Zoopla says a buy to let property sold off by a landlord is “typically priced 25 per cent lower than the wider housing market.”
In a market snapshot the property portal say that landlords are being squeezed by higher mortgage rates, and that as a result mortgaged buy to let units make up around 8.0 per cent of property sales in the UK.
But it warns that BTL investors in southern England now need to have equity of 40 to 50 per cent of the property’s value to get the numbers to stack up and as a result, it forecasts that new investments will be lower this year.
And the snapshot says: “With more landlords selling previously rented homes, there is more supply of homes that appeal to first-time buyers. These are typically priced 25 per cent lower than the wider housing market.”
The portal recently revealed that the sales market in 2023 was likely to be the quietest for over a decade with transactions set to be 21 per cent below the 2022 level.
Over the end of the summer demand for homes was running 34 per cent lower than the five year average, while sales agreed were down 20 per cent; meanwhile supply was rising with listings up 16 per cent.
Based on trends during the first half of the year, Zoopla predicts that cash sales will fall just 1.0 per cent this year while the number of mortgaged sales is projected to be a whopping 28 per cent lower.
Zoopla’s research executive director, Richard Donnell, says: “House price growth has slowed rapidly over the last year as demand weakens in the face of higher mortgage rates. Prices are falling more in southern England where higher mortgage rates have priced more people out of the housing market, weakening demand.
“While UK house prices are 0.1 per cent higher over the year, it is the number of sales that have been hit hardest by higher borrowing costs, especially amongst mortgage reliant buyers.
“Cash buyers are more immune and on track to account for more than one in three sales in 2023. Mortgage rates have started to fall slowly but rates need to fall below 5.0 per cent before we see an increased appetite to move home in the second half of 2023.”
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Utter nonsense 😂 properties like mine who have recently been up for sale by a landlord I know sold for the market rate 💰💰 A first time buyer cares not a job if the vendor is a landlord, as long as the place is in good order and in the right area. 💵💵
Despite the clickbaity title, this appears to suggest that rental properties are on average smaller / less desirable than the wider housing stock, and therefore - logically - sell for less than the average national sale price. It does not mean they are sold under market value. Somewhat misleading, and pretty much unnewsworthy.
Tosh of the first order
You would have to be really desperate to sell 25% below the market, so I agree a nonsensical article.
Excellent example of how most people really don't understand how statistics work.
Most properties sell for less than the average price because the market is skewed by a few million pound sales.
Similarly most people earn less than the national average wage because of how the huge wages of the very highest earners skew the figures.
This is being exploited by the SNP who give very low earners a 19% income tax rate on the first £2000 of taxable income, saving them a maximum of £20. However a Scottish income tax payer earning £50k pays around £1500 more income tax than someone in the rest of the UK.
Since there are more lower earners and benefit claimants than £50k plus earners in Scotland, the SNP have a built in majority of Pauls benefitting from the robbery of a smaller number of Peters.
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