145% Increase in Rutland Property Values since the Millennium

 

Since the Millennium, Rutland house prices have risen by 145.86%, whilst average salaries in Rutland have only grown by 51.27% over the same time frame.  This has served to push homeownership further out of reach for many ‘Rutlanders’ as they have to battle against raising considerable deposits and, as a result of new mortgage regulations introduced in 2014/5, meet sterner lending criteria.

The private rental market in Rutland has grown throughout the last 20 years with buy-to-let investors purchasing a high proportion of newly built residential properties that were built and designed for the owner occupier sales markets.  For example, in the Rutland and Melton constituency, roll the clock back 20 years and there were 35,421 properties in the constituency, whilst the most recent set of figures show there are 41,882 properties - a growth of 6,461 properties.

However, anecdotal evidence suggests that a large number of those 6,461 were bought by Rutland buy-to-let landlords, as over the same 20-year time frame, the number of rental properties has grown from 2,513 to 5,968 in the constituency - a rise of 3,455 properties.

Nevertheless, some say this historic growth of the Rutland rental market might start to change with the new tax rules for landlords introduced by Mr. Osborne over the last seven or eight months.  Yet the numbers tell another story.  Across the board, mortgage borrowing climbed to a 9 year zenith in March this year as the British property markets traditional Easter rush corresponded with landlords hurrying to beat George Osborne’s new stamp duty changes.  Buy-to-let landlords borrowed £7.1bn in March 2016 (the latest set of figures released) which was 163% up on the £2.7bn borrowed in the previous March.

Personally, I don’t think things will get worse in the buy-to-let market in Rutland and here are my reasons:

Firstly, what else are Rutland landlords going to invest in if it isn’t property? The stock market?  Since the Millennium, the stock market has risen by an unimpressive total of 5.54%, quite different to the 145.86% rise in Rutland property prices?

Secondly, its true the 3% stamp duty is the first blow on top of a number of other tax changes to be phased in between 2017 and 2021, such as landlords facing a constraint in their ability to offset mortgage interest and, if sizeable numbers of landlords do take the decision to sell their portfolios, this will lead to a substantial amount of second hand properties being put up for sale. Yet that might not be a bad thing, as I have mentioned in previous articles there is a serous shortage of properties to buy at the moment in Rutland: the stock of property for sale being at a 6 year all-time low.

Thirdly, if there are fewer rental properties in Rutland, as supply drops and demand remains the same (although ask any letting agent in Rutland and they will say demand is constantly rising) this will create a squeeze in the Rutland rental market and as a result, rents will rise.  In fact, I predict even if landlords don’t sell up, Rutland rents will rise as Rutland landlords seek to compensate for increased costs, which means more landlords will be attracted back.

For more thoughts, facts and figures on the Rutland property market, you might find the Rutland Property Market blog of interest: www.rutlandandstamfordpropertyblog.co.uk

This week's 3 Best Buy-To-Let deals in Stamford & Rutland

Property 1:
3 Bed Semi-Detached House for Sale:   £215,000
Willow Road, Stamford.  On the market with Newton Fallowell

 

Stamford rental market is as strong as ever and this type of property is still highly sought after, and one for any 'first time landlord' to consider. Expect a return of c.£750pcm.  Make no mistake, we could have this property let by the time it takes you to have read this article!

 

 

 

Price: £215,000

Rent: Approx. £750pcm

Yield: 4.1%

 

Click this link for more details:-
http://www.rightmove.co.uk/property-for-sale/property-60070034.html

 

Property 2:

3 Bed End of Terrace for Sale:  £187,500

Oakham.  On the market with Woodford & Co.

Close to town, close to the station and a very sound investment. Lots of positives with the modern property market. Apart from being a low maintenance property, these properties are always in demand by young families who look to let for at least 3 years.

 

 

 

The rental income of £695pcm is also attractive and it could be one of the properties where your investment grows without you realising you still own it!

