2025: A Buyer’s Market?

Hi there,

This is Chubby Wallet. The property newsletter that stays plugged in over the weekend so you don't have to

Here's what we’ve got for you today..

✍ Market update: asking prices up by £6K
✍ Mortgage rates & rule changes
 📊 Auction strategies for 2025
✍ Renters reform bill: big changes ahead

Let’s dive in!

Asking Prices Are Up
The UK property market is getting quite interesting in 2025 🎢. Asking prices for homes have gone up by nearly £6,000 in just one month, according to Rightmove, pushing the average property price to £366,189.

That’s the most significant bounce since 2020 which might sound like great news for sellers, but before anyone gets too excited, it’s worth noting that prices are still £9,000 below last May’s peak.

What’s really shaping the market right now is increased supply. A record number of sellers have entered the market since Boxing Day, with new listings up 11% compared to last year.

For buyers, this means more options and more negotiating power. But for sellers, it’s a wake-up call. With so much competition, standing out requires more than just slapping a “For Sale” sign on the lawn.

Realistic pricing, great presentation, and maybe even a few standout features are now essential to catch a buyer’s eye.

As Colleen Babcock from Rightmove puts it:

Looser Mortgage Rules?
The Financial Conduct Authority (FCA) is considering relaxing mortgage rules to help more people buy homes. Currently, a buyer earning £50,000 annually can typically borrow up to £225,000 (4.5 times her salary).

With new rules, she might be able to borrow up to £275,000 (5.5 times her salary). Also, buyer history of consistent rent payments could be considered, potentially increasing borrowing capacity..

On the surface, this sounds like a win for aspiring homeowners, but experts warn it could backfire without a boost in housing supply…

If there are less homes on the market, relaxing lending rules could simply push prices higher, leaving buyers worse off than before..

Speaking of renting… across the UK, they’ve jumped 9% in the past year, hitting an average of £1,327 per month. That’s an extra £110 leaving your wallet every month basically the cost of a Netflix subscription, a gym membership, and a takeaway.

London is, unsurprisingly, leading the pack, with rents rising by 11.5% to £2,220 per month, with Dumfries and Galloway (Scotland) coming in at £499.

In the South East of England, outside London, Elmbridge is the new hotspot, with rents averaging £1,867 per month

The numbers don’t lie:

• England: Rents up 9.1%, averaging £1,334

• Wales: Up 8.0%, now £793

• Scotland: More modest at 6.1%, reaching £987

• Northern Ireland: A solid 8.2% increase

Popular property types for renters
When it comes to renting, detached properties are the kings of the castle, commanding the highest average rent in Great Britain at £1,523 per month. 

On the flip side, flats and maisonettes are the budget-friendly option, averaging £1,296 per month. 

If you’re after space, be prepared to pay up. Four-bedroom-plus homes come with a heavy price tag, averaging £2,013 per month. Meanwhile, one-bedroom properties are the most affordable, with an average rent of £1,067. 

That’s like choosing between a penthouse and a cosy studio—both have their perks, but your wallet will feel the difference. 💸

2024: Year end review
In Auction land, December wrapped up the year with a bit of a mixed bag. According to EIG, more properties were listed at auctions (3,458 lots, up 1.6% YoY), but fewer actually sold (2,407 lots, down 2.7% YoY).

The percentage of properties sold was down to 69.6%, but total revenue still climbed to £475.4 million (+1.6% YoY). Translation? Buyers were picky, but when they liked something, they really liked it.

🌍 Regional rundown: who’s winning?
Last year, the regions showed fascinating results —some thrived, others held steady, and there were well, a few… laggards

• London, North East, and Yorkshire & the Humber: These regions were the life of the party, posting solid gains across the board. London alone raised £301.1 million in Q4! 💰

• East Anglia and the West Midlands: Strong growth in lots sold and revenue, even if sell-through rates dipped a bit.

• East Midlands and Wales: Total revenue soared, proving that even smaller markets can pack a punch.

What drove the market in 2024?
Interest Rate Cuts: Finally, some relief! The gradual rate cuts gave buyers a little more breathing room, though they weren’t exactly throwing money around.

Debt-Driven Sales: Higher borrowing costs forced some sellers to offload properties, creating a steady flow of opportunities.

Regulatory Changes: The 2% stamp duty hike on second homes pushed some investors to sell, but the feared capital gains tax hike never materialized. 😀 

Investor Sentiment: Despite slow growth, investors remained optimistic as there are always good deals to be done at auctions 🏆

What’s selling? the hot list
Renovations: big, homes in commuter belts e.g places like Hove and Hereford

Developments: sites with planning permission, especially in London and the Southeast, were like gold dust.

