Welcome to our Summer Newsletter 2024

Landlord Broadband welcomes you to the latest edition of our quarterly newsletter. We hope that you enjoy it. If the latest industry news, customer market updates, and new content interests you, then read on. Want more? You can check out our previous newsletter here.

Latest News

We are thrilled to sponsor the Best Co-Living Award at Blue Bricks Property Awards 2024, highlighting our support for innovative community living spaces.

We are honoured to be nominated for Service Provider of the Year at the at the Blue Bricks Awards 2024. Thank you for the recognition!

We are also excited to have become a member of ISPA (Internet Service Provider Association)

Industry News

Legal

On 22 May, Prime Minister, Rishi Sunak MP, announced that a general election (GE) will take place on 4 July. Parliament ended before the Renters (Reform) Bill could complete its passage, meaning it will not become law. It will now be up to the next Government to decide what shape reform of the private rented sector will take. For more information click here.

Finance

The Bank of England’s monetary policy continues to hold its base rate for the 6th time in a row as expected.  Emma Wall, head of investment research and analysis at Hargreaves Lansdown, says “rate cuts will be coming in the UK, and in Europe, within the next couple of months”. The Swedish national bank recently cut its rates suggesting that there will be a change in this country in the summer. According to Rightmove, the average five-year fixed mortgage rate is now above 5% for the first time since January. The average two-year fixed mortgage rate currently stands at 5.41%, up from 4.84% last year. Independent mortgage broker John Charcol says “Lenders are continually adjusting their profitability margins in response to changes in funding lines and shifts in market competition. This adjustment process is a direct reaction to the uncertain financial environment, as lenders strive to maintain their competitive edge while managing their financial risks.” “Swaps have reduced slightly in recent days as markets price in a rate reduction, which should pave the way for lenders to reprice marginal decreases.”

Technology

Wi-Fi speed can be significantly affected by the slowest device on the network due to the shared nature of wireless channels. When an older or slower device is connected, it can occupy more airtime, leading to reduced availability for other devices, thus slowing down the entire network. This issue is exacerbated by backward compatibility, where modern routers must support older Wi-Fi standards, sometimes lowering the network’s overall performance. Additionally, devices with weak signals or those far from the router can cause the network to operate at a lower data rate to maintain stable connections. To mitigate this, users can upgrade devices, optimize router placement, use Quality of Service (QoS) settings, or set up separate networks for older devices.

Customer Markets

Landlords

There has been a 577% year-on-year increase in Right to Rent checks. Under the Right to Rent Scheme, civil penalty fines for non-compliance have risen significantly since earlier this year, with penalties reaching up to £20,000 for landlords and letting agents who fail to adhere to the regulations. All landlords and letting agents in England are responsible for ensuring that individuals without lawful immigration status do not access the private rented sector. The civil penalty for landlords and letting agents has been raised from £80 per lodger and £1,000 per occupier, to up to £5,000 per lodger and £10,000 per occupier for a first breach. Repeat breaches are now £10,000 per lodger and £20,000 per occupier, up from £500 and £3,000 respectively. Recent research reveals a rise in fines issued to agents this year, with Q1 recording £165,680, which is greater than the whole of 2023 (£151,480.)

Build to Rent

Caddick Group based in Yorkshire surpasses £500m annual turnover, this group includes Caddick Developments, Caddick Construction and Moda living. Over the last period the Caddick group included over 4,500 homes on site and two million sq ft of industrial and employment space under development. Contribution to their success would be the significant investment made into key sites and expansion into new regions within the UK. Record occupancy was reported across Moda livings Build to rent neighborhoods. “It’s been another strong year for Caddick Group, and we’re particularly proud to have hit a milestone turnover of over half a billion pounds, as well as securing an impressive development pipeline to secure the future success of the business.” Johnny Caddick, Caddick Group and Chief Executive, Moda Living.

PBSA

Investment in the UK’s purpose-built student accommodation (PBSA) sector surged to nearly £750 million in the first quarter of this year, up from £148 million in the same period in 2023, according to Knight Frank. This growth highlights the sector’s resilience despite broader economic challenges, driven by strong fundamentals and attractive risk-adjusted returns. While funding market challenges have shifted deal structures toward joint ventures for secondary locations, slowed build cost inflation to 3.1% in 2023 supports the viability of new and existing projects, with London leading in development.
Research from Savills underscores the significant supply-demand imbalance in the PBSA sector, with Glasgow needing 22,000 extra beds and Edinburgh needing 17,000 to meet demand. To achieve a preferred student-to-bed ratio of 1.5, 234,000 beds are needed across 20 major student cities. Despite the challenges, including recent restrictions on student visas and the upcoming General Election, the strong demand for student accommodation presents opportunities for private landlords who can navigate the evolving market.

Serviced Accommodation

In Scotland, recent restrictions on short lets, including stricter licensing and enforcement rules, are having a significant impact on platforms like Airbnb. These measures, aimed at regulating the short-term rental market, are reportedly harming the tourism industry and limiting economic opportunities for locals. According to UK government data, rental prices have soared to their highest annual rate in nearly a decade. Airbnb has pointed out several issues resulting from the new regulations: soaring rental prices, a surge in hotel prices, the adverse effects of the licensing scheme, the so-called ‘Taylor Swift effect,’ and shifts in travel trends. Airbnb argues that many of their hosts are ordinary people who offer unique and personalized travel experiences, thereby contributing to the local economy and supporting their communities. The restrictions, however, are creating challenges for both hosts and tourists, potentially diminishing the overall appeal and economic benefits of short-term rentals in Scotland.

Social Housing

Government’s current use of grant has been criticized as doesn’t target social rent homes where residents have the lowest rents. The Levelling Up, Housing and Communities Committee says the  funding model was “inefficient”, the MPs said, when “these homes can be financially viable with no direct grant”. Affordable rent homes should be provided by private investment to free up grant funding for more social housing, a cross-party parliamentary inquiry has concluded. They recommended the government should assess the role of private investment providing affordable rent, to “free up grant funding” for more social housing provision. In addition, the government should scale up investment so that the country can hit a target of 90,000 new social rent homes a year, they said.

We hope you enjoyed this latest edition of our quarterly newsletter. We hope to see you next season!

If you would like to know how Landlord Broadband can help you:
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Call 0333 577 0600
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