Sunday, 16 January 2022

What Will Happen to Royal Tunbridge Wells House Prices in 2022?

Traditionally, if you had not sold your Tunbridge Wells home by the first week in November, you would normally have to wait for the house sellers to return in the famous Boxing Day rush on the portals (Rightmove, Zoopla etc) to get potential buyers interested.

Yet matters have been different this year as the various lockdowns have caused a surge in house buying right up until when the Christmas edition of the Radio Times goes on sale.


So, the question is, how will 2022 look regarding the Tunbridge Wells property market?


The last couple of years in the local property market have been different in many ways. So much so, many Tunbridge Wells homeowners are presently deliberating whether they should put their home on the market in January or wait until later in the summer.


Speaking to many Tunbridge Wells buyers and sellers, (and in fact Tunbridge Wells buy-to-let landlords) in the last couple of weeks in the run-up to Christmas, many were asking the very same question.


What is going to happen to Tunbridge Wells house prices in 2022?


Some people asking this question are local buyers troubling themselves that they are about to buy their Tunbridge Wells home just before a potential property crash, yet others are homeowners wanting to know where the top of the market is before they sell. Even a handful of Tunbridge Wells landlords unable to either start buying or start selling some of their rental portfolio.


Therefore, let’s see what has happened in 2021 to make a better judgement of what should happen in 2022.


Nobody has a crystal ball that can tell what 2022 holds, however most property experts are not forecasting doom and gloom for the British property market.


Whilst the final numbers won’t be known until Easter 2022, it is estimated that in 2021 one in fifteen privately owned homes in the UK are expected to have changed hands, being the busiest year in the last 14 years. Locally,


1,042 properties have changed hands in the last year

in Tunbridge Wells 


Although that is only up to October 2021, so numbers will be much higher once all the final counts are in by March/April.


The pandemic made many Tunbridge Wells families re-evaluate what they wanted from their Tunbridge Wells home, with many wanting bigger rooms (and more of them). Many in the press dubbed this ‘the race for space’, meaning the property market was flooded with home buyers, most bringing forward the home move they had planned between now and 2025.

The issue was, there weren’t enough Tunbridge Wells properties on the market to satisfy every Tunbridge Wells buyer, meaning house prices have unsurprisingly been driven up.

 

The average price of a home today in Tunbridge Wells is £520,400


Although it is still premature to say what will happen in 2022, most property commentators seem assured that we are not heading towards a house price crash, mainly due to one reason.


There aren’t enough properties on the market in Tunbridge Wells. Simply supply and demand economics!


The property crash in 2008 was caused by everyone dumping their property on the market.


In January 2007, there were 873 properties for sale in Tunbridge Wells, one year later in January 2008, that had risen to 1,305 properties, whilst today, that stands at 388


And I can’t see that changing for 2022.


In 2007, mortgage interest rates were 6.5% to 7.5%, so when the economy started to falter, everyone looked to sell their homes to reduce their outgoings as unemployment rose by over 60% in just a couple of years. This time round most people have mortgage rates of around 2% to 2.5% and unemployment is dropping, meaning they don’t need to sell their Tunbridge Wells home.


Now of course the stamp duty tax holiday came to an end months ago, and Bank of England base interest rates are expected to rise moderately in the coming year, yet not to the level they were in 2007 (5.75%).


Nonetheless, demand for Tunbridge Wells homes will still be there. I have even read some reports suggesting that more than 20% of British households are seriously thinking of moving between now and the summer of 2023, and this will support Tunbridge Wells house prices whilst demand continues to exceed supply.


Tunbridge Wells house prices will be 4.4% higher by

the end of 2022


Another reason why I believe that will be the case is the return to home working. If, as a country, we will need to work from home each winter for the foreseeable future because of new variants, then this will cement the need for people wanting to move home for remote working. 


It might be that Tunbridge Wells buyers are looking for a dedicated office at home or that they feel they now no longer need to be in large built-up areas that are near to their work. 


