Sunday Supplement 14 Sep 25 - Fairness?

“Intergenerational justice, intergenerational fairness and equality is going to be the issue of the next 10 or 15 years. Is this generation, my generation, going to do right by the younger generation?” Ed Miliband, January 2012 This week’s quote goes straight to the deep dive and I believe gives a good grounding for the thoughts that go into the main report analysed in there this week, from the Joseph Rowntree Foundation. Buckle up - it is a hard read. Before we go into this week full hammer - Rod Turner and I will be running our next Property Business workshop on Wednesday 1st October, in London - subject matter this time is Investment, with an emphasis on what metrics you really need to be considering to run your property business properly, and building your business to scale. We’re digging into the real fundamentals of property investment for growth—from proper valuation and strategic debt structuring to the investment metrics serious pros use (hint: ditch ROI and yield). Learn why some deals work for some and not others, how to manage risk as your portfolio scales, and when to shift gear from side hustle to scalable business. We’ll break bottlenecks, build strategic pillars, and unpack real-life case studies of fast company growth. How have we done so many deals? We’ll tell you!This is your LAST CHANCE to book the SUPER EARLY BIRD tickets with 20%+ off, now: http://bit.ly/pbweight Let’s plough on with Trumpwatch. Rarely is it NOT an event-packed week! Trumpwatch in general, and the Supplement more broadly, is an economics-focused view. Recent weeks and months have had a more political bent - unavoidable to an extent, and when the summer “silly season” is with us, politics is more in focus. It’s impossible to let this week pass without commenting on the assassination of Charlie Kirk, and Trump has certainly been vocal himself on this. As usual, my commentary will try to provide something that I haven’t seen out there, and I thought of the more recent political assassinations in the UK that spring to mind - and whilst Kirk was not an elected official, it is very difficult not to describe him as a person of significant political influence who was directly involved in political campaigns. In the UK one MP on both sides has been killed in the past decade - you will likely remember Jo Cox’s murder, shot and stabbed outside her constituency surgery by a far-right extremist with links to Neo-Nazi ideology, because of the amount of coverage that there was - in June 2016. Sir David Amess was also tragically murdered during a constituency surgery in 2021 - stabbed by a radicalised Islamist extremist. More recent, and most certainly well-covered in the news although my sense would be that Cox was covered even more extensively. Neither of those murders, however, shook the world as much as Kirk’s. Perhaps because of his level of online presence already, or there could be other reasons. I looked at Google trends to see whether I could confirm this, and used all 3 names as search terms. For those who don’t know how it works, it indexes everything - so if we compare “Donald Trump” to “Andrew Tate” for example, the most searched person has an index value of 100 and the second most would have an index number below 100, and if it was say 50, it would just mean that the second person is only searched for half as much on Google. I limited the area of search to the UK, so this takes out US searches for example. Compared to Kirk’s 100, Cox’s index when the murder happened was 12, and Amess’ was 6 just after his murder - so Kirk is currently searched for 8x more than Cox and 16x more than Amess, roughly. There may be some time before the search data settles down, as it is so fresh, but that would certainly match my sense of just how much it has captured the attention of the nation. All 3 events will always remain a tragedy of equivalent standing. Moving back to the economics side of the fence; the tariff judgements that will take place in November have been in the headlines of late. If the tariffs (currently ordered under emergency powers) are ruled unlawful, there would be major refunds due (equivalent to between 0.5% and 0.7% of US GDP) to a whole variety of companies. The likely reaction would be more tariffs that (you would think) WOULD comply with the law, changing the frame of everything again. In the meantime, Mr Trump is ignoring all of that and continuing to reference tariffs such as 100% on India and China, for purchasing Russian oil. There’s also open commentary around “unwinding” or “revisiting” trade deals with the EU, Japan and South Korea. The macro figures haven’t looked great. A huge revision downwards in jobs created - a downwards revision was expected, but not 911,000 jobs from the last fiscal year. The context was around 1.8 million jobs added for the year, so that clearly cuts it in half. Other revisions of note included a revision downwards for June 2025 to show a loss of 13,000 jobs, the first monthly decline since December 2020. US unemployment at 4.3% is still doing better than UK unemployment, at 4.7%, but it has been a better figure than the UK over recent years so neither are particularly out of kilter (if anything, relatively, the UK number is worse in context than the US one, but it is close). Growth expected in the US for this fiscal year has also been revised downwards significantly - to 1.6% - with “sticky” inflation, some of which simply factually is linked to tariffs (for the moment). That growth forecast is from Fitch, and that is well down on previous years. Low growth compared to recent times (e.g. 2.8% for the fiscal year previous), but not incredibly out of line with forecasts for the next decade that suggest around 1.8%-2% from the major forecasting houses. The Trump proposition, of course, was that there would be more than this - part of the deal, right? The position I’m sure will still be “blame the last administration, and there’s better to come”. However, tariffgate could have a similar global impact with a different incidence and framework in 2026, the way all of this is playing out. How about interest rates, though? Of course, this drags down near term expectations of interest rates - and the Trump administration will point out that they’ve said this emphatically all along. Get rates down to 1%, has been the rallying cry, they are holding the economy back. All of this macro data puts much more pressure on the Fed to make a 25 basis point cut next week, and the market probabilities make this a racing certainty. There is a small school of thought thinking 50 basis points, and the market gives a hold “no chance”, basically. This move has been what has moderated bond yields worldwide, including ours, because the US has so much influence over the rest of the world’s monetary policy. I’ll close the section for this week with the observation that Trump’s upcoming state visit to the UK is attracting significant attention, in terms of trade policy, and sparking discussions in tech, nuclear, and whisky, particularly. We could do without tariffs dominating 2026 trade policy, but there doesn’t seem to be another plan at this stage. Rule one way illegal, and we will find another way (is the implication) - the overriding of the congressional system using executive orders suggests that even if midterm results are weak, that wouldn’t particularly change anything when it comes to this sort of policy by this method. OK - back to the real time UK property market. Chris Watkin delivers once more - Week 35 in the can. Listings printed 36.8k, in a bumper post-bank holiday week. My “10% more stock than a normal market” ready reckoner is still working on the back of circa 2 years of overperformance in listings compared to historical averages. We are 10.9% ahead of the 9 year average, but that does include 2020 which pollutes the figures somewhat. We are really inching back towards the 2024 numbers now, week by week, having been 6-7% above them at various points in the year - but we are still listing more than we are selling (as always), so it is all eyes on the withdrawal rate as a general rule. We are only 3.3% ahead of the 2024 listings YTD now, and 10.7% ahead of the 2017-19 average. Back to 20k+ price reductions in week 35, with the number being 25,700. August’s completed number was only 11.1% for reductions in the end - much lower than the 14.1% reduced in July, 14% reduced in June, compared to last year’s 12.1%, May’s 13.4%, and the 5-year average of 10.7%. 