Despite the UK economy heading in the right direction with
record low mortgage rates and unemployment
figures dropping, the rate of
property prices rising in Oakham have tempered since the start of the year.
This slow, but sure, downward trend in the rate of growth has been in evidence
since mid-2014. The increase in property
values continue to outpace the growth in salaries. However, the gap is closing, helped by a lift
in salaries over the last 6 months.
Property values in the East Midlands
region as a whole are 2.9% higher than a year ago. Compare this to the neighbouring regions of
the West Midlands at 3.5% higher and Yorkshire at 1.1%, the majority of the
country continue to see annual house price gains - the exception being Wales
which recorded a slight decline of
-0.6%.
Even with the tempering in house
price inflation, it does not necessarily change my outlook that property prices
are likely to be firmer over the second half of 2015 amid heightening activity
in the Oakham property market. As stated
in a previous article, there is a current shortage of properties on the market,
restricting supply, which in turn will provide stability and support to Oakham
property prices. Therefore, my overall opinion is that Oakham property prices
will rise by 5% over 2015 and roughly the same in 2016.
Property investment is a long
term business. Buying the right sort of
property is vital. I have recently been speaking
with a number of Oakham landlords about the importance of a balanced portfolio,
when buying and renting out property. The balance between buying properties
that offer good monthly returns (high yields) but quite often offer poor
capital growth (i.e. they don't increase in value that much over the years
compared with the average) versus properties that do go up in value quicker but
often offer a lower yield. So, what type
of properties have performed best over the last few years in Oakham, especially
in terms of their capital growth?
When
comparing what the average price of detached, semi-detached, terraced and flats
were selling for back at the start of the Millennium to the present day, the
results are quite remarkably different, almost like a bag of “Liquorice
Allsorts”, as the different types of property have performed poles apart over
the last 15 years:
·
Detached Houses
in 2000 were selling on average for £107,115 and so far in 2015, they
have been selling on average in Oakham for £320,707 a rise of 199%
·
Semi-Detached Houses
in 2000 were selling on average for £62,328 and so far in 2015, they
have been selling on average in Oakham for £176,488 a rise of 183%
·
Terraced Houses
in 2000 were selling on average for £51,750 and so far in 2015, they
have been selling on average in Oakham for £170,180 a rise of 229%
·
Flats and
Apartments in 2000 were selling on average for £53,950 and so far in 2015, they
have been selling on average in Oakham for £96,500 a rise of 79%
Moving forward, what should new
and existing buy-to-let landlords do with this information? Well, the questions I seem to be asked on an
almost daily basis by landlords are:
·
“Should I sell my
property in Oakham?”
·
“Is the time
right to buy another buy to let property in Oakham and if not Oakham, where?”
·
“Are there any
property bargains out there in Oakham to be had?”
Many other Oakham landlords, who
are with both us and other Oakham letting agents, like to pop in for a coffee,
pick up the phone or email us to discuss the Oakham property market, how
Oakham compares with its closest rivals (Stamford, Melton Mowbray, Peterborough
and Grantham), and hopefully answer the three questions above.
I don’t bite, I don’t do hard
sell, I will just give you my honest and straight talking opinion and look
forward to hearing from you.
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