Friday 31 March 2017

Royal Tunbridge Wells First Time Buyers borrow £62.3m in the last 12 months

Starting with the bigger picture, over the last 12 months in the UK, 1,061,557 properties were sold with a total value of £223.74 bn. To give that some context, ten years ago 1,581,727 properties sold with a total value of £405.56bn, so it can be seen the number of people moving house has dropped by over a third over the last decade.

Whether you are a landlord, homeowner or tenant, it’s always important to keep an eye on the Royal Tunbridge Wells property market, not just from your point of view, but also from every player’s point of view. Over the last 12 months, 1,297 properties have sold (and completed) in Royal Tunbridge Wells, worth £561.4m. Interestingly the number of properties changing hands in Royal Tunbridge Wells has also dropped when compared to a decade ago.

It might surprise you that first time buyers in 2017 will benefit from a slight decline in Royal Tunbridge Wells buy-to-let investors.

Those looking to buy a home in the spring and summer of 2017 will face a far less competitive Royal Tunbridge Wells property market than the same time of year in 2016, when the urgency to beat the buy-to-let stamp duty hike was in full swing.  

Many landlords brought forward their purchases to beat the tax, and since then, the number of buy-to-let purchases has dropped slightly. First time buyers have taken advantage of that and have increased their buying. In fact, looking at the Bank of England figures, this is what UK lenders have lent on buy-to-let properties versus first time buyers over the last 12 months 

Q4 2015 - £1bn buy-to-let mortgages vs £1.31bn for first time buyers
Q1 2016 - £1.35bn buy-to-let mortgages vs £1.08bn for first time buyers
Q2 2016 - £760m buy-to-let mortgages vs £1.28bn for first time buyers
Q3 2016 - £827m buy-to-let mortgages vs £1.42bn for first time buyers

When looking at the figures for Royal Tunbridge Wells itself, first time buyers have borrowed more than £62.3m in the last 12 months to buy their first home. This is a ringing endorsement of their confidence in their jobs and the local Royal Tunbridge Wells economy. Those 20 and 30 something’s who are considering being first time buyers in 2017 will find that the number of properties on the market has never been as good as it has for quite a while, meaning you have more choice of properties and less competition from so many buy-to-let landlords than a year ago.

Rightmove announced nationally that new seller enquiries are 26% up on the same time last year giving the stoutest indication that we may see a slight ease in the lack of properties on the market. When I look at Royal Tunbridge Wells, at this moment in time there are 396 properties for sale, compared to 352 properties a year ago. All this will be welcome news amongst Royal Tunbridge Wells first-time buyers with a combination of a proportional reduction in new investors and landlords.

2017 will be an interesting year for all homeowners, be they buy-to-let landlords, existing homeowners or future homeowners. 

Saturday 25 March 2017

With 10,874 people in Private Rented Properties in Royal Tunbridge Wells - Should you still be investing in Royal Tunbridge Wells Buy To Let?

If I were a buy to let landlord in Royal Tunbridge Wells today, I might feel a little bruised by the assault made on my wallet after being (and continuing to be) ransacked over the last 12 months by HM Treasury’s tax changes on buy to let. To add insult to injury, Brexit has caused a tempering of the Royal Tunbridge Wells property market with property prices not increasing by the levels we have seen in the last few years. I think we might even see a very slight drop in property prices this year and, if Royal Tunbridge Wells property prices do drop, the downside to that is that first time buyers could be attracted back into the Royal Tunbridge Wells property market; meaning less demand for renting (meaning rents will go down). Yet, before we all run for the hills, all these things could be serendipitous to every Royal Tunbridge Wells landlord, almost a blessing in disguise.

Royal Tunbridge Wells has a population of 57,061, so when I looked at the number of people who lived in private rented accommodation, the numbers astounded me …

Royal Tunbridge Wells - Accommodation Type and the Number of Occupiers
Owned outright - Royal Tunbridge Wells
Owned with a mortgage - Royal Tunbridge Wells
Shared ownership (part owned and part rented) - Royal Tunbridge Wells
Social rented (aka Council Housing) -  Royal Tunbridge Wells
Private rented - Royal Tunbridge Wells
Living rent free - Royal Tunbridge Wells
57,061
14,122
22,447
505
8,670
10,874
24.7%
39.3%
0.9%
15.2%
19.1%
0.8%

Yields will rise if Royal Tunbridge Wells property prices fall, which will also make it easier to obtain a buy to let mortgage, as the income would cover more of the interest cost. If property values were to level off or come down that could help Royal Tunbridge Wells landlords add to their portfolio. Rental demand in Royal Tunbridge Wells is expected to stay solid and may even see an improvement if uncertainty is protracted. However, there is something even more important that Royal Tunbridge Wells landlords should be aware of: the change in the anthropological nature of these 20 something potential first time buyers.