2025’s average is 13.1%. More stock, more reductions - absolutely and relatively. 22% more reductions than the 5 year average, if you take the difference between 13.1% and 10.7%. “25% more reduced properties than a normal market” also works as a ready reckoner, or is likely to even be an underestimate just because of the amount of stock out there. We’ve still had around 90 to 95 thousand price reductions in the last month. Can’t find a deal? Just keep the legwork up and you’ll get there. You don’t tend to see 13%+ of stock being reduced in strong markets, by any stretch. Holidays slowed things a little but sideways pricing is continuing. 24.9k homes sold subject to contract, again rebounding after the bank holiday. The 2025 average is 26,200. Healthy is still the best description. SSTCs are up 6.3% year on year and 13.7% on 2017-19, and still nearly keeping pace with 2022 (which to this point had only just started to cool after a white-hot start to the year). With SSTCs up 6.3%, whereas listings now are only up 3.3% on last year, this signifies more “intention to transact” than 12 months ago, to this point in the year, for sure - or, put a different way, comparatively this looks like a more functional year than 2024 was (even though stock numbers have continued to rise throughout the year). We went into September with 736,333 homes on the market - a reduction of over 25k on 1st August’s number. I have been waiting for this month, but am loath to draw conclusions given that it was after August. However - if we look back at the past years, September 1st’s number is not usually a drop - and certainly not a large one. It does look like we might well be past peak listings, but it will take 2-3 months to really establish a trend (and will there be a consistent one?). We need more sales agreed for that to happen, and in a week like this with only 24.9k gross sales but 36.8k gross listings, you wouldn’t expect that number to go down (back to school rules apply for this week under discussion, however, and they will for next week also). For context, as the market got stickier before the pandemic that number was c. 660k, a sellers’ market is more likely to be under 600k. At the end of August 2024, 710k were on the market. I think we need another week just to see how much might be “cleared out” and how much more activity there is on either side of the fence in the “back to school” action. Chris also looks at the per square foot on sold STC properties - it has a very strong correlation with prices that hit the land reg in 5 months’ time. This time round - August was at £338.78/sqft and that was 1.41% higher than August 2024 and 14.25% higher than August 2020 - but down 2.2% on June’s SSTC number of £346.45 and down 1.75% on July’s number of £344.78. This is a pretty dramatic drop and may well revise our number for this year, when the figures hit the land reg, down into the 1.5%-2% region for 2025 (it isn’t quite an exact science, although these figures are the most helpful of all of them out there). I think this can be put down to August plus stamp noise, potentially, but if you saw Halifax or Nationwide revise by that sort of number, all hell would break loose (bearing in mind what happens when they talk about prices going down 0.1%!). The increase of only 14.25% since August 2020 with the backdrop of what wages and prices have done since then signifies a big real-terms haircut in property prices over that 5-year period. Never judge by one month, especially when it is August! Fall throughs trickled back above the long-term average of 24.2%, printing 25.8% - there’s still been very little volatility around the long-term average for many weeks now, and that one is a bit noisier than most, but perhaps because of bank holiday “catchup”. The net sales are still there or thereabouts - 18.5k, 5.3% up on last year and 10.1% higher than 2017-19 - not quite at 2022 levels (about 14k behind, now, total) but let’s see where we get to by the end of the year - I think it will be a close run thing on transaction volume compared to 2022 in a much less volatile year. I always give Chris a weekly shout out here because he’s more prolific than “just” this epic tome he releases weekly on the UK property market - he comes up with some great stats on a regular basis. Drop him a like, subscribe, and all the rest of it and some kind words for his content creation. If you are in the industry and want support in growing your business or to be a more effective communicator/be more in touch with your local market - that’s his core business - give him a shout. The article gets published on the Property Industry Eye website, and the video on his YouTube channel - @christopherwatkin

Over to the macro side of things - any Giltquakes this week? This week I’m looking at the Halifax house price index, the RICS Residential Market Report, and “nowth” as we might call it - GDP figures. Then it is out with the seismograph as usual to look at the gilts and swaps.

Halifax’s House Price Index. A different story from the Watkin one (and the Nationwide one) as Halifax reported price growth of 0.3% for August. That’s three rises in a row. Indeed, that’s a new high at Halifax with an average property price at £299,331 (they have the highest average of all of the major players). On their numbers that’s 2.2% up for the past 12 months. They also highlight the average price being paid by first time buyers coming down, and affordability improving, in their headlines - and that Northern Ireland is pressing on with the strongest regional growth, and that the North/South divide is turned on its head in terms of capital growth with the North East leading the way. Their head of mortgages talks of stability (another way of saying largely sideways pricing, I suppose) and a gradual downward path of interest rates for 2 years now (again, I point out that that isn’t really the case for 5-year rates at all, but there we go). They do point out the encouraging sign of 65k+ mortgage approvals in July’s figures as reported last week, on the basis that summer is usually quieter - and that’s a fair shout. On Halifax figures, they only have average house prices up £600 since January. Amanda Bryden also refers to “many competitive fixed-rate mortgage deals being below 4%”. It’s been a rocky couple of weeks on the gilts so that timing isn’t perfect, but it just about holds water. Halifax has the average FTB property down 0.6% since May, and they suggest average repayments on a 30-year 95% mortgage could be £1,179 versus £1,343 average private rent. (I truly hate this comparison, as you might know, because you are forgetting buildings insurance, maintenance, compliance, longer-term running repairs to the structure, etc. etc., but there we go). When we go to the home nations, Northern Ireland is up 8.1% YOY, compared to Scotland at 4.9%, and Wales at 1.6%. The North East, North West and Yorkshire/Humber are all up 4%+ in capital values, compared to a drop of 0.8% in the South West (the first regional Halifax drop since July 2024 which at that point was the East of England down 0.2%). London is +0.8% YOY by comparison. July (via HMRC figures) showed 1.1% more transactions than June, and 4.3% more than July 2024, and also 4.6% more mortgage approvals year-on-year (and 1.2% month on month). However they did note the RICS residential market report showing buyer enquiries and sales agreed at negative balances (particularly sales agreed showing -16%); this was last month’s report rather than the one I’m about to analyse. The headline for this month’s RICS report? Sales market activity continues to slow. How do they conclude that? New buyer enquiries down (well, it was August, right?) and a decline in sales agreed (which we did see play out in the August numbers). None of which would be unexpected, of course. They also report house prices drifting lower at the aggregate level. A little pause on