Thursday, 28 July 2016

Population in the Royal Tunbridge Wells area set to rise to 131,000 by 2036

Royal Tunbridge Wells faces a predicament. The population is growing and the provision of new housing isn’t keeping up. With the average age of a Royal Tunbridge Wells person being 39.6 years (compared to the South East average of 40.0 years old and the national average of 39.4 years of age), the population of Royal Tunbridge Wells is growing at an alarming rate. This is due to an amalgamation of longer life expectancy, a fairly high birth rate (compared to previous decades) and high net immigration, all of which contribute to housing shortages and burgeoning house prices.

My colleagues and myself work closely with Durham University and they have kindly produced some statistics specifically for the Tunbridge Wells Borough Council area. Known as the UK’s leading authority for such statistics, their population projections make some startling reading…

For the Tunbridge Wells Borough Council area ... these are the statistics and future forecasts

2016 population           117,140
2021 population           120,511
2026 population           124,121
2031 population           127,533
2036 population           131,092

The normal ratio of people to property is 2 to 1 in the UK, which therefore means...

We need just under 7,000 additional new properties to be built
in the Tunbridge Wells Borough Council area over the next 20 years.

Whilst focusing on population growth does not tackle the housing crisis in the short term in Royal Tunbridge Wells, it has a fundamental role to play in long-term housing development and strategy in the town. The rise of Royal Tunbridge Wells property values over the last six years since the credit crunch are primarily a result of a lack of properties coming onto the market, a lack of new properties being built in the town and rising demand (especially from landlords looking to buy property to rent them out to the growing number of people wanting to live in Royal Tunbridge Wells but can’t buy or rent from the Council).

Although many are talking about the need to improve supply (i.e. the building of new properties), the issue of accumulative demand from population growth is often overlooked. Nationally, the proportion of 25-34 year olds who own their own home has dropped dramatically from 66.7% in 1987 to 43.8% in 2014, whilst 78.2% of over 65s own their own home. Longer life expectancies mean houses remain in the same hands for longer.

The swift population growth over the last thirty years provides more competition for the young than for mature population.  It might surprise some people that 98% of all the land in the UK is either industrial, commercial or agricultural, with only two percent being used for housing, which means one could propose expanding supply to meet a expanding population by building on green belt – that most Politian’s haven’t got the stomach to tackle, especially in the Tory’ strongholds of the South of England, where the demand is the greatest. People mention brownfield sites, but recent research suggests there aren’t as many sites to build on, especially in Royal Tunbridge Wells that could accommodate 7,000 properties in the next 20 years.

In the short to medium term, demand for a roof over of one’s head will continue to grow in Royal Tunbridge Wells (and the country as a whole). In the short term, that demand can only be met from the private rental sector (which is good news for homeowners and landlords alike as that keeps house prices higher).

In the long term though, local and national Government and the UK population as a whole, need to realise these additional millions of people over the next 20 years need to live somewhere. Only once this issue starts to get addressed, in terms of extra properties being built in a sustainable and environmentally friendly way, can we all help create a socially ecological prosperous future for everyone. For more thoughts on the Royal Tunbridge Wells 

Saturday, 23 July 2016

99 days to find a buyer for your Royal Tunbridge Wells Property

I had a homeowner from High Brooms email me the other day. She said she had been following my blog (the Royal Tunbridge Wells Property Market Blog) for a while and wanted to pick my brain on when is the best time of the year to sell a property. Trying to calculate the best time to put your Royal Tunbridge Wells property on the market can often seem something akin to witchcraft and, whilst I would agree that there are particular times of the year that can prove more productive than others, there are plenty of factors that need to be taken into consideration.

Even if you are putting your property on the market, you don’t know how long it will take to find a buyer - no crystal ball to help with that one. At the moment, the latest set of figures for all 41 estate agents in Royal Tunbridge Wells, show the average length of time it takes to find a buyer for any Royal Tunbridge Wells property is as follows ..

Detached                    102 days
Semi                              71 days
Terraced                     122 days
Flat                              112 days
Overall average            99 days

If we roll the clock back to January 2016, the overall average time it took to find a buyer (again using data from all of the 41 Royal Tunbridge Wells Estate Agents) was 102 days.

So, on the face of it, things haven’t changed a great deal over the last six months or so. But, when I looked at the data going back to 2009, and every Spring since then, the average length of time it takes to sell a property drops between January and the Summer months, for it to rise on the run up to Christmas. For example ..

Winter 2009 - 158 days          Summer 2009  - 151 days

and in more recent times …

Winter 2013 - 128 days          Summer 2013  - 122 days
Winter 2014 - 122 days          Summer 2014  - 98 days
Winter 2015 - 102 days          Summer 2015  - 86 days
Coming back to the present, even if you placed your property on the market today in Royal Tunbridge Wells, if it takes you on average a little over fourteen weeks to find a buyer, then you can expect solicitors and the chain to take an additional eight and twelve weeks after that, before you move. It comes down to personal choice as to when you place your property on the market. Children often affect the decision. On one side you might delay putting that for sale board in your front garden so you can move in the summer school holidays, but on the other side, you might want to move sooner to be in the catchment area of a preferred school, in plenty of time for the next academic year?

There are times of the year when it's better to sell, and times when waiting a little longer can pay off in the long run. In a nutshell, I would say this is the way of the seasons ..


Spring: Customarily there are more house-buyers as the Daffodils show themselves
Summer: Sellers may miss out on house-buyers being on holiday
Autumn: The enthusiasm for buying homes returns
Winter: Interest diminishes as festive period looms 

What this means to buyers and landlord investors is that they often pick up a bargain in later months of the year, as there is less competition from owner occupiers. So, whilst there are better months to achieve a quicker sale, the only piece of advice I can give to every home  owner and landlord in Royal Tunbridge Wells, is do the right thing for yourself, do your homework and buy (and sell) with both your head as well as your heart

Saturday, 16 July 2016

164% increase in Property Values in Royal Tunbridge Wells since the Millennium

Royal Tunbridge Wells house prices since the Millennium have risen by 164.75%, whilst average salaries in Royal Tunbridge Wells have only grown by 51.27% over the same time frame. This has served to push homeownership further out of reach for many Royal Tunbridge Wells people as they have to battle against raising considerable deposits and meet sterner lending criteria, as a result of new mortgage regulations introduced in 2014/5.  The private rental market in Royal Tunbridge Wells has grown throughout the last twenty 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 Tunbridge Wells Constituency, roll the clock back 20 years and there were 35,352 properties in the Constituency, whilst the most recent set of figures show there are 43,410 properties - a growth of 8,058 properties.

However, anecdotal evidence suggests that a large number of those 8,058 were bought by Royal Tunbridge Wells buy-to-let landlords, as over the same 20-year time frame, the number of rental properties has grown from 3,972 to 7,524 in the Constituency - a rise of 3,552 properties.

Nevertheless, some say this historic growth of the Royal Tunbridge Wells 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.

You see, from my point of view, I don’t think things will get worse in the buy-to-let market in Royal Tunbridge Wells and these are the reasons why I believe that:

Firstly, what else are Royal Tunbridge Wells 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 164.75% rise in Royal Tunbridge Wells 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 Royal Tunbridge Wells: the stock of property for sale being at a six year all time low.

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