I have just come back from a visit to my wife’s relations after a family get together. I got chatting with my wife’s nephew and his partner.  Both are in their mid/late twenties, both have decent jobs in Royal Tunbridge Wells and they rent. Yet, here was the bombshell, they were planning to rent for the foreseeable future with no plans to even save for a deposit, let alone buy a property. I enquired why they weren’t planning to buy? The answers surprised me as a 40 something, and it will you. Firstly, they don’t want to put cash into property, they would rather spend it on living and socialising by going on nice holidays and buying the latest tech and gadgets. They want the flexibility to live where they choose and finally, they don’t like the idea of paying for repairs. All their friends feel the same. I was quite taken aback that buying a house is just not top of the list for these youngsters.


So, as 19.1% of Royal Tunbridge Wells people are in rented accommodation and as that figure is set to grow over the next decade, now might just be a good time to buy property in Royal Tunbridge Wells – because what else are you going to invest in?  Give your money to the stock market run by sharp suited city whizz kids – because at least with property – it’s something you can touch - there is nothing like bricks and mortar!

Sunday 19 March 2017

321 Royal Tunbridge Wells Households Occupied by OAP Renters


Recent statistics published by the Office of National Statistics show that there are 267,704 private rented households in the Country that are occupied by people aged 65 and older, meaning 4.39% of OAP’s are living in private rented property.

It got me thinking two things. How many of these OAP’s have always rented and how many have sold up and become a tenant?  In retirement, selling up could make financial sense to the mature generation in Royal Tunbridge Wells, potentially allowing them to liquidate the equity of their main home to enhance their retirement income.  I wanted to know why these older people rent and whether there was opportunity for the buy to let landlords of Royal Tunbridge Wells?

The Prudential published a survey recently that said nearly six out of ten OAP renters had never owned a home.  Two out of ten OAP renters were required to sell up because of debt, just about one in ten OAP renters sold their property to use the money to fund their retirement and the remaining one out ten OAP renters, rented for other reasons.

Funding retirement is important as the life expectancy of someone from Royal Tunbridge Wells at age 65 (years) is 20.0 years for males and 22.5 years for females (interesting when compared to the National Average of 18.7 years for males and 21.1 years for females).  The burdens of financing a long retirement are being felt by many mature people of Royal Tunbridge Wells.  The state of play is not helped by rising living costs and ultra-low interest rates reducing returns for savers.

So, what of Royal Tunbridge Wells?  Of the 5,912 households in Royal Tunbridge Wells, whose head of the household is 65 or over, not surprisingly 4,521 of households were owned (76.47%) and 942 (15.93%) were in social housing.  However, the figure that fascinated me was the 321 (5.43%) households that were in privately rented properties.

Anecdotal evidence, by talking to both my team and other Royal Tunbridge Wells property professionals is that this figure is rising.  More and more Royal Tunbridge Wells OAP’s are selling their large Royal Tunbridge Wells homes and renting something more manageable, allowing them to release all of their equity from their old home.  This equity can be gifted to grandchildren (allowing them to get on the property ladder), invested in plans that produce a decent income and while living the life they want to live.

These Royal Tunbridge Wells OAP renters know they have a fixed monthly expenditure and can budget accordingly with the peace of mind that their property maintenance and the upkeep of the buildings are included in the rent.  Many landlords will also include gardening in the rent! Renting is also more adaptable to the trials of being an OAP - the capability to move at short notice can be convenient for those moving into nursing homes, and it doesn't leave family members panicking to sell the property to fund care-home fees.

Royal Tunbridge Wells landlords should seriously consider low maintenance semi-detached bungalows on decent bus routes and close to doctor’s surgeries as a potential investment strategy to broaden their portfolio.  Get it right and you will have a wonderful tenant, who if the property offers everything a mature tenant wants and needs, will pay top dollar in rent!




Tenure: Owned;
Tenure: Shared ownership (part owned and part rented);
Tenure: Rented from council (Local Authority
Tenure: Private rented;
Tenure: Living rent free;
76.47%
0.47%
15.93%
5.43%
1.69%