£5m interest accrued on tenant deposits in England and Wales

Pricewaterhouse Cooper claims there will be a rush to sell property

Hotels in the UK are most expensive in Europe

More people using bridging loans

Knight Frank says deals can still be done in this challenging climate

£5m interest accrued on tenant deposits in England and Wales

Thousands of tenants in England and Wales will be better off by just under £5m when their protected tenancies come to an end, according to the Deposit Protection Service (DPS). This is thanks to the interest accrued.

Since 6 April 2007, every deposit-taking landlord and letting agent in England has to use one of two tenancy deposit protection methods, a custodial or insurance-based scheme, for any new or updated assured shorthold tenancy (AST).

The DPS works by holding a tenant’s deposit, free of charge, for the term of the tenancy agreement. At the end of the rental period, the deposit, and a portion of the interest it has accumulated, is paid back to whoever is entitled to it – tenant or landlord, depending on the condition of the property and the terms of the rental agreement. The remaining interest is used to fund the service.

Pricewaterhouse Cooper claims there will be a rush to sell property

Pricewaterhouse Cooper claims there will be a rush to sell property when the reduced capital gains tax rate of 18% comes into effect but this has been dismissed as ‘unlikely’ by The Money Centre.

Lynsey Sweales, marketing and PR director of The Money Centre, said: “Our most recent research among buy-to-let landlords shows that the majority regard their investment as a medium to long term strategy. Around 22% of those interviewed anticipated holding on to their properties for between 11 and 20 years with a further 19% intending to stay in the market for anything from six to ten years.

“Only 13% of landlords said they were likely to sell any letting property in this current quarter and so, while the reduced capital gains tax rate will definitely benefit investors eventually, I think a rush to cash in next month is unlikely given most landlords are committed to a longer term strategy.”

Hotels in the UK are most expensive in Europe

Hotels in the UK are the most expensive in Europe, costing on average £106 per night, according to figures published by Hotels.com.

Prices rose 12% last year, outstripping inflation and making England the only country in the continent to average more than £100 a night.

Bath ranks as the UK’s most expensive city to visit, with an average of £117 per night.

London was ranked second at £115 per night and Oxford was third at £113 per night. Surprisingly, Birmingham, England’s second largest city, came in at 19 th with a cost of just £79 per night. The UK actually defied world trends as hotel room prices across the globe dropped by 0.4%.

David Roche of Hotels.com said: “Whilst Bath’s combination of high visitor levels and luxury hotels means that it retains its place as the most expensive city in the UK, our data showed that Oxford and London are catching up fast.

“In the past, limited supply has made for an expensive night’s stay in the university city, and although a number of new hotels have been developed, these higher star rating properties have kept the average price growing along with interest from visitors. The increase in London rates continues a trend we’ve seen over the last four years, and reflects both rising visitor numbers and rising property prices in the capital.”

More people using bridging loans

According to Bridging Finance Limited, last minute snags and delays on residential property deals are driving an increase in the number of homebuyers using bridging loans.

Experts have reported a rise in the number of homeowners using short term finance to break lengthy chains caused by last minute demands from purchasers holding up the process. The Royal Institution of Chartered Surveyors (RICS) said that the stock of unsold property on estate agents’ books jumped more than 8% in February – a fifth successive monthly rise – reflecting declining sales and waning interest from new buyers.

Talk of a downturn in the housing market means buyers are driving a harder bargain and demanding last minute reductions and additional items to be included in the price.

Chris Baguley, managing director of Bridging Finance Limited, said: “The number of people who have already found their dream property but are getting held up by the sale of their existing home is soaring. Last minute snags mean that estate agents and buyers are turning to short term funding providers to ensure their deal completes quickly and they don’t lose their dream property.

“The growing trend for buying at auction is also having an impact. Many high street banks simply can’t turn the funds around quickly enough to enable people to snap up a bargain at a property auction.”

Knight Frank says deals can still be done in this challenging climate

A London-based institution has sold a well-located Leeds industrial unit for £1.16m.

Prumip has sold the 25,517 sq ft industrial building at West End Approach, Morley, to a private purchaser. The deal represented a capital value of £45 sq ft and a net initial yield of 7.95%.

Rebecca Farnsworth of property consultancy Knight Frank’s Leeds office advised Prupim throughout the sale. She said: “This transaction proved that deals can be done in this challenging climate if the product is priced correctly and suited to current requirements. This sale generated strong interest.”