that one, though. Cheaper houses are transacting. More expensive ones are not. That has been the pattern since mid/late 2022. Interest rates are the primary driver there (plus marginal tax rates, I’d argue). If you aren’t very careful with your data, that would show house prices going down (if you look at aggregates). However, if cheaper houses are transacting at 10% more than they were 3 years ago (this is a typical pattern in areas in which I’m invested), but in that time period all of the macro data is showing that prices are only up 3 or 4 per cent, if that, in that timeframe - what’s correct? It’s difficult - and all I’ve highlighted there is a problem that exists within all macro data aggregation. Add everything together and you might well often not get to the root cause of reasons for the issue. However, let’s continue with the report and the conclusions that RICS draw. They also report near-term cautious sentiment. Sounds OK, but I would just describe it as “more sideways”. The balance number - the big one from this survey - is -19%, which looks particularly bearish to me. I’d expect a low negative number. We will have to see who is right and wrong over the coming months. New buyer enquiries? -17%, down from -7% in last month’s survey. Sales agreed -24% from -17% in July. Next 3 months? -2% is the prediction (more sideways). Next 12 months? +1% down from +8% (this is the worst reading since October 2023 on this metric). New vendor instructions? -3%. Market Appraisals? -7%. Some of these are compared month to month, some looking at 12 months ago (so I don’t mean to over-labour the point that August data might not be reliable). When we get into the -19% headline number, we see that East Anglia returns -64% and the South West returns -46%. Next 3 months house prices? The balance in the survey is -20%, so the surveyors don’t see a positive end to the year. +9% over the next 12 is the least elevated reading since December 2023. Lettings, though? Tenant demand on balance is +5%, a minimal change - however landlord instructions are at -37%, the most negative reading since April 2020. Rental increases balance for the next 3 months, +27%. The actual number expected for rent increases from survey respondents is a 3% growth at the national level.

Onto the “nowth” part of the Supplement. Recent growth figures have been pleasing, and PMIs picked right up in July - so it seems only ironically fitting that it would be a 0% print month. June was a pleasantly surprising and even eyebrow-raising 0.4%, so I wouldn’t read a lot into it. The rolling quarterly figure is now 0.2%, after a little drop in May, and falling. August’s PMIs were so good you’d hope it wouldn’t be a 0 figure for last month, once those numbers are published next month.

The strong services prints are being tempered by terrible production figures (down 1.3% in the last quarter) and construction output, which is drastically different from the PMIs, is still showing an increase of 0.6% in the past 3 months (although that is rowing backwards). The monthly numbers there are services up 0.1%, construction up 0.2%, but production down 0.9% which leads us to zero. Our annual run rate is still 1.2% growth per year at the moment, although the print based on 12 months ago is 1.4% (the difference is quarter on year comparison versus year on year). Don’t get lost too much in that, 1.3% is probably an OK proxy figure as an average of the two! Services continue to drive the economy with human health activities up 2.5%, scientific R&D up 3.4%, and computer programming and consultancy up 3.2% and all those figures are just in the past quarter - you can see where the boom industries are, and none will really surprise you I suppose. What’s struggled on the flip side - motor vehicle repair down 1.3%, education down 0.2% and public administration down 0.2% (that one I would think would be seen as a positive - are there some unreported efficiency savings? No-one can get too excited about a 0.2% drop). That last point is a nuance worth labouring. Not all growth is good, basically, is what I am saying, and GDP is often criticized as being a poor metric. The truth remains that it is probably the “least worst” rather than a good metric. It does at least capture inflation and is “real”. WHERE the money goes, for example, is not captured, but GDP per capita makes one further inroad to getting closer to the facts on that (it doesn’t measure inequality, though, of course). Storage and warehousing also got a mention for July in particular. There does seem, underneath everything, to have been a bit of a rebound in consumer spending and confidence overall that I’ve referred to in recent weeks and months, so perhaps that’s reflective of that (starting from a low base, and financed by outsized credit card usage, I would add!). The doctors’ strike gets a mention in passing on the basis that it took place in July, and would have impacted GDP downwards slightly (but not by as much as 0.1%, note). Travel agency/tour operation also bombed over the 3 month period, perhaps because the weather was so good there was limited need to chase it abroad? I’m sure that, plus overall costs, were factors. What explained production cratering? Almost entirely, manufacturing. What else was down - utility supply and mining and quarrying. The only notable growth sector was water supply, sewerage and waste management (up 1.6%). The notable production drops - pharma (there has been some noise around pharma investment in the UK not being viable because the NHS don’t pay enough, but then of course they would say that wouldn’t they - but it is playing out in the growth figures) and computer, electronic and optical products (which I have not heard about more broadly). Both dropped around half a percent just in July. Astrazeneca have been noisy around the current state of play in the UK, and you will also have heard that Jim Ratcliffe’s INEOS have been. In construction, new work is still 3.7% below January 2023. Repair and maintenance however is 17.7% up on January 2023, and I’ve noted in different supplements recently the lurch towards the secondary market - whether that be in right to buy replacement, investment property, or funds looking at the secondary market rather than build to rents that are not hitting their numbers or have become unviable due to the building safety act and related issues with “high-risk” buildings (a poor phrase, the data shows they are absolutely not high-risk by any sensible measure - they are “higher-risk” but that use of the comparative seems to have escaped the regulators, and is just a bad framing overall anyway. The risks just are not high). So, 1.4% per year as the most favourable number is the one adorned in the news outlets sympathetic to this current administration (not many of them, let’s face it). This in the same week that Rachel Reeves suggested, when tied in knots a little, that the economy is “stuck” - and when you look and hear about regulation in general, this promise of cutting it really has been very limited to planning and financial services, and in many eyes doesn’t go far enough on the former (and I’m sure there’s plenty of bankers who’d say it hasn’t gone far enough on the latter, although I’m not so sure about that one!). That leads us to the seismograph. 