Price: £187,500
Rent: Approx. £695pcm
Yield: 4.4%

Click this link for more details:
http://www.rightmove.co.uk/property-for-sale/property-42592809.html

 

 

 

Property 3:

2 Bed Semi-Detached House for Sale:  £184,950

Coniston Road, Edith Weston.  On the market with UPP Property Agents.

 

 

This property takes in outstanding views to the rear and the current tenant has been in situ for 6 years. They would be happy to sign another 6 years given the chance – which makes this property a fantastic purchase for many reasons. Current income of £530pcm (which is low – should be £595pcm).

 

 

This could also make a great property to retire to!

Price: £184,950
Rent: Approx. £530-£595pcm
Yield: 3.8%
Call: Adrian McCarthy, UPP Property Agents on 01572 725 825
Email: Adrian.mccarthy@upp-property.co.uk

Click this link for more details and to arrange a viewing:
http://www.rightmove.co.uk/property-for-sale/property-42592341.html


For a second opinion on any buy-to-let properties you are considering, please contact me and I will gladly discuss further with you.

Email: david@upp-property.co.uk
Tel: 01780 484 554
www.upp-property.co.uk

If you would like to find out your property's current market value, please contact my colleague and sales director Adrian McCarthy on 01572 725 825

Email: Adrian.mccarthy@upp-property.co.uk
Tel: 01572 725 825
www.upp-property.co.uk

 

Visit our popular online blog to register your details to receive the latest best buy-to-let property deals new on the market each week, and for the very latest property market news in Rutland and Stamford.

 

www.rutlandandstamfordpropertyblog.co.uk

59.9% of S.Kesteven electorates voted to LEAVE the EU…

What now for the 7378 Stamford Landlords & Homeowners?

It’s 5.50am as I start to type this article and David Dimbleby has just announced the UK will be leaving the EU as the final votes are counted.

As most of the polls suggested a ‘remain’ vote, the outcome came as a surprise to most people, including the city. The pound has dropped 6% this morning after the city whiz kids got their predictions wrong and MP’s from the Remain camp are using words like “challenging times ahead”.

 

 

So now the vote has been made, what next for the 5881 Stamford homeowners - especially the 2889 of those Stamford homeowners with a mortgage?
 
In the campaign the Chancellor suggested property prices would drop by 18%.  Using Treasury estimates, their method of calculating this was tenuous at best, but focused around the abrupt and hasty increase in UK interest rates, which in turn would raise the cost of mortgages, and therefore lower demand for property, causing a drop in property prices … and I would say, yes … that will probably happen.

Stamford Property Values

Stamford property values will probably drop in the coming 12 to 18 months.  But by 18%?  I am sorry I find that a little pessimistic and believe that figure was rhetoric to get homeowners and landlords to vote in a particular way. But the UK property market is quite a monster.

Since the last In/Out EU Referendum in June 1975, property values in Stamford have risen by 1734.1%

(That isn’t a typo) and whilst property prices did drop nationally by 18.7% between the peak of 2007 and bottom of the market in 2009, when one compares property values today in the country, compared to that all-time high of 2007, (the period before the financial crisis of the Credit Crunch of 2008/9), prices are still up 10.14% higher.

Another Credit Crunch?

And so, notwithstanding the Credit Crunch, the worst global economic outlook since the 1930s and the recession it brought us, a matter of a few years later, the Government was panicking in 2012/3/4 that the housing market was a runaway train.

Now the same Credit Crunch Doom-Mongers and Sooth-Sayers that predicted soup kitchens in 2008/9 are predicting Brexit meltdown. Bad news sells newspapers. Stock markets may rise, stock markets may fall, yet the British public continued to buy property in 2009/10 and beyond.  Aspiring first time buyers and buy to let landlords dusted themselves down, took a deep breath and carried on buying … because us Brit’s love our Bricks and Mortar.  We need a roof over our head.