This increase in Tunbridge Wells house prices is expected to entice even more Tunbridge Wells house sellers onto the market, which will steady local house prices slightly (as supply increases), yet I still believe there won’t be enough properties coming onto the market to satisfy the colossal demand.


What about the Tunbridge Wells rental market?


Rents tend to grow in line with tenants’ wages. So, with many people getting decent pay rises and not enough properties being built, many economists are suggesting rents will be 14% to 19% higher by 2027. Even with the house price growth, the numbers for rental investments still look rosy.


Is it the right time to buy your first property in Tunbridge Wells?


This rise in Tunbridge Wells house prices has had many people asking whether 2022 is the right time to buy their first home? Should they buy now before Tunbridge Wells prices rocket even further or delay in the hope that house prices come back down? 


As with any important decision in life, this will mainly depend on your own personal life and your motives for wanting to move. 


If the Tunbridge Wells home that you want to buy is on the market, available and you can afford the mortgage, then delaying could be detrimental. It’s like holding off for the ‘next generation TV’, it then coming out; then just as you are about to buy the TV, the next ‘next generation TV’ gets announced for six months’ time ... and the cycle is constantly in motion – so you end up never buying a TV … just like you will never buy your own home!


Buying property is a long-term game


Sometimes you just have to make your decision, get something bought and start the journey of the next 25 to 35 years of living in your family home whilst paying off your mortgage.


The present low interest rates for first-time buyers means that there are some very low mortgage deals available for those with a decent deposit, making it a good time to buy a Tunbridge Wells property, especially if you fix the interest rate.


If your deposit is humbler, the Government’s 5% deposit mortgage guarantee scheme will still enable you to buy a property, albeit at a slightly higher interest rate.


Looking at the bigger picture, these are only my opinions. If inflation doesn’t get too out of hand and interest rates don’t go above 2% to 3%, it looks like Tunbridge Wells house prices will, for 2022 and a few years beyond, continue upwards albeit with a slower trajectory than 2020/21 and probably with a few short, sharp up and down spikes on the way.


The bottom line is, ensure that any Tunbridge Wells house move that you intend to make is something that you can afford, allow for future rises in interest rates and make plans for as many eventualities as possible. Do that, and you should be just fine.


These are my opinions – what are yours?

Thursday, 9 December 2021

Should Landlords be worried about these new rental regulations?

Everyone should be doing their bit to help reduce the UK’s carbon footprint on the globe – yet the question is, is that burden being put too much on the shoulders of landlords with potential bills of £7,600+ in the next four years?

The background - the UK has obligated itself to a legally binding target to be carbon neutral by 2050. One of the biggest producers of greenhouse gasses is residential homes. 


To hit that carbon-neutral target (as one-fifth of the UK's carbon output comes from residential property), every UK home will need to achieve a minimum grade of ‘C’ on their Energy Performance Certificate (EPC) by 2035. Each EPC has a rating between ‘A’ and ‘G’ - 'A' being the best energy rating and 'G' the worst – like an energy rating on a fridge or washing machine.


All UK rental properties have required an EPC. Yet, from April 2020, the Minimum Energy Efficiency Standards (MEES) regulations have required all private rental properties (including rental renewals) to have a minimum EPC rating of ‘E’ or above. 

Yet new legislation being discussed by the Government’s Climate Change Committee has suggested that landlords should play their part and increase the energy efficiency of their private rented homes. Sounds fair until you dive into the details.

The Government is muting the idea that all new tenancies (i.e. when a new tenant moves in) in private rented properties should be at an EPC rating of 'C' or above by 2025 (and all existing tenancies by 2028). The issue is …


70.63% of all private rented properties in

Tunbridge Wells have an EPC rating of ‘D’ or below.


The problem is some of our local landlords will find it very expensive, neigh impossible, to improve the energy efficiency of their rented properties, especially those landlords who hold older housing stock such as terraced properties built in the 1800s. These Victorian terraced houses never perform well on EPC ratings as they have solid walls.  