5-year UK gilts - an up week in the end in spite of the negative US news - but largely we followed the US pattern. We opened at 4.058% on Monday and closed at 4.111% on Friday after a late drift upwards - Thursday’s close was 4.047% so we had a fighting chance of a down week, but it was not to be. The 5-year swap on Thursday closed at 3.702% so still showing a 34.5 basis point discount, keeping those mortgage rates below 4% for resi buyers on best-buy and lower LTV deals, and keeping “the number” for BTL limited company at around that 5.7% mark or a shade lower from the deposit taking challenger banks. That yield curve still looks steep, though. The lowest yielding gilt at the moment is the 3-year, although everything apart from the 1-year is more expensive than it was 12 months ago. The 30s this week actually had a down week on yields, shallowing the curve slightly, opening at 5.517% and closing at 5.502% after a promising Thursday close at 5.439%. Still, shallower is more promising. The drift upwards (in the shorter term) on Friday seems to have been based on weaker sterling, based on the limp growth numbers - but the aggression with which those 5-year yields raised suggests some lumpy bets that rates aren’t being cut particularly soon (which was my overall starting point for 2025 predictions, if you recall!). We know the Bank of England isn't cutting rates next week, but are they in November? The most recent figures have shown between 30% and 40% for a cut, which I think is too high. I would have it more at 20% at this point in time. So, last week it sounded like armageddon and gilt yields dropped - this week there was very little noise and gilt yields rose. Easy game, this, isn’t it? Into the deep dive we go, friends. This week we have a nice mix of reports to tuck into. UK Finance have delivered a number of reports in September which I will give a whistle stop overview of, on lending in general. The meat is in a report from the Joseph Rowntree Foundation, which the audience really won’t like much. It is written from a perspective of bias, unfortunately, but it does have some solid conclusions in it. Some of them are somewhat egg-on-face however, I suspect because the authors are not on top of the real time figures for things like rent rises. It is a good piece of work for yesterday’s world, and I’ll be fascinated to see how long the conclusions play out for (the ones that aren’t inherently biased anyway). As an aside, this week the ONS updated their data on renter affordability, and August 2025 showed 30.1% of household income being spent on rent overall - the highest number since the ONS began using the Dataloft data to produce this series back in 2017. There are related contingencies here as you will see! The ONS considers 30% the benchmark for affordability, so on average rent is now classed as unaffordable (note this is the mean, not the median, so we can’t say for sure that more than half of all rental households are paying “unaffordable rent”). Agents, however, have considered 33% or 40% (or 50% in London) the affordability thresholds for as long as I can remember, and I’m sure back before my time - so the arbitrary nature of the affordability threshold can be debated. What can’t be is that rent is taking up a larger percentage of renters’ household incomes than it has done for some time. When I went back into the ONS annals, I found that in 2005 (for example) - when the ONS rent data set starts, before they were using the Dataloft data set - rent was actually comparatively much higher, but this never gets publicity since it does not suit the overall media narrative - just as an aside! 9th July 2023 - which is my most self-referred to Supplement - all the analysis is in there if you want it - “Cheapest for 20 years”, the article was called. Back from the aside, and onto the UK Finance fare. 4 recent reports since the holidays are over, and just a whistle stop here. Business Finance review (around lending to businesses), Card expenditure (around spending), Household finance review (you guessed it, around household spending), and Later life mortgage lending (about equity release). The Business Finance review is from Q2, and Q2 was the 6th quarter running where gross lending saw growth. That pace is now 8% year-on-year from an unsustainable 14% last quarter (again, after Covid, this is all coming back from a low base). The slowdown is in lending to medium-sized firms, as it goes. Net lending is still inching towards positive territory (i.e. in Q2 it was still net negative, more repayments than new originations). Small companies reported positive news around lending - 28% up on one year ago (quarter-on-year) and further increases in new loan approvals, but fewer new overdraft approvals based on concerns after the NIC increase and also about broader cost pressures. Total deposits still fell but at the slowest pace for around 3 years. Instant access business savings have been run down, and deposits overall are 20% lower than their peak. There are some large sector differences here (you can imagine for example hospitality versus computer consultancy firms, going back to our growth report above). Overdraft utilisation rates were static, with repayments down slightly this quarter - across all sectors. Modest growth and stable delinquency levels were the conclusions, with business being cautious and cost-conscious, with subdued demand for borrowing to invest from SMEs. The three issues cited are international trade risks, fragile consumer confidence, and uncertainty on Government policy ahead of the budget (all fair). Card expenditure for Q2 saw limited change from a year ago in value terms (so think, inflation has eaten away at that). Growth was in food and drink spending, and other retailing - most services sectors saw a fall. Once again UKF refers back to sluggish consumer confidence and cautious discretionary spending. Flat spending, with 3% more transactions - consumers are spending the same amount but shopping around more and more, making more lower value transactions. The average value of debit/credit card transactions is therefore down 3% on a year ago. Contactless transactions are also on the rise, as are online ones - neither of which will surprise you. Household finances, then: a dip in spending in Q2, with increased inflation. Mortgage lending went down sharply - but this is stamp duty noise as we’ve been discussing for months. Growth in June suggested to UKF that there would be “forward momentum”. They talk of no sustained growth in refinancing, although around 10,000 more loans per month are being refinanced compared to last year, as far as I read the Bank of England numbers anyway! Fewer are on standard variable rates as those who have been waiting have either got what they wanted, realised things aren’t going down much more, or given up the ghost and fixed rates anyway. Household savings continue to grow (that will be in absolute terms, rather than % terms). Mortgage arrears also fell again, with possession rising modestly (still catching up on the historical arrears cases). The final piece of interest here in summary is the UKF take on the conversation around lenders being allowed to take more risk in the mortgage market - under current conditions, allowing more lending at lower stress test rates would result in an additional 175 arrears cases for every 10,000 additional loans granted (or 1.75% bad debt, if you prefer). This analysis is far from robust - they see it as linear, and base that on the current bad debt rate on loans that are paying above the stress test rate over the past 10 years. They do admit that the analysis doesn’t take into account that more permissive rules might bring in higher risk borrowers (of course it would) - but they do note that looser criteria would also bid house prices upwards, affecting affordability overall. They also suggest that any loosening would be a small percentage of additional lending, so that impact would be moderated in that case. Not much to draw from this to be honest; too loose to be useful. How about the Later life lending? Borrowers over 55, this is, in case that makes anyone feel old (or young!). 