However, as mentioned previously, if the value of the pound drops, in the past UK interest rates have risen to reverse that drop.  However, whilst a cheaper pound will make your pint of Sangria a little more expensive on your Spanish holiday this year and make your brand new BMW pricier, it will make British export cheaper! Which is great for the economy.

Interest rates

And what of interest rates? Since 2009, interest rates have been at 0.5% and lots of people have become accustomed to those sorts of levels. So, what if interest rates rise?  Is it the end of the world?  Interest rates in the 1986/88 property boom were on average 9.25%, the 1990’s they were on average around 6.5% and uber-boom years (when UK property values were rising by 20% a year for three or four straight years across the UK), 4.5%. Many of you reading this, who are in your 50’s and older, will remember interest rates at 15%.

But I suspect interest rates won’t rise that much anyway, as Mark Carney (Chief of the Bank Of England) knows, raising interest rates causes deflation – which is the last thing the British economy needs at the moment. In fact they have been printing money (aka Quantitative Easing) for the last few years (which causes inflation) to the tune of £375bn a month. A bit of inflation because the pound has slipped on the money markets (not too much, mind you) might be a good thing?

Because, whilst property values might drop in the country, they will bounce back.  It’s only a paper loss, because it only becomes real if you sell.  And if you have to sell, again as most people move up market when they sell, whilst your property might have dropped by 5% or 10%, the one you want to buy would have dropped by the same 5% to 10%.  And, here is the best part (and work your sums out) you would actually be better off because the more expensive property you would be purchasing would have come down in value (in actual pound notes) than the one you are selling.

The Stamford landlords of the 4,701 Stamford buy-to-let properties have nothing to fear neither, nor do the 11,612 tenants living in their properties.

Buy-to-let is a long term investment.  I think there might even be some buy-to-let bargains in the coming months as some people, irrespective of evidence, panic.  Even if we pull up the drawbridge at Dover and immigration stopped today, the British population will still increase at a rate that will exceed the current property building level.

Britain is building 139,600 properties a year, but needs (according to the eminent ‘Barker Review of Housing Supply Report’), to build about 250,000 properties a year to even stand still, and as the birth rate is increasing, the population is living longer and just under a quarter of all UK households now are occupied by a single person, demand is only going up whilst supply is stifled.  Greater demand than supply equals higher prices. That is definitely a fact.

So, what will happen next?

Well, there are many challenges ahead.  The country has spoken and we are now in unchartered territory – but we have been through a couple of World Wars, an Oil Crisis, Black Monday, Black Wednesday, 15% interest rates and a Credit Crunch … and we survived!

And the value of your Stamford property? It might have a short term wobble… but in the long term -it’s “safe as houses” regardless.

 

 

David Crooke

Managing Director

UPP Property Agents 01780 484 554

 

Author of
‘The Rutland & Stamford Property News’

‘The Rutland & Stamford Property Blog’ www.rutlandandstamfordpropertyblog.co.uk

My 3 Best Buy-To-Let Deals this week in Rutland and Stamford...

Property 1:
3 Bed Semi-Detached House For Sale:  £195,000
Drift Avenue, Stamford.  On the market with Newton Fallowell

Perhaps not the best investment for those clients looking for a quick turnaround with new tenants. However, with the opportunity to add value to the property and modify the internals with a basic refurbishment this property would be an excellent rental.


You could expect a return as high as £850pcm should the internal spec be of good quality. Adding in your refurb' costs you could receive a net return of 4.8% yield, let alone capital growth.

Click this link for more details:-http://www.rightmove.co.uk/property-for-sale/property-60076769.html

Price: £195,000
Rent: Approx. £850pcm
Yield: 4.8%


Property 2:
2 Bed Terraced House For Sale:  £145,000
Deans Street, Oakham.  On the market with Murray Estate Agents

2 bed Victorian mid-terrace cottages in the centre of Oakham are so sought-after, we could have this let by the end of this week!! What I like about these properties is the fact you do get honest long term tenants who make the house a home.

