House prices fall by 0.8%

Hi there,

This is Chubby Wallet. The newsletter that teaches you how to profit from property trends before they go mainstream..

Here's what’s in store..

• General market update

• How to use your home equity for auction purchases

• Renters' rights bill last minute government amendments

• The immigrant transforming Canary Wharf

The property market is swimming in inventory…

Chris Watkin reports 36.7k new listings in Week 25, a slight dip from 37.7k the prior week, but still 5% above 2024’s year-to-date and 7.6% higher than pre-pandemic levels (Property Industry Eye)

Why the glut?

Exiting landlords are quietly flooding the market, a trend Adam Lawrence (Propenomix) calls the “never spoken about” truth.

This oversupply is cooling price growth. Nationwide’s June data shows a 0.8% monthly price drop, dragging annual growth to 2.1% (Nationwide House Price Index).

Adjusted for RPI, house prices are at their cheapest in 22 years—a golden window for buyers.

Are we stuck in neutral?

Not quite. Sales subject to contract (SSTC) hit 27.5k, up 8% year-on-year and 15.6% above 2017-19 levels, showing demand is still healthy despite the stockpile.

Price reductions: bargains or warning signs?

26.7k properties saw price cuts in May, with 14% of listings reduced compared to a 5-year average of 10.6% (Watkin, Property Industry Eye).

That’s a whopping 32% more reductions than normal, or over 100k monthly cuts nationwide.

One in seven properties is getting a haircut

For buyers, this is a chance to snag value, especially in flats, which Nationwide notes are up just 0.3% this year versus 3.6% for terraced homes.

But for sellers, it’s a wake-up call.

With stock levels this high, competition is fierce. Properties need to be priced sharp to move, especially as affordability remains squeezed.

Impact of government policies

Stamp duty changes distorted activity earlier this year, front-loading transactions and skewing borrowing data (£2.1bn net borrowing in May, per Bank of England).

Labour’s balancing of welfare spending and cuts—has markets on edge.

If Chancellor Rachel Reeves loosens the purse strings, expect bond yields to climb, pushing mortgage rates up.

On the other hand, disciplined spending could stabilise rates, giving buyers breathing room.

Demographics

Northern England’s 3.1% price growth outpaces the South’s 2.2%, narrowing the North-South divide (Nationwide).

Younger buyers are flocking to affordable regions, while flats lag due to shifting preferences for space post-pandemic.

Meanwhile, exiting landlords signal a structural shift—rental supply could tighten, pushing rents up and complicating affordability for tenants.

Risks

• Oversupply could keep prices flat through summer, especially if landlords continue their exodus.

• Gilt yield volatility, as seen this week, threatens higher borrowing costs.

• And if inflation (RPI at 3.5% or more) outpaces house price growth (below 3.5% annualized), real-term prices could dip further.

• Political uncertainty—Reeves’ shaky approval ratings and Labour’s internal rifts—adds fuel to the fire.

Opportunities

• Cheaper real-term prices scream “buy low” for long-term investors.

• Net mortgage approvals hit 63k in May, nearing the 65k mark of a robust market (Bank of England).

• Housebuilding activity is finally ticking up, with a PMI of 50.7—the first expansion since September 2024 (S&P Global PMI).

• Government pushes for social housing could ease supply constraints down the line.

• And with fall-through rates at 23.7%, below the 7-year average, transactions are holding firm.

Looking ahead

• Expect a steady summer with muted price growth as supply outweighs demand.

• Keep an eye on gilt yields and Bank of England signals; a rate cut could spark activity later in 2025.

• First-time buyers and investors should consider flats and Northern markets, as a value play

• Sellers? Price competitively and stage your home to stand out in a crowded field.

The market is still healthy and with smart moves, you can ride this wave.

Imagine you've saved up a decent deposit for your first home, and now you've got some serious equity built up.

Now, looking at the property you want to buy:

• Purchase Price (PP): £250,000

• Bridging Loan LTV: 80% (meaning the Bridger will lend 80% of the purchase price)

• End Value (after all costs): £450,000 (that's your Gross Development Value or GDV, minus all project costs)

• Projected Profit: £70,000

Tapping into your home equity with a "Second Charge"

A "second charge" is basically a second mortgage on your home.

Your main mortgage is the "first charge" because it's paid off first if anything goes wrong.

A second charge sits behind that.

How it works

Lenders for a second charge will usually let you borrow up to 60-70% of your home's value, MINUS any existing mortgages.

Let's say your home is worth £500,000 and you have an existing mortgage of £200,000. Your equity is £300,000.

If a second charge lender offers 70% LTV: 70% of £500,000 = £350,000.

Subtract your existing mortgage: £350,000 - £200,000 = £150,000.

So, you could potentially raise £150,000 from a second charge.

Why would you do this?

This money can be used as the deposit or "cash injection" for your £250,000 auction purchase, reducing how much you need to borrow from the Bridger.

It's using your existing asset to fund a new one!

The Renters’ Rights Bill, nearing its final lap in the House of Lords (July 1–15, 2025), is set to reshape private rentals.