33,130 new older borrower loans in Q2, only up 0.5% year on year. 5,830 were lifetime mortgages, up 3.7% year on year - just over the half a billion mark, and up 10.6% on a year ago. 305 loans were retirement interest only (so you see what a niche area this is!). I wanted to report on this because I still believe that equity release is a badly underutilised estate planning tool for those who have estates smaller than £5m (to put a limit in there). If you have over £5m to pass on and aren’t getting proper advice - then get proper advice. If you have less than £5m, but enough to pay the 40%, that 40% should be driving you to use equity release sensibly and not worry about the debt rolling up within your house. Unless you have a particular and specific plan, or you have one beneficiary, the house will likely cause issues anyway after you are gone - you need to be really sanguine about this in my view. It is never one-size-fits-all but the tool is still badly underutilised to opt a decent slab of your net worth, usually, out of IHT and turn it into liquid cash with no cashflow implication each month. They can’t take the house off you until you go into care, if you do. Again, you might well be better to control that situation than not - but that’s a whole other topic! Onto the Joseph Rowntree Foundation report - the JRF is a charity conducting and funding research to solve poverty in the UK - a creditable cause, although I have pedantic issues with the definition of poverty and whether it is relative (an arbitrary 20% line usually used) or absolute (which I am most certainly in favour of attempting to solve). This report is titled “Rebalancing the housing market through tax reform” and talks of reforms introduced in 2016 marking a “decisive shift in housing policy, reducing landlord demand and freeing up homes for first-time buyers” - so you can see a little of their agenda there, although you could also argue that that argument is demonstrably true - lower demand from one sector will, all else being equal, mean the price goes down for everyone and the beneficiaries of landlord-suitable stock are likely to be first-time buyers. As a longer explanation, because I feel one is needed - it most certainly is for pretty much every house I’ve ever bought, and I’m nearing 1000 purchases and sales combined these days - many investors including readers of the Supplement don’t compete with first time buyers at all. They buy “wreckers”, or problem properties, that are often not financeable with traditional finance methods. I’m not saying FTBs never buy a fixer-upper - many do, although more and more don’t, would be my anecdotal feeling - but I’m talking tenanted, or really problematic, unmortgageable, uninhabitable, auctioned off - etc. Killing demand from that sector (for example, by making additional stamp duty 8% as it is in Scotland) is very different from putting off people from buying houses near London where there is overwhelming tenant demand. I can guarantee you that the latter have been put off by nothing more than the normalisation of interest rates between late 2022 and today - simply because the maths doesn’t work any more. Policy changes had an impact, but as homes got cheaper in 2021, 5 years after these reforms, investment demand was roaring because buy-to-let finance for limited companies was available below 3%. The current market price at 5.7% as discussed just took out so many properties in lower-yielding areas - almost all of them - to leveraged buyers. Anyway - point of order noted. Let’s press on - I appreciate that my own business model is not necessarily reflective of more “amateur” buy-to-let particularly in low gross yielding locations. The first sentence of the summary made me chuckle, even though I do agree with it. “A recent, though relatively under-discussed, aspect of housing policy has been the use of the tax system to dissuade buy-to-let acquisitions, and, in doing so, boost the position of first time buyers (FTBs).” Why did I chuckle? Well, if I had a pound for every time I’d heard someone talk about section 24 and the deep unfairness of it……but I’m not a “normal” person. I chair panel debates at property shows, for example, about this sort of subject. I would say that section 24 is over-represented in this debate versus the formerly 3% and now 5% additional tax on buying BTL properties, though - and obviously s24 only discriminates against individuals in favour of limited companies and other wrappers as well. You’ll realise very quickly where the JRF lands on this - they crack on with “these reforms helped level the playing field between landlords and owner-occupiers” - now here is where the pedant in me falls out with them. The playing field BEFORE s24 was that FTBs could avail themselves of a 95% mortgage versus 75% for a landlord (let’s be generous and say 80%, instead). So - FTBs needed a deposit one quarter of the size. Advantage FTB, agreed? However, landlords could deduct the mortgage interest relief (plus any agency fees, compliance costs and repairs) from any income they made from the property - compared to the FTB being in the “same” position as if they rented - paying mortgages from net income, no (real) interest only available (was to landlords, and still is), at lower rates than landlords, but no benefit other than capital growth and “certainty” as well, I suppose - although rent versus mortgage is not a valid comparison, as I’ve said many times before - only a very rough guide (and IMO needs grossing up by at least 35% to be comparable). Definite points to landlords for being able to use interest only, more points to FTBs for having lower rates, and then the utility piece (an investment and a backstop for a landlord, a roof over the head for an FTB) is a difficult one to quantify. You could call all of that a score draw and the FTB is still in front. The FTB is usually much younger, with much less capital, and so “fairness” across those generations is a hard metric to measure. So let’s not say “level the playing field”. It’s a lie. Let’s say to tilt the table a little more in the favour of the first time buyer. Some (if not many) landlords could even get behind that, I’m sure - altruistically. First time buyers SHOULD have an advantage, otherwise “the game” stops. Any landlords with children with aspirations of buying a house would be in favour, for example, I’m sure, purely for self-interested reasons! For me, when SDLT went from 3% to 5% on additional housing, I knew I would do fewer deals and that the vendors would take most of the incidence of the new higher rate - my offers would decline accordingly. That’s exactly what’s happened - and so I buy fewer wreckers and problem properties now than I would have done, because the marginal deals go to someone else or stay unsold/empty/derelict etc. etc. Rant over (briefly). The claim then from the report is that these “contributed to helping” (bit weak, you’d think) more than a million households accessing homeownership. I hope they are not suggesting that one million houses that otherwise would not have been bought by first time buyers were then bought by FTBs, because that will be an impossible position to take, frankly - but we will find out. They then say that concerns about the potential downsides to renters - namely higher rents and reduced affordability - have not materialised. The publication of this report in the same week that the ONS published the worst affordability metrics since the advent of these tax reforms appears a little ironic - both can’t be true, of course. I’m not blaming higher rents and reduced affordability solely on this either, of course, but to state that they haven’t materialised is a bit of a giggle, and cannot be based on the figures. They then say (for no reason I can work out) what I wish they’d just said in the first place - several reforms introduced since 2016 have focused on strengthening the position of FTBs , recognising that landlords with ready access to borrowing and capital have been able to out-compete residential buyers and drive up prices. I agree as per the above that amateurs might do this. I would contend they wouldn’t last that long, because no-one overpays like a first time buyer. That’s why housebuilders concentrate on them so much, of course. This is hard to evidence, though, without aggregated data on properties where FTBs have competed with landlords (would agents even have data like this? Anyone who knows, or can set me straight, please do so!). For what it is worth, I always choose the FTB (as a seller on more than 100 open market properties) - why? Because they are much more motivated, and much less fickle, and much less likely to try and chip, than a landlord. That’s the only anecdotal evidence I can provide. JRF go back to then pointing out that the approach of strengthening FTBs (whilst also simply raising more tax revenue, which has been the angle for the Government certainly in the move from 3% to 5% in my view, with the FTB position strengthening being no more than a political bonus) has proved unpopular with landlords and their lobbyists (who are, let’s face it, few and far between, fractured, poorly