With a monthly return as high as £595pcm the yield is nearly touching 5%. We all know this is an excellent return for Oakham.

 

Click on this link for more details:-
http://www.rightmove.co.uk/property-for-sale/property-59973737.html 

Price: £145,000
Rent: Approx. £595pcm
Yield: c5%


Property 3:
3 Bed Semi-Detached House For Sale:  Guide Price: £195,000
Burley Crescent, Oakham.  On for sale with UPP Property Agents

Our sales director, Adrian McCarthy, has taken on a fantastic Buy-To-Let investment. A large 3 bed semi with driveway, utility, dining room, extended bathroom and a large garden with views over farmland. Expect a return of £695pcm - £725pcm on this property which would bring in a yield of 4.4% (assuming you paid asking price). Adrian tells me the vendor will accept an offer which would push your yield investment up further. One not to miss!



Click this link for more details:
http://www.rightmove.co.uk/property-for-sale/property-42563574.html 

Guide Price: £195,000
Rent: Approx. £695-£725pcm
Yield: 4.4%+
Call: Adrian McCarthy, UPP Property Agents on 01572 725 825
Email: Adrian.mccarthy@upp-property.co.uk



If you are considering purchasing a different investment property to the above and would like to discuss it with me, please do get in touch. Simply email me a link to the property, irrespective of who is marketing it, and I'll happily talk it through with you - good and bad!.

Contact: david@upp-property.co.uk or please call me on 01780 484 554. 

If you have a property and are unsure of its current value, please contact our sales director Adrian McCarthy for an accurate market appraisal.  We are all aware of making first impressions count - but it is crucial to price your house right from the beginning. I have discussed this in a recent article on my blog - please click this link to read the article:
http://rutland-stamford-property.blogspot.co.uk/2016/06/asking-prices-of-stamford-property-down.html

Sales Contact: Adrian.mccarthy@upp-property.co.uk please call Adrian on 01572 725 825

We look forward to discussing property with you.


David Crooke

Managing Director
UPP Property Agents & Author of The Rutland and Stamford Property News

Call: 01780 484 554

Twitter: @UPPproperty  

LinkedIn: David Crooke

www.upp-property.co.uk
 

The Oakham Property Market and The Euro 2016 Football Tournament

With the Referendum on EU membership looming, households can concentrate on something European that doesn’t involve party political broadcasts or politicians treating us all like children…the Euro 2016 Football Tournament! 

 

Oakham is home to many different backgrounds and nationalities, so if you're not lucky enough to be jetting off to France for the footy, have no fear!  For a bit of fun (although there is a serious side to this – you know there would be with me!), I have taken a look at which Europeans reside in Oakham.  Basically, so I know who to soak up the best atmosphere with at The Grainstore Brewery with!

During my research some interesting numbers appeared.  Going into the Euro 2016 tournament, France were 3/1 favourites, then Germany 7/2, third Spain 11/2, then England 9/1, Italy 16/1, Poland 50/1, Romania and Wales at 100/1, Ireland at 150/1 and Northern Ireland 500/1… (Although, let’s not forget Leicester were tipped at 5000/1 at the start of last season!).

Of the 100,926 residents of the Rutland and Melton Constituency, of the Home Nations going to the competition, 91,519 of them are from England, 1,177 from Wales, 447 from Northern Ireland and 444 from Ireland, although I do feel sorry for the 1,896 Scots who didn’t get into the finals.  Now interestingly, looking at the mainland European residents in the Rutland and Melton Constituency, it might not surprise you that they make up 2.29% of the population as a whole in Rutland and Melton.

However, even more fascinating, of those 2.29% European residents, 1.22% are from Western Europe because EU residents from Eastern Europe - i.e. the Accession Countries to the EU between 2003 to 2007 (Czech Republic, Estonia, Latvia, Lithuania, Hungary, Poland, Slovakia, Slovenia, Bulgaria and Romania) only make up 1.07% of the population of the Rutland and Melton Constituency.

