Adam Lawrence offers his latest thoughts on inflation and potential interest rate changes this year, as well as commentary about the choices ahead for whichever political party wins the
upcoming election.
In a month’s time we will very likely have a new government, and a lot more to ponder over, so until then...