capitalised and not really lobbyists compared to - for example - the oil industry - or the renewables industry, as it goes). The lobbyists cited include Property 118, claiming an “exodus” of landlords - sadly, the JRF does not bother to include the figures which show a huge drop down to half the number of available properties to let in 2024 compared to 2019, but presumably they have alternative figures. I am confused by the denial approach, I must say, at this point in time (in 2021, for example, you could have made a very good denial case in comparison - which is why in truth this is mostly balderdash, because it is interest rate normalisation that has driven the recent changes in the market primarily, in my data-based view). They then DO mention interest rates finally, blaming it all on the Lettuce - now I don’t want to sit in a glass house and throw stones here, but I first warned of inflation in February 2021, it first broke out in August 2021, and all was well underway by the time we reached September 2022. Old salad face made it a lot worse, much more quickly - of course - but she wasn’t the root cause of the entire thing. Remember gilts calmed right back down to below 3% on the 5-year in Feb 2023, before hitting 5% in July 2023. Long gone Liz was - well - long gone by then. It makes me chuckle because they THEN go on about simple and compelling narratives (which is exactly what they are constructing themselves, totally ignoring the data up until this point) but they do admit that the “actual impact of fiscal reform on home purchases into the PRS is less clear and has been subjected to limited analysis”. (Cough). Conclusion - they don’t read the Supplement (and they wouldn’t like it much if they did, I dare say). No analysis, they say, has meaningfully considered what happens to renters when rates of home purchases in the PRS contracts, or when the overall stock of homes in the PRS contracts. Again, cough. Still, I can tell I am going to enjoy this one. Their conclusions - fiscal reform has successfully dampened demand from the PRS, flatlining the size of the sector. This isn’t a mega-conclusion by any means, Chris Watkin has produced graphs to this effect for years, and I have done similar in terms of my own analysis. Sector size peaked in 2016-17. Little regard is given to population growth since then (or demographic changes) - let’s see if the JRF truly are “different”. The claim is indeed then that there are 1 million more OOs than if the trend preceding 2016 had followed, who would otherwise be living in the PRS. Looking forward to it. There has been little impact on those who do remain in the PRS, apparently, and those impacts that exist can and should be managed by policy and regulatory intervention, apparently - that conclusion won’t surprise anyone. Their ultimate conclusion - tax changes have overall been a success, and have “rebalanced” (read - continued to tilt) power in the housing market, and these are viable changes to pursue - and this is the best way for the Government to support more households into homeownership, apparently. What can’t we argue with: Meteoric rise in the size of the PRS between 2000 and 2015. Of course, outside of the rest of the context (for example, how about the social sector and lack of replacement of right-to-buy?) But nonetheless, their selected data point is true. By cherrypicking 2000 when you know the data (although arguably with the advent of the HA88, or the BTL mortgage in 1996, both of those would be fairer starting points) - the PRS grew from 2.1m in 2000 to 4.8m in 2015. Can’t deny it. They do mention the social housing stock, although they choose to ignore numbers or not provide them for context. They mention the affordability scoring on rents, not incomes (fair cop? Not convinced - let’s remember you can borrow on 80% of rent or 4.5x income, so if rent is 30% of income on average, then borrowing on rent is 80% of 30% = 24% or 4.17x rental income, so it doesn’t really hold up as an “advantage”), and they follow the pattern of many analysts with an agenda - when ideology gets in the way just say it, when you can prove it with figures then use the figures. They follow up the tax point with a convoluted graph which misses a lot of the point of section 24 - that you get into the tax bracket based on the gross BEFORE the 20% relief is applied, and so many with one property and a basic income are pushed into higher rate thresholds when they are not higher rate tax payers (and beyond). I was going to use it as the image but I really can’t tell if the analysis is correct on this basis - they omit this point so I can only assume they don’t understand it, or haven’t researched it sufficiently. Their graph claims that the percentage in gross rent going in tax has gone from (pre-reforms) 7.8% for basic rate taxpayers, 15.7% for higher rate taxpayers, and 17.6% for additional rate taxpayers to the same (which is wrong for the reasons I said), 24.2% for higher rate taxpayers, and 28.3% for additional rate taxpayers. This is a hard percentage to conceptualise - because as many have said in the wake of s24, how can you calculate tax on turnover. That’s what’s being done here. There’s no comparable in any other business. But what we can say IF we accept the JRF figures is that the tax incidence for higher rate taxpayers is up 54% and for additional rate taxpayers is up 61%, when we look at the relative move. Quite the hike, I am sure you would agree. That’s just as a share of income as well, not an absolute figure - so if rent had gone up 20% in that time (well below inflation, as you know) that would be more tax from an absolute perspective, and the percentages would go up (if you moved up the tax brackets). The marginal rate might well be 60% more tax that you were paying before, or more! They then estimate that 20% of landlords have been affected by these changes. This is poor analysis to prove a point here, and, as always, in their claims of magnificent analysis, they’ve missed an opportunity. What percentage of TENANTS have been affected, JRF? It is self-evident that the more properties you have, the more you would have been affected - and if a fifth of landlords are affected but 80% of landlords have 1-3 properties, the 20% that have 4+ would control far more than 20% of the rental stock? Why do we care what percentage of landlords have been affected anyway? This figure proves nothing, to be honest - we know JRF care naught about tax fairness; they care about giving the younger and the poorer a better chance of homeownership (and it isn’t that easy to argue with that standpoint, moralistically, but it is much easier to view everything they produce in that light, of course). OK - income tax and s24 done, at least as far as JRF are concerned. How about HRAD - the Higher Rate of Additional Duty on SDLT. Introduced in 2015 as a double gutterball alongside s24, but starting from 1st April 2016 - JRF estimate the average landlord would pay £8,500 after this change on a purchase, up from £2,000 before the change - because they assume the landlord will pay the same as the average FTB. This is a false assumption, in my view, because of the number of landlords who put in effort to add value. My contention would be that the average landlord purchase strike price would be lower than the average FTB price. They are more savvy buyers, and less motivated, for a start. It also strikes me as a bit lazy in terms of analysis, because if you are going to do the best piece of work ever done on landlord tax changes, which this is presented as, you’d make the effort to get this right, surely? I actually went and looked at the higher additional rate duty, and found that this was not a terrible estimate, but not for the want of being accurate. It looks like around £260k is the average price for a higher rate additional duty transaction. Now, not all of these are by landlords (can’t resist the temptation to refer to Angela Rayner, who of course wasn’t in this sample but should have been!), but the vast majority can be assumed to be - close enough to make very little difference. It also rankles me that the JRF see FTB purchases as directly equivalent to landlord purchases, so they just think