Broken down into the relevant football teams, there are in the Rutland and Melton Constituency the following …  

118 French

692 Germans
96 Italians
69 Spanish
735 Poles
12 Romanians
… I feel sorry for the Romanian football supporters around here!

But what does this have to do with the Oakham property market? Quite a lot in fact.  Many of these Europeans were economic migrants, especially those from Eastern Europe.  A lot of people’s concerns over migration are exaggerated as this EU migration has acted to fill gaps in skills and labour supply during growth periods of the mid 2000’s and subsequently over the last five years in Oakham, EU migrants have done little to displace native workers, but do the jobs us Brits don’t often want to do.  There is no preferential treatment for council housing in Oakham, so EU migrants have in fact increased demand for privately rented accommodation in Oakham. 

With demand for housing in Oakham remaining strong, Oakham landlords are continuing to buy properties to rent out to keep up with this demand.  This in turn keeps values high, as landlords typically purchase ‘buy-to-let starter home style’ properties*, thereby releasing existing homeowners to move up the property ladder – benefitting everyone in the chain and, therefore, the property market overall.

However, rents have remained relatively subdued, in Oakham rents are only 15.0% higher than they were in 2005, not bad when you consider we have had 38.52% inflation in the UK economy as a whole over the same 11 years.

EU migration has meant existing homeowners, landlords and the economy as a whole in Oakham (and the UK) have benefitted from better economic conditions and property prices not slumping, whilst rents have been kept in check by wage inflation.  Now, I wonder who will win the Euro’s?  Back to the TV!

*For details on the week’s best buy-to-let deals currently for sale in Rutland and Stamford, along with a library of articles covering the property market in our area, backed up with local facts and figures to assist you with property investment research, visit the Oakham Property Blog www.rutlandandstamfordpropertyblog.co.uk

 

 

 

Asking Prices of Stamford Property Down 2% In The Last Year

I had an interesting question the other day from a homeowner in Stamford who asked me the difference between ‘asking prices’ and ‘property values’, and why it mattered?

When it comes to selling property, there must be agreement between the purchaser (buyer) and seller (vendor) for a property sale to take place.

The value a buyer applies to a property can massively differ from the value a seller or mortgage company places upon it. The seller, the buyer and the mortgage company must find an agreeable value to assign to a property so the sale can proceed.

In many of my articles about the Stamford property market, I talk about values, i.e. what property in Stamford actually sells for, but I haven’t spoken about ‘asking prices’ for a while. Now asking prices are important as they are one of the four key matters a potential buyer will judge your property on (the others being location, bedrooms and type). Price yourself too high and you will put buyers off. So let’s take a look at the Stamford numbers.

Over the last 12 months asking prices (i.e. the price advertised in the paper and on Rightmove etc.,) in Stamford have decreased by 2%, taking the average asking price in Stamford to £336,400 (down from £344,200 twelve months ago).

Interestingly though, when we look at detached and terraced property for example, a slightly different picture appears.

12 months ago, the average asking price for a detached house in Stamford was £519,400 and today its £528,200 (a rise of 2%); whilst over the same 12-month period, the average asking price of a terraced property was £259,300 a year ago, and today its £325,200 (a rise of 25%). Therefore, the decrease in other property types have brought down the total average figure.

However, my research shows that the supply of property for sale in Stamford is beginning to increase. In December 2015, there were 120 on the market in Stamford today there are 130 properties on the market (up 8%). This will mean homeowners looking to sell will need to be conscious of how their property compares against others on the Stamford property market.  The Stamford property market still has substantial momentum and sufficient demand remains. This noteworthy increase in supply since Christmas is currently providing more choice for buyers and is tempering asking prices.

… And here is the second point to make. Asking prices are one thing, but what a property sells for (i.e. value) is a completely different matter. These are the average prices achieved (i.e. what they sold for or the average value) for property in Stamford over the last 12 months...