Now, of course, you can improve the EPC rating of a terraced house by improving roof insulation, boiler replacement, solar heating, and high-grade uPVC windows. Yet, with some terraced houses, there will come the point where you will be unable to get to the haloed 'C' rating without installing external or internal wall insulation, sometimes even floor insulation.

With wall insulation costing between £5k and £15k and floor insulation around £5k …


the bill to improve all Tunbridge Wells’ private rented

properties will be a minimum of £40,560,760.


But before I talk about what the options are for landlords, here’s the weird part of EPCs. An EPC rating is calculated on the cost of running a property and not the carbon output or energy efficiency, despite its name. 


My advice to Tunbridge Wells landlords - although it’s correct to create a future strategy, all I can say at this point is 'more haste less speed'. These rule changes are only a discussion paper, and it remains open for consultation by any member of the British public until 30th December 2021. That means the Government's strategies and tactics may change. 


Given that 57% of private rented properties are below a ‘C’ EPC grade, it is hard to believe the Government could achieve this without making big cash grants available.


For example, there is presently a cap of £3,500 for energy improvements that Tunbridge Wells landlords have to spend to get it to the existing EPC ‘E’ target grade on private rented homes (i.e. if you have a privately rented home at an 'F' or 'G' EPC rating, you only need to spend a maximum of £3,500 as a landlord on improving your EPC rating and still being legal even if those £3,500 don't get you to the current 'E' rating minimum). So, if the current rules allow an exemption to the EPC renting rules, if a Tunbridge Wells landlord can’t improve their Tunbridge Wells property enough, conceivably, could this be extended?


So, what are Tunbridge Wells landlord’s options?


One thing you could do is put your head in the sand and hope it all goes away!


Another thing some savvy landlords do (be they my client, clients of other letting agents in Tunbridge Wells or even self-managing landlords) is to sit down and plan a strategy for their rental portfolio. I print off all the EPCs of their rental portfolio, look at the recommendations, then discuss a plan to ensure they are covered whatever the Government decides to make the new EPC rules. Like all things in life, plan for the worse and hope for the best.


If your agent isn't offering that service, please drop me a line because I would hate for you to miss out on the advice and opinion that so many Tunbridge Wells landlords have already had from me.  


Sunday, 5 December 2021

With Royal Tunbridge Wells Tenants Deposits Totalling £7,065,960, How Will ‘Lifetime Deposits’ Change the Local Rental Market?



The Government’s scheduled publication of their White Paper for the Renter's Reform Bill, which incorporates proposals to forbid Section 21 evictions and introduce ‘Lifetime Deposits’, has been suspended until 2022. 

The additional time is required to give a chance to create a level playing field to reforms for both landlords and tenants in the private rented sector in England.


In this article, I want to look at these lifetime deposits. How could the Lifetime Deposit Scheme work, and how could they benefit both landlords and tenants? 


When a tenant moves between rented homes, they need the deposit for their new home before being released from their old home. 

The average deposit for a Tunbridge Wells rented home stands at £1,320

This means finding that amount of money at the time of moving home can be difficult for many tenants; thus, they become stuck in their existing rental.

Therefore, Westminster wants to propose in this White Paper a new deposit choice for tenants. A deposit is transferred from the old landlord (letting agent) to the new landlord (letting agent), thus making life simpler as the tenant doesn't need to save for an additional new deposit every time they move home.

Now, of course, it's vital that any new ‘deposit scheme’ does not dissuade Tunbridge Wells landlords from making valid claims for damage to properties. Landlords cannot be expected to give up their right of recourse to a security deposit until such time that they are satisfied there will be no need to claim it.   

So how would Lifetime Deposits work?

There would need to be some form of system safeguarding that the new landlord is protected by a whole deposit, even if the deposit on the old home comes into dispute. 

This will be critical and central to landlords having conviction in the Lifetime Deposit Scheme. That could be something like an interest-free loan for the tenant on the crossover between the properties.

Another advantage to the scheme is that ‘lifetime deposits’ could be used for tenants to build a deposit for a house for the future.