it is OK from a data integrity perspective to do this. Nonetheless, it is what it is and it isn’t that far off. This report only uses data until Q3 2024 so there isn’t any analysis of what 5% HRAD has or hasn’t done, we should note (and we would want a couple of years of that to really read too much into it, alongside stable interest rates - which arguably we have now had for around 18 months or more, certainly based on the 5 year rate anyway). We also need to look at the return of the 125k band as well, of course, which will add to the 5% woes. Nevertheless, let’s roll with what they’ve done. There’s then some discussion of the removal of tax advantages of short term lets - including effectively bringing them in under the scope of s24 - and the abolition of multiple dwellings relief, which was a limited tool used (although it made a difference). The move of capital gains tax from a higher rate of 28% to 24% was also framed as “boosting the availability of housing by encouraging residential disposals” in a quote from the Treasury in 2025. This report seems to confuse a few things. Firstly - that a freeze in the supply of the PRS is a good thing. To a point, you might be able to get on board with that. An increase of 2.7m properties into the PRS in 15 years, from a base of 2.1m, is excessive by any measure. There’s no debate there. However - if there is an excess, and then that excess is run right down (as evidenced for example by the number of available properties plummeting) - would it not be reasonable to theorize that the low hanging fruit has been plucked, and further tax changes (which there is just not the data as yet to analyse properly and objectively, even if anyone wanted to) might have an adverse effect? This really comes down to the argument as to whether you need a functional PRS or not, of course. Some ideologues believe that you don’t - all property is theft, yawn, yawn, etc. There’s limited thought given to transition - which is silly, because recent rent increases that have outstripped (or, more accurately, just lagged) inflation are undeniable in the data as I’ve already mentioned. We do have to give credit to one graph in the piece, however - I would mention correlation and causation here, and the near-complete omission of the inflection point around the 2008 crisis when lending criteria tightened up massively and credit was essentially withdrawn - and the title of the graph conveniently just leaves this out altogether, which calls into question the true integrity of the analysis of course. Nevertheless, I’ve replicated the graph as this week’s image. Economically, from a textbook perspective, what happened here is that the landlords before the changes in 2015 were making what economists call “supernormal profit”. The sector could and would survive with suppliers instead making a “normal profit” - so, it is still profitable but not so profitable that more and more people come into the market to supply the sector. I don’t doubt there’d be a raft of economists behind this viewpoint. Why use 1990 as ground zero? Not discussed, as so often in these cases. Not the worst year to start, though, from the owner-occupier perspective - a really tough few years in terms of recessionary times, which saw rental stock drop in the first few years. However, the pickup from when the BTL mortgage really went mainstream is there for all to see - it is also interesting that the GFC did not really knock that trend off at all. Here’s the problem though. Let’s split the graph into pre-GFC, GFC to tax changes, and tax changes to present. Pre-GFC the rate was around 1.9m more owner-occupiers in 17 years, at a reasonably steady and linear pace. There’s a difference between 1990-2002 when the PRS line is very shallow, and the owner-occupier line moves at about 35-40 degrees upwards (about 140k homes per year, net), and then 2003-2007 when the PRS line starts to move at more like 40-45 degrees upwards suddenly, and the OO line only moves up by perhaps 10 degrees in those 4 years (about 50k homes per year, net).

However, the GFC really knocks things out for the OO line. It moves downwards for about 6 years. The rate of change in the PRS is completely unchanged from the several years BEFORE the GFC. I’m not denying it is a meteoric rise - but the GFC has a clear impact on the OO market, and not on the PRS market. In London, this would have been easily explained by cash buyers who were doing very well in the 2009-2014 time period, for example (so credit withdrawal did not deter them).

It’s hard to draw a formal conclusion from this graph other than “JRF have presented part of the story, and it is a compelling part of the story”. Ultimately, the PRS flatlines and the OO graph moves up at a 45 degree pace. That again cannot be denied. Recent mortgage underwriting changes encouraged by the regulator around the stress test - as I’ve covered extensively in the recent past - will also help more FTBs, there’s no two ways about it. Is that as charitable as I’m going to get? I think so. I don’t like the 100% correlation implication that is brought about when other obvious arguments should be being discussed. Nevertheless, the final part of the graph is pretty compelling. Next up, buy to let lending lost a lot of market share - similar to the performance around 2009-10 - which again supports the fact that the post-GFC climb into renting was cash fuelled. When we get into the weeds, they introduce a complicated (but reasonable) multiple regression model. Their conclusions here? Interest rates explain most of the variation in real, new gross BTL investment - whereas average income tax levels have a smaller but still significant impact. Strange that that didn’t make it into the summary, isn’t it? In a way though - and although they don’t frame the conclusion like this - while yields were decaying pretty much throughout the 2010s, BTL was still benefiting from that, even as taxes did change - however, tax changes were stark enough to kill off the sector growth, and then when interest rates went the other way - as they were always going to - it really turned the screw (although the data hasn’t gone far enough to really evidence that as yet) - and where they get their rent conclusions from, I do not know! There is some mention that saving in accounts like ISAs has become much more attractive again, which is of course relevant. However, they claim there is no correlation between any other returns and the rate of growth of the PRS - which would support the age-old conclusion that landlords “don’t like stocks and shares”, regardless of anything else. The next graph is an eye-popper. It is figure 11, if anyone wants to read the whole report. It shows landlords (higher rate) post tax making a loss in all of 2023, on average, of over 10% of rental income (and basically breaking even before s24, but losing around 12% on average of rent roll) - down from a 30% profit position in 2021 and before that. The most recent quarter that they analyse (Q3 2024) is the one that just pops its head back above breakeven. Next up, some numbers I’ve not seen before. In 2010 one property landlords owned 40% of the stock - it is now 20% (as of end 2024). 