Investments: Blocks of flats and multi-unit properties kept income-hungry buyers happy.

Care Homes: Former care homes and sheltered housing units offered repositioning opportunities for savvy investors.

🚀 Winning Strategies for 2025
Leverage Data: Use auction platforms’ analytics to spot properties that are ‘undervalued gems’ e.g. where tenants are unknown, properties in an article 4 area, flats doubling as HMOs etc..

Niche down: Master a specific niche, rule or area to spot overlooked opportunities that match your bidding strategy

Unsold Auction Properties: Target unsold auction properties with serious potential where vendors/auctioneers are willing to do a deal

2025 is shaping up to be another year of opportunity to get great deals — if you play your cards right. Interest rates are expected to keep inching down (slowly but surely), and the market for auctions isn’t going anywhere.

UK Rental Market Update: Big Changes Ahead🏠✨ 
The UK rental market is in the spotlight as the government pushes forward with its Renters Reform Bill.

This is a big deal for both landlords and tenants, with some major updates that could shake things up.

Here’s the key stuff you need to know. 👇

Renters Reform Bill: What’s New? 🚨
The bill just cleared the House of Commons on 14 January 2024 and is now making its way through the House of Lords.

Housing Minister Matthew Pennycook introduced a bunch of amendments, and they all passed. 💼 Here’s the lowdown on the key changes:

No More Rent in Advance (Mostly): 🚫💰 Landlords won’t be able to ask for rent in advance anymore, except for the first rent period.

This is a game-changer for international students or tenants without a UK credit history, who often get hit with huge upfront payments… local authorities paying rent upfront for temporary housing will also be affected.

What does this mean? If you’re a landlord, you can’t demand rent before the tenancy starts (except for the first month). If you do, you could face a civil penalty. Ouch. 😬

Student Housing Rules Tightened: 🎓🏡 Landlords renting to students will face new restrictions. If you sign a tenancy more than 6 months before it starts, you won’t be able to use Ground 4A (a new possession ground) to reclaim the property between 1 June and 30 September.

This is a big deal because student tenancies are often signed way in advance—sometimes as early as October for the following academic year.

If you’re a landlord, these changes could feel like a bit of a squeeze with more rules to follow and potential cash flow concerns

So the big question is:

Will Landlords Leave the Market? 🏃‍♂️
Some landlords might decide it’s not worth the stress and sell up. This could reduce the number of rental properties available, which isn’t great news for tenants.

On the flip side, bigger investors might see this as an opportunity to step in. 🤷‍♂️

Good News for Tenants? 🛡️🎉 
The reforms are all about giving tenants more security and fairness. Here’s how they could benefit:

• No More “No-Fault” Evictions: 🚫⚖️ The abolition of Section 21 means landlords can’t evict tenants without a good reason. This is a huge win for renters who’ve been living in fear of sudden eviction.

• Fairer Rent Practices: ⚖️💡 The ban on rent-in-advance demands and tighter rules on tenancy agreements should make renting more affordable and transparent.

What’s Next? 🗓️👀
The bill is heading to the House of Lords for its second reading on 4 February 2024.

Here’s what to watch out for:

• Clarifications Needed: 🤷‍♀️ There’s still some confusion around whether the Bill fully bans rent-in-advance payments. This needs to be cleared up to avoid messy legal battles down the line.

• Potential Tweaks: 🔧 The House of Lords might propose amendments to address landlord concerns. Will the government listen? We’ll have to wait and see...

With rising rents and a shortage of homes, the government is under pressure to make these reforms work without making the rental market even more chaotic.

From Spreadsheets to Skyscrapers: Nick Candy’s Rise 🚀
Nick Candy didn’t start as a real estate mogul—he was an accountant who admits he “wasn’t very good at it.” 😅 

But in 1995, armed with a £6,000 loan from his grandmother, Nick and his brother Christian bought their first flat in Fulham. That modest start sparked a property empire.

Their big break came with One Hyde Park. In 2006, they transformed a £150 million Knightsbridge site into a luxury landmark, selling one flat for £140 million. In 2014. Nick joked:

The secret to their success? Relentless discipline. They scaled strategically, focusing on London’s priciest neighbourhoods and building a brand synonymous with luxury. Nick’s mantra is “Buy, refurbish, repeat.”

Did he face challenges? Yes.

But Nick says:

Today, Nick’s a symbol of property success, turning £6,000 into a billion pound empire. His advice? “If you’re not dreaming big, you’re not dreaming at all.”

That's it for this week folks. Each week we'll cover strategies, updates and insights to help you succeed in real estate. We love this stuff!

If you Have questions or just want to chat, We want to hear it.

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