What about the existing system of deposits?

The rules regarding the amount of deposit held by a landlord were changed a couple of years ago, where only five weeks’ worth of rent can be held as a deposit. 

The deposits tenants have had to save for certainly raises the cost of renting a home. 

Some say this extra burden puts another nail in the coffin of the dream of homeownership for many local renters. To give you an idea of the level of deposits held for Tunbridge Wells rental properties …

The total of all the tenants’ deposits in Tunbridge Wells is £7,065,960.

Yet the other side of the argument contends that if the Tunbridge Wells tenant misses more than one month’s worth of rent, the landlord is immediately out of pocket, even before they’ve got the costs of solicitors and any improvement works from the tenant trashing the place.

Does a deposit of just over one month provide Tunbridge Wells landlords with a decent level of protection against unpaid rent or damage to the property? When you consider …


The total value of all the privately rented properties in Tunbridge Wells is £2,819,157,450


Before I conclude my thoughts to the initial question of ‘lifetime deposits’, the need for decent landlord insurance to ensure you are adequately covered as a Tunbridge Wells landlord is vital. 


So, what are my thoughts on ‘Lifetime Deposits’?


It is my opinion the common need for Tunbridge Wells tenants to stump up a ‘two-fold deposit’ is not helping many renters when moving home. It’s clear the standard cash down deposit is not fit for purpose for the 21st Century. 


One might suggest the Government’s quest for the ‘lifetime deposit’ could open the door to other deposit alternatives that have come onto the market for tenants in the last few years. 


Some landlords don’t require a deposit yet are compensated by asking the tenant to pay a higher rent to cover the risk. Also, there are companies that offer insurance backed deposits where the tenant pays one week's rent to an insurance firm, and the insurance firm pays out if a loss is incurred by the landlord.


Interestingly, other countries are already offering deposit loans and guarantee schemes. Could this be something for the British Government to contemplate?


We must wait until at least the spring of 2022 for the Renter’s Reform White Paper to be published. Then every stakeholder involved (tenants, landlords and agents, et cetera) can look at it in the cold light of day and decide how this will affect the way they view the landlord/tenant/agent relationship.


Many will say the bigger issue isn’t ‘Lifetime Deposits’ in the White Paper, but the removal of no-fault Section 21 evictions. The removal of Section 21 is something the current Government have pledged to bring in during this parliamentary cycle (i.e. before Q4 2024).  

I am not concerned about removing no-fault Section 21 evictions, but what will replace it to ensure there is suitable redress for landlords if the tenant doesn't pay the rent?

Of course, a handful of Tunbridge Wells landlords will decide to sell their rental portfolio because of the White Paper. The same happened in 2016 when the increase in landlord taxes were announced.  

However, this will reduce the supply and availability of Tunbridge Wells rental properties, meaning rents will rise (classic textbook supply and demand), thus, landlords return and yields will rise.



Yet, because tenants still can’t afford to save the deposit for a home and we are all living longer, the demand for rental properties across will continue to grow in the next twenty to thirty years. The reason being we are still not building enough homes to accommodate our growing and ageing population. This means we will turn to more European ways where the norm is to rent rather than buy in their 20s and 30s. 

This means new buy-to-let landlords will be attracted into the market, buy properties for the rental market in Tunbridge Wells and enjoy those higher yields and returns. Isn't it interesting that things mostly always go full circle?



Saturday, 13 November 2021

Would You Re-Mortgage Your Royal Tunbridge Wells Home to Help Your Child onto the Property Ladder?

How far would you go to help your child get on in the world?

Many Tunbridge Wells parents move area to ensure their child gets into the best primary school or fund their university costs. Many of you reading this have even helped your children with the deposit for their first home from savings.

However, I have come across many Tunbridge Wells people in their 50’s and 60’s, who have good jobs and incomes, yet don’t have the savings to give to their children to help them buy their first home. It doesn’t help when you consider …

The average value of a Tunbridge Wells home has risen by 12.1%

in the last 5 years, from £468,635 to £525,200.