2-4 property landlords owned 30% of the stock by the end of 2024 (up from 20% in 2010). Landlords owning 5+ properties moved from owning 40% of the stock in 2010 to 50% at the end of 2024. These numbers are conveniently round (a bit like the Rowntree’s iconic Fruit Pastille, ironically enough) - but they come from the English Private Landlord Survey. I’ve never seen this analysis attempted before; something is better than nothing, in spite of its credibility (it is a survey, not a measure, of course). This is, overall, welcomed by the JRF as it should be better managed and mean better quality, as it does across Europe. They don’t mention (presumably because it doesn’t fit the narrative) that in 2010, 11.4% of properties were owned by landlords with portfolios of 100 properties or more according to the survey, but by 2024 this number was 2.6% of properties - so major portfolio holders own less than a quarter of what they did. It is a shame that they miss details like this, because it calls all of their conclusions into question. There’s then some fairly useful analysis on the amount of support provided by the Government, although it doesn’t attempt to distinguish on what’s more helpful - Help to Buy, the LISA first time buyer bonus, and interestingly, the Bank of Mum and Dad spiked during 2021 when the market was booming but isn’t doing that much more business than it was around 2009-10. Having tapered down HTB without hurting FTBs - which isn’t spoken of much, if at all, the Government is spending less (although it isn’t necessarily spending when it is guarantees, of course, but HTB funds were spent because they were going to developers - they were just coming back in the frame of repayments, naturally). Onto a part that the JRF might be rather annoyed to be cited on, in the future, I’d think, and the bit I was looking forward to the most. This has all not affected rents. Their words, not mine. How do they evidence this? Median expenditure up until March 2024 is down for the bottom 40% of income earning households. The next bit? There was no real term rental growth between 2016 and 2021. This is true - indeed, I shared a graphic from Chris Watkin earlier this week that shows real rents down in London, and the South East (it isn’t the case everywhere) since 2016 to present day. Rent rises since 2021, which the JRF of course acknowledges have been “sharp”, are for reasons beyond tax reforms. I’d agree. They are because of high levels of inflation and earnings (as the JRF put it - there’s also a much higher cost of delivering the service, but that part of basic economics is left out because it doesn’t fit the narrative) but primarily it is all driven by higher interest rates and the stark normalization that’s gone on - back to the “old days”. There’s then a lot of comparison of 20-34s that spreads back to 2000 - as I’ve discussed before, when we go from 20-25% of people going to university to 50%, but don’t move the age at which we perform analysis, the sample is polluted. An extra 3-4 years out of your working life will cost you 3-4 years in terms of when you can buy a house - or more, when you are paying back student loans. That much should be relatively self-evident - but I’ve been deep into that argument before, so I’m not going to do it again! What about homelessness? Well, the JRF cite “limited data”. We can all see the amount being spent on temporary accommodation rocketing upwards, however; sadly, they choose (as so often this side of the fence do) to cite the section 21 notice as the cause, not having other root causes. They miss the point that more and more PRS properties go into providing homelessness support and cover, via a provider or otherwise, and this is completely lost in the macro figures. One day, one of them will get it. Don’t hold your breath, though. They do understand that landlords have responded to higher interest rates by selling up at higher numbers and this is feeding through to increase the number of those owed a statutory duty to rehouse. They blame structural insecurity here, and cling to the RRB being the saving grace in this department, because 12 months of tenure will be guaranteed (from 6) and notice periods will be extended. I believe the cool kids these days say “delulu”. They then speculate on what the PRS will do next. They push for parity of tax between investment income and work - PAYE. I have stated before when I analysed Torsten Bell’s thoughts on this subject - it is both hard to argue with, and foolish to isolate to landlords only. Charge one level rate of income tax - fine - and get on with it, across the board. Including pensioners who have significant private pension income. That will ACTUALLY raise some real money. Vote Lawrence? Thought not. They also call for s24 on companies, and call the company structure a loophole. This is a horrific mischaracterisation of the circumstances. It is also largely without precedent and would of course encourage more to sell up and actively shrink the PRS (although the JRF would argue that will be a good thing, because people will just buy the properties to live in - delulu again). They also talk about applying ATED to let properties. I’ve said since it was introduced that this will happen one day. Higher value properties are more dangerous and susceptible to this. The analysis is mental here - because the entire premise is that there’s no concept of price elasticity of demand in rental property, even though there is significant academic work on this subject. It’s the equivalent of just putting your fingers in your ears and shouting “RENT CONTROL WORKS” - just like it did in Scotland when rents went up 15% in a year after its introduction. I’ve said it many dozens of times. The academic research suggests that the cost of delivery increases are passed on to the tenant, with about 60-80% (depending on the market) ending up on the rent. It’s a scary idea though, that I could see a Government taking up - George Osborne did what he did to pave the way for the corporations, but the Government would love a bigger slice of course. The actual conclusion - they support a “contracting amateur PRS”. This is where things are a bit wonky - I’ve seen some terrible smaller landlords, but likewise I’ve seen some terrible larger landlords too. The smaller landlords who pay such close attention to detail and provide magnificent service to their tenants - OK, some of those I know definitely count as “professional” I guess, but they’ve always done what they’ve done. Those values will just be gone forever if you tax them out of existence. Imagine the service level when a corporation owns everything and just puts rent up by CPI + 1% on the 4th January each year. Ouch. I just thought I’d drive a truck through the assumptions before we close on this report. Assumptions: Yield 5.5% (most figures are showing 6.5%). Maintenance and management at 1% of property prices - so at 5.5% yield, their number, 1 divided by 5.5 is going on M+M - which is 18.18%. This might be OK but avoids rent arrears, bad debts, insurance and compliance costs - which is a huge omission meaning they are massively overstating landlord profits. Analysis assumes a constant average rate of buy-to-let financing at 3.13%. That went out with the ark, folks, meaning a lot of the rest makes no sense (and the real data is available, and again this is lazy modelling). They claim this is to isolate tax changes - however, it makes no sense for thoughts going forward. Last but not least on this one - what did they miss out? Well, they don’t call for rent controls. They don’t believe rent has gone up because of increased cost bases, although the really aggressive rent rises have happened since their analysis period has ended (remember we are still seeing the PIPR ONS number at 5.9% for rent increases year on year, and for the year ending March 2025 (not in the analysis) the number as 7.7%. So - if it isn’t going up (delulu once more), then why control it? Still - overall, the report has a real deep dive of a feel about it, even if the conclusions are biased and sometimes run roughshod over real methodology - it asks to be cited as Elliott, J. and Baxter, D. (2025) How tax reform has helped balance the housing market. York: Joseph Rowntree Foundation - so here is that citation, folks. Darren Baxter is on LinkedIn, as is Joseph Elliot, with the full report posted. Before I do close, LAST CHANCE to book your SUPER EARLY BIRD tickets to the next Property Business Workshop that Rod and I are running on Wednesday 1st October in central London. This time around - investment metrics and how to run your property business at scale. My favourite topic of all! Book here: http://bit.ly/pbweight Above all - please remember to Keep Calm, ALWAYS listen to or read the Supplement, and Carry On; there will be opportunities abound this year and towards 2030 and beyond - the landscape has been set for a surefire bull run. It will be slow(ish), and take a little while longer to get off the ground - and the amount of stock around is still keeping things suppressed at the moment - but as yields currently continue to improve, it is a case of “here we go” in my opinion.

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