With Royal Assent by October 2025 and enforcement likely in 2026, it’s time to prep. Here’s a concise rundown of the key amendments, practical solutions, and market insights to keep you ahead.

1. No More Rent in Advance Change: New tenancies can’t demand rent upfront (e.g., six months). Monthly rent-in-arrears is the new norm. Existing tenancies with advance payments are safe until they end, sparing you paperwork chaos (Government amendment summary).

Solution: Draft new leases for monthly payments. Tenants can voluntarily pay upfront, but don’t mandate it. Use robust referencing or guarantors for risky tenants.

2. Pet Insurance Scrapped Change: Landlords can’t require pet insurance, leaving the five-week deposit cap (Tenant Fees Act 2019) as your only shield. The NRLA calls it a “dog’s dinner,” citing risks of uncovered damage.

Solution: Add a reasonable “pet rent” surcharge or lean on detailed inventories and frequent inspections. Register deposits with approved schemes.

3. Rent Increases: Rent hikes via Section 13 need two months’ notice. Tenants can challenge at the First-Tier Tribunal, delaying increases until a ruling. A new amendment lets Angela Rayner allow backdating to the notice date, curbing frivolous appeals (Government amendment summary).

Solution: Use Section 13 properly—give clear notice and justify hikes with local data (Zoopla/Rightmove). Stay transparent to avoid disputes.

4. Joint Tenancies: All joint tenants must agree to shorten notice periods or withdraw termination notices, preventing rogue exits.

Solution: Update joint tenancy agreements to reflect this. Regular tenant check-ins spot issues early.

5. Student Accommodation: PBSA Perks Change: Purpose-Built Student Accommodation (PBSA) managed by universities or approved providers (ANUK/Unipol) is exempt. Smaller landlords stay under the Bill’s rules unless they scale up (15+ beds), per David Smith, housing solicitor.

Solution: Small student landlords should join approved codes or align with periodic tenancy rules and Ground 4A for academic-year evictions.

6. Council Crackdowns: Local authorities can inspect without notice if landlords aren’t registered or are suspected of breaches (e.g., illegal evictions). Compliance is critical with the new Private Rented Sector Database.

Solution: Register on the database ASAP. Keep licences, safety certificates, and records spotless.

Why It Matters: A regulated market boosts tenant trust, driving demand (The Independent Landlord). Compliant landlords stand out.

Risk/Opportunity: Rogue landlords risk £7,000 fines. Staying compliant attracts quality tenants in a market with 63k net mortgage approvals (Bank of England, May 2025).

Action plan

• Upgrade Properties: Meet Decent Homes Standard and Awaab’s Law (mould fixes) to stay compliant.

• Leverage Pros: Join the Private Rented Sector Ombudsman for quick dispute resolution.

• Stay Informed: Monitor Angela Rayner’s regulatory moves

Shobi Khan wasn’t born with a silver blueprint. Raised in Baltimore by Kashmiri immigrants, he studied at UC Berkeley and got an MBA from USC,

Khan jumped into property at Equity Office Properties in the ‘90s, and found a new home in real estate where data met dollars.

The Game-Changer

A $43 Billion Deal Khan’s star moment hit at General Growth Properties (GGP).

In 2018, he masterminded a $43 billion sale to Brookfield—one of history’s biggest real estate deals.

Like a pro, he navigated bankruptcy, rebranded malls as lifestyle hubs, and cashed out big.

This coup didn’t just boost his cred—it got him to CEO of Canary Wharf Group (CWG) in 2019, tasked with reviving a financial icon.

Scaling smart: Canary Wharf 3.0

Facing remote work and rival London districts, he’s crafting “Canary Wharf 3.0”—a 24/7 mixed-use marvel.

His £4 billion pipeline spans 8 million square feet: residential towers for young pros and families, Europe’s largest commercial lab for biotech, and a government hub for 6,000 civil servants.

Retail, restaurants, and green spaces make it a destination, not just a desk farm. Khan’s discipline—data-driven and deadline-obsessed—keeps CWG nimble in a volatile market.

Conquering challenges

Khan faced a post-Brexit, post-COVID storm: empty offices, slumping footfall, and 4.7% interest rates pinching loans (Bank of England, 2025).

Khan fought back, luring biotech and government tenants to cut reliance on banks. His outsider edge—unlike CWG’s insider old guard—let him rethink the Wharf as a sustainable, livable hub.

Lessons for dreamers

• Khan’s playbook is gold for go-getters:

• Pivot fearlessly—science skills rocked real estate.

• Bet big—his GGP deal was risky but epic.

• Use pressure—tight deadlines spark innovation.

• Diversify—mixing tenants keeps cash flowing.

• Stay human—green spaces show it’s about people, not just profit.

Canary Wharf’s Future

A Global Star Khan’s vision is bold: Canary Wharf as a thriving, mixed-use beacon. With 8 million square feet of projects, it’s set to draw biotech firms, residents, and diners.

Shobi Khan proves you don’t need a real estate dynasty to reshape skylines.

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.

See you next time in your inbox!

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