I am therefore seeing increasing numbers of parents who are willing to re-mortgage their own Tunbridge Wells home or start a new mortgage (when they own their home outright) — to get their children onto the Tunbridge Wells property ladder.

So, whilst the Government is trying to turn Britain’s 20 and 30 somethings from ‘Generation Rent’ into ‘Generation Buy’, the Bank of Mum and Dad are mortgaging their retirement to pay for it all. Yet it need not be cost prohibitive borrowing the deposit as you still have access to interest only mortgages.

With an interest only mortgage, your monthly mortgage payment covers only the interest on your mortgage, not any of the original capital borrowed. This means your mortgage payments will be lower than on a repayment mortgage, remembering though at the end of the term you will still owe the original amount you borrowed from the mortgage provider.

1 in 14 new mortgages are interest only and 1 in 5.5 existing mortgages are interest only mortgages, they are very popular.

Anyway, many Tunbridge Wells homeowners might be worried about having that level of debt in their golden years. However, many plan to pay off the mortgage when they downsize as they get into their 60’s and 70’s.

I talk to many Tunbridge Wells homeowners, who are asset rich but cash poor and desire to help their children onto the Tunbridge Wells property ladder. Their attitude is their children will inherit their property when they pass away, so it seems practical to give them that money to work harder for them earlier in their life when they need it to buy their first home.

Can you get a mortgage, even if you are retired?

A lot is dependent upon your age and financial position. The mortgage companies will see if you have adequate funds for your retirement and emergencies plus leaving enough equity in the property to enable you to downsize in the future. Like all things, you need to take advice from a qualified mortgage arranger.

So, that then begs the question, is there enough equity in Tunbridge Wells homes to borrow against?

In the late 1980s and again in the early 2000s, many Brits saw their homes as a cash machine. Numerous homeowners re-mortgaging at the end of their mortgage’s preliminary term (usually after the initial 2, 3 or 5 years), but when doing so increased their mortgage to enable them to buy a nice car or fancy holiday. Yet, by increasing the borrowing, it created negative equity in the early 1990s and stopped many homeowners moving home between 2009 and 2013 because of their lack of equity.

Therefore, I have to ask, have we borrowed too much this time round?

Looking at Tunbridge Wells and the specific postcodes TN1, TN2, TN3 and TN4 combined ...

In 2016, the average Tunbridge Wells homeowner had a mortgage of £169,506 and today it is £213,789, a rise of £44,283.

Looking at these numbers, one might think we are again over-extending ourselves, yet as regular readers of my blog about the Tunbridge Wells property market will know – I like to drill down and look at all the figures.

Initially, I was worried about these stats, until I considered the equity Tunbridge Wells people have amassed over the same 5 years.

In 2016, the average equity held in a Tunbridge Wells homeowners’ property (whilst still having a mortgage) was £299,129, yet today that stands at £311,411, a rise of £12,282.

Even though mortgages have increased, Tunbridge Wells homeowner’s equity has risen even more, meaning as we stand today, mortgaged and owned-outright properties, there is …

£15,936,969,530 of equity held in all Tunbridge Wells homes.

Whilst the total value of mortgages has increased slightly since 2016, as a percentage, this has gone down meaning Tunbridge Wells homeowners and Tunbridge Wells landlords have increased their equity in the last five years.

It can quite clearly be seen that the financial insecurity sparked by the Credit Crunch crisis of 2008/9 has created a generation of Tunbridge Wells homeowners and landlords who are savers and improvers rather than movers and excessive borrowers, using excess cash to invest in their property and pay down debt or to excessively borrow on their equity growth.

Only 15.85% of the total value of Tunbridge Wells property

is borrowed money with a mortgage.

This is great news for every Tunbridge Wells homeowner and landlord because irrespective of whether the ‘Post Lockdown Bounce’ is short or long-lived, it shows the Tunbridge Wells property market is in a better state to ride out any storm that it might encounter than ever before because less people will be in negative equity or have prohibitively high mortgages.

