RICS: buyers and tenants don’t have the energy to care about insulation

Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, comments on RICS Residential Market Survey for October, which shows buyers and tenants don’t have the energy to care about insulation.

Sarah Coles said:

“Buyers and tenants don’t have the energy to care about energy efficiency. Right now, it’s hard enough to find somewhere they want to live, let alone somewhere that’s cheap to heat.

“A third of agents said they’d seen a slight increase in demand for energy efficient homes, but 54% still said it made very little difference to the selling price and another 23% said it made no difference at all. The agents’ comments highlighted that some had never had this conversation with buyers or tenants, for whom it’s not even on their radar when they’re house hunting.

“Buyers have a difficult enough job finding somewhere affordable and attractive. Seller instructions dropped for the seventh month in a row, and the average number of properties on estate agents’ books fell from 42 in March to 37. 

“As a result, there was another small dip in the number of sales agreed in October, which has been falling ever since the bulk of the stamp duty became payable again at the end of June. Those properties that do sell are going for higher prices. It means that yet again, buyers have the worst of all worlds, paying through the nose for a property that’s not quite right.“

Tenants

“For renters, things aren’t much better. Tenant demand rose again, and has been rising for a year and a half now. It’s being pushed up by the fact household groups tend to be smaller now, so they need more properties to live in. Some have also bought property during the boom earlier this year, and are looking for a place to rent while they do work on their new home.

“Meanwhile, the number of landlords advertising their properties dropped yet again. As a result, agents expect rents to keep rising. Rent already absorbs over a third of the income of renters, and with their prices rising on all sides, a rent hike is the last thing they need.

“Agents mentioned the fact that landlords are being put off by the additional costs involved in letting property, while others are selling up to cash in on higher prices and some have switched to Airbnb and holiday lets. Meanwhile, those who want to let out a property but need to work on it first are coming up against the shortage of tradespeople and materials.

“The mismatch between tenants and landlords mean landlords are getting very picky about who they rent to, so students or anyone without a perfect credit record and excellent references, are finding it increasingly difficult to find somewhere to live.”

Kindly shared by Hargreaves Lansdown

Main photo courtesy of Pixabay