·         Overall Average          £277,300

·         Detached                     £391,800
·         Terraced                     £230,200

You can quite clearly see, there is a difference between what people are asking for property and what it is selling for.

 

The underlying fundamentals of low interest mortgages and tight supply remain prevalent in the Stamford property market however, the number one lesson has to be this ...

 

If you want to sell, be realistic with your pricing from the beginning.

If you have a property and are unsure of its current value, please contact our sales director Adrian McCarthy.

Email: Adrian.mccarthy@upp-property.co.uk or please call Adrian on 01572 725 825

We look forward to discussing property with you.

David Crooke
Managing Director
UPP Property Agents 01780 484 554

 

 

 

 

This week's 3 Best Buy-To-Let Deals in Stamford & Rutland - with yields of 5.2%, 5.5% & 6.3%!!

Fantastic yields this week...

Property 1: Dawson Court, Oakham - Offers Over £150,000
4 Bedroom town house for sale.  On the market with Moores Estate Agents

A 4 bedroom town house located off Station Road in Oakham has to be one of the star rental investments I have come across since we started the blog.

 

 

 

This property would achieve £695pcm (easily!) and based on its asking price, that is a yield of over 5.5%. Fantastic return for the local market. The property offers close proximity to the town and the station – always a winner amongst the commuters. We could have this property let by the end of this week if it was available to let.

Click this link for more details:

http://www.rightmove.co.uk/property-for-sale/property-57842399.html 

 

Price: Offers Over £150,000

Rent: Approx. £695pcm

Yield: c5.5%

 

 

Property 2: Mountbatten Avenue, Stamford - Price: £170,000

3 bedroom terraced house for sale.  On the market with Sowden Wallis.

 

I’ve said it before and I’ll say it again, these 3 bed terrace properties in Stamford are a tremendous investment. Always let with long term tenants and within good proximity to schools, shops and the town centre. I call these properties the best “all rounders” - typically a good size property and with a rental return of £750pcm this would bag a yield of 5.2%. Excellent return for Stamford and one that would let out very easily indeed.

 

Click this link for more details:

http://www.rightmove.co.uk/property-for-sale/property-59866988.html

 

Price: £170,000

Rent: Approx. £750pcm

Yield: 5.2%

Property 3: Launds Crescent, South Witham - Offers in Excess of £94,950
2 bedroom terrace house for sale.  On the market with UPP Property Agents

How about looking at extending your portfolio to the ever popular village of South Witham?

 

A village very much on the up and with capital growth increasing every year as the demand for the village becomes stronger, there is no better yield available within the market we operate in.

 

 

 

 

 

This property would bring you £495pcm and that is an OUTSTANDING yield of over 6.3%!!

 

Properties on this street were selling at mid £70,000’s a few years ago. So, this one is definitely worth considering for the savvy rental investors amongst you.

Click this link for more details:
http://www.rightmove.co.uk/property-for-sale/property-41603598.html

Price: OIEO £94,950
Rent: Approx. £495pcm
Yield: Over 6.3%
Call: Adrian McCarthy, UPP Property Agents on 01572 725 825
Email: Adrian.mccarthy@upp-property.co.uk


If you are considering purchasing a different investment property to the above and would like to discuss it with me, please do get in touch. Simply email me a link to the property, irrespective of who is marketing it, and I'll happily talk it through with you.

Email: david@upp-property.co.uk or please call me on 01780 484 554. 

And finally, I was recently asked about the difference between ASKING PRICES and HOUSE VALUES, and my response concluded with the importance of being realistic from the beginning.  If you have a property and are unsure of its current value, please contact our sales director Adrian McCarthy. 

Email: Adrian.mccarthy@upp-property.co.uk. or please call Adrian on 01572 725 825

We look forward to discussing property with you.


David Crooke

Managing Director
UPP Property Agents & Author of The Rutland and Stamford Property News

Call: 01780 484 554

Twitter: @UPPproperty  

LinkedIn: David Crooke

www.upp-property.co.uk