Before I finish, I fully appreciate money and inheritance is a sensitive subject for many families.

My message to all the Tunbridge Wells parents is, just because your children aren’t talking about the subject, it doesn’t mean it’s not on their mind.

The lead has to come from you, as a Tunbridge Wells parent, to ensure the wealth held in your bricks and mortar can be used to your family’s advantage, when they need it most.

If you do, your children will thank you for it and they may even do exactly the same for their children, then, they will do the same for their children’s children ... creating a legacy that will go on for generations.

Wednesday, 10 November 2021

Has Buy-to-Let Changed the Royal Tunbridge Wells Property Market?

 

The ‘Buy-To-Let’ Mortgage is celebrating its Silver Anniversary (25 years) this autumn. 

Isn’t it fascinating that a decision between a group of letting agents and bankers all that time ago to offer ‘Buy-To-Let’ (BTL) mortgages has changed the face of the Tunbridge Wells (and national) property market?


But has it been a good thing? Or has it ruined the dreams of many 20 somethings wanting to get on to the property ladder in the last couple of decades?


Let’s look deeper at the whole story, then I will let you, the reader, decide.


As soon as the BTL mortgage was launched, it was clear there was an enthusiasm and a need for this mortgage product. So much so the size of the Tunbridge Wells private rented sector has grown exponentially.


According to my analysis…


there are 5,353 private rented homes in Tunbridge Wells,

worth £2,888,639,000.


So now we are in 2021, it seems farcical that banks and building societies once thought that properties rented out to private tenants would not create a steady income or increase in value, yet this thought was conventional back in the 1990s. 


It’s no wonder BTL landlords have been given a hard time, with numbers like this. 


Yet before we burn every landlord at the stake,
let’s just look at the background story.


The Conservatives introduced the right of a council house tenant to buy their own council house in the early 1980s. Fantastic news for council tenants, yet when a council tenant bought their home, that meant that council housing was taken away from future generations to rent and therefore eroding the council housing stock available. Meaning from the mid 1990s /early 2000s, people who would normally be eligible to rent from the council, yet who couldn’t buy, had only one option … rent from a private landlord.


Meanwhile, in the early/mid 1990s we had 15% mortgage interest rates, unemployment rates of 9% and the 1989 housing crash fresh in people’s memories. Repossessions were rife, making home ownership not the most attractive prospect for 20 somethings. 


Tunbridge Wells house prices dropped by
30.7% between 1989 and 1993.


This meant as we entered the mid 1990s, the local property market entered a period of stagnation. There were many Tunbridge Wells homeowners that bought their home in the property boom of the late 1980s who were disinclined to sell their home for a loss. They were in negative equity (i.e. they owed more than what the house was worth) yet needed to move because of their growing families. 


Renting their home out could have allowed them to buy another home for their growing family, but most banks and building societies were still mostly unreceptive to the notion of these homeowners becoming accidental landlords. Most mortgage terms and conditions usually included clauses that prohibited homeowners from renting out their homes. 


So, with growing demand from potential tenants, supply reduced from the sale of council houses and many homeowners in negative equity, all bound up by the semi-deregulation of the private rented sector with the Housing Act 1988 – you can see that the BTL mortgage came along at the right time.


Early take up of BTL mortgages was slow in the first couple of years.


By the Millennium, according to the Council of Mortgage Lenders, there were just over 120,000 BTL mortgages, with a total value of £9.1 billion.


Yet as we entered the 2000s, they really took off, with every man and his dog jumping onto the BTL bandwagon. So much so that today in the UK, there are…


4.4m private rented homes, 2.1m of them with BTL mortgages
 totaling £234.1bn, which is 11.9% of the UK’s GDP!


That’s more than a 1,650% increase in the number of BTL mortgages to landlords and a 2,470% increase in the value of those BTL mortgages. 


Since 2001, the number of privately rented households in the UK has grown from 8.3% to 19%.


