Legacy Weekly Update (27th August - 5th September 2025)
Market & Prices
UK house prices fell by 0.1% in August to an average of £271,079, as reported by Nationwide. This decline was unexpected, with economists predicting a 0.2% rise. The annual growth rate slowed to 2.1% from 2.4% in July. High mortgage costs continue to strain buyer budgets, contributing to the price decline. Despite a recent base rate cut by the Bank of England, affordability remains a challenge due to elevated mortgage servicing costs.
Mortgages & Finance
The average two-year fixed mortgage rate was 4.96% at the end of August, while the five-year rate stood at 5%, according to Moneyfacts. Some lenders, including HSBC UK, have increased loan-to-income caps for first-time buyers to 5.5 times salary to support affordability. The Bank of England's rate cut to 4% has not significantly eased borrowing costs, with rising swap rates influencing mortgage pricing. NRLA Mortgages has partnered with Paragon Bank to offer exclusive mortgage products to members, aimed at expanding property portfolios or raising funds for investment and improvements.
Rental Market & Landlords
The NRLA has highlighted a 20% rise in households at risk of homelessness since late 2024, as more landlords sell properties. London faces a rental crisis with a shrinking supply of homes despite growing demand. Rent increases have slowed by about a third over the past year, but the market remains fragile. Proposed national insurance on rental income could further pressure rents upwards. The NRLA emphasises preventative maintenance to safeguard property value and tenant satisfaction, reducing emergency repairs and protecting investments. Rent Repayment Orders (RROs) are a growing concern, allowing tenants or authorities to reclaim rent if landlords breach legal obligations.
Policy & Legislation
The Renters' Rights Bill is nearing its final legislative stage, with calls for a clear implementation timeline. The NRLA criticises planned changes requiring landlords to bear risks associated with tenant pets. The Treasury is considering taxing rental income, potentially impacting landlord finances and rental prices. Labour's first year in government has focused on increasing affordable housing supply, strengthening tenant rights, and advancing Net Zero commitments, potentially affecting lettings market dynamics.
Planning & Development
Manchester's property market will be a focus at the UK Housing Conference 2025, showcasing opportunities for landlords in a competitive environment. The NRLA is partnering with Hybr to enhance the future of renting, particularly in the student and graduate sectors.
Data & Research
Rightmove's analysis identifies Hull and Sunderland as the most affordable cities for student renters, with average rents of £804 per month. These cities, along with Carlisle, offer significant savings compared to the national average rent of £1,565.
Industry Moves & Corporate
The NRLA has launched an upgraded interactive forum for its members to enhance connectivity and knowledge sharing. A new partnership with Landlord Property Exchange highlights the trend of selling properties with tenants in situ.
Other Noteworthy
The upcoming Autumn Budget on 26th November is anticipated to address potential tax changes affecting landlords. The NRLA is actively engaging in discussions and providing resources to help landlords navigate impending legislative changes, including the new Decent Homes Standard. A guide for managing student tenancies was provided, offering tips to navigate new and existing legislation and maintain profitable investments. Legal responsibilities for landlords were reiterated, emphasising the importance of compliance in repairs, maintenance, and overall property management to avoid legal repercussions.
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