On the face of it, you could say with the growth of these BTL landlords with their cheap BTL mortgages and often unkempt properties, it has pushed potential homebuyers into squalor. Yet, let’s look a little deeper.


Most Tunbridge Wells landlords are very fair with their tenants providing them with clean, well presented and affordable housing. Of course, there are the rogue landlords but with TV shows such as ‘Landlords from Hell’, the British public are given a distorted and uneven view of private landlords as a whole.

Private sector landlords have played a critical role in providing homes to millions of Brits in this country, let me expand.

The UK population has grown by 405,000 people per year (for the last 20 years), yet only 22,750 council/social houses have been built per year in the same time frame.


If it wasn’t for the rented sector, who would have housed all the extra people in the country over the last 20 years?  


What about the exorbitant rents? Would it surprise you that rents have risen below inflation between 2008 and 2019? 


Also there has been a drive to tax BTL landlords more comprehensively and regulate the private rented sector to develop better housing conditions 
for tenants.


Unlike owner-occupier homes, tenants get the benefit of new regulations from Gas Safety Checks and Electrical Safety Reports. Also, BTL landlords will need to improve their Energy Performance Certificate Rating to at least a C rating by the end of 2025 for all new tenancies, and by end of 2028 for all existing tenancies, all at no cost to the tenant and directly saving them money on their heating costs – something that is very important considering the recent rises in gas prices. 


Tunbridge Wells landlords have also had to pay more tax on their BTL properties, paying 3% Stamp Duty tax supplement for the last 5 years, and higher rate tax relief on mortgage interest was taken away four years ago.


Landlords have also had to deal with the financial fallout of the pandemic. It is estimated 1 in 5 tenants in the private rented sector have some form of rent arrears. 


Interestingly landlords that don’t use a letting agent to manage their property are 272.5% more likely to be 2 months or more in arrears.


Also, evictions for rent arrears were banned during the pandemic, meaning some tenants ran up arrears of 12 months or more. According to the National Residential Landlords Association (NRLA), this has left around 210,000 private tenants in the country facing a court order for rent arrears. That would equate to…


287 Tunbridge Wells private rented households
with a court order for arrears.


The idea that Tunbridge Wells landlords are middle-class establishment types who are out to take advantage of tenants who can’t afford to buy their own homes is, in my opinion, just wrong.


Of course, there are some rogue landlords, yet there are plenty of rogue tenants. Just because you are a landlord in the area, it doesn’t mean you are quaffing champagne and rolling in cash.


961 Tunbridge Wells landlords own just one BTL property.


And just under half of those use their rental income to supplement their pensions, and according to the NRLA, a third of landlords have a gross income (excluding income from the BTL property) of less than £20k per annum.


It’s hard work being a Tunbridge Wells BTL landlord and I still believe the burden of housing just under a fifth of the UK population isn’t appreciated or taken seriously by Government.


Notwithstanding the challenges, most BTL landlords are in it for the long run. BTL mortgages can be secured for less than 1% and demand is on the rise (with rents rising at the highest rate for 10+ years). Of course, Brexit caused a few issues with some  landlords losing some Eastern European migrants. Yet once things settle down, we will have an influx of people coming from Hong Kong and Afghanistan, wanting to settle down, get jobs and ultimately require a home to live in, which will be a private rented house.


I know the Stamp Duty tax holiday has cleared out the landlords who were on the fence for staying in the private rented sector or selling up, but those landlords that are left will be more professional and will run their BTL portfolio as a business, not a hobby.


My final piece of advice to anyone thinking of becoming a BTL landlord in Tunbridge Wells for the first time is that you have to have a strategy and plan ahead. Those who stumbled into the BTL market in the early 2000s made a lot of money without any strategy or tactics. 


Moving forward you need the guidance and support of an agent who can tell you the best places for investment, be that for better yield or better capital growth. 


They will also be able to tell you what tenants demand to ensure that you attract the right sort of tenants who won’t trash the place and leave you in arrears. If you would like some advice, do not hesitate to drop me a line or pick up the phone.