Tuesday, 26 March 2019

Royal Tunbridge Wells Homeowners 227% More Likely To Live in a Home with 3+ Bedrooms than those that Privately Rent

The conventional way of categorising property in Britain is to look at the number of bedrooms rather than its size in square metres (square feet for those of you over 50!). My intuition tells me that homeowners and tenants are happy to pay for more space. It’s quite obvious, the more bedrooms a house or apartment has, the bigger the property is likely to be. And it’s not only the tangible additional bedrooms, but those properties with those additional bedrooms tend to have larger (and more) reception (living) rooms. However, if you think about it, this isn’t so surprising given that properties with more bedrooms would typically accommodate more people and therefore require larger reception rooms.

In todays Royal Tunbridge Wells property market, the Royal Tunbridge Wells homeowners and Royal Tunbridge Wells landlords I talk to are always asking me which attributes and features are likely to make their property comparatively more attractive and which ones may detract from the price. Over time buyers’ and tenants’ wants and needs have changed. 

In Royal Tunbridge Wells, location is still the No. 1 factor affecting the value of property, and a property in the best neighbourhoods can achieve a price almost 50% higher than a similar house in an ‘average’ area. Nevertheless, after location, the next characteristic that has a significant influence on the desirability, and thus price, of property is the number of bedrooms and the type (i.e. Detached/Semi/Terraced/Flat).

The number of bedrooms for owner-occupiers very much depends on the size of the family and the budget, whilst Royal Tunbridge Wells landlords have to consider the investment opportunity. In this article, I have analysed Royal Tunbridge Wells’ housing stock into bedrooms and tenure. Initially looking at Royal Tunbridge Wells homeowners..

And now the Private rented sector … 

It can quite clearly be seen that Royal Tunbridge Wells owner-occupiers tend to occupy the larger properties with more bedrooms. This would be expected due to the demographic of homeowners and people that privately rent.

However, this shows there could be opportunities for Royal Tunbridge Wells buy to let landlords to purchase larger properties with more bedrooms to attract tenants requiring properties with more bedrooms. However, before you all go buying larger 4 bed and 5 bed mansions to rent them out, a lot of bigger properties in Royal Tunbridge Wells don’t make financial sense when it comes to buy to let.

For numerous years Royal Tunbridge Wells buy to let landlords have been the lone buyers at the smaller one and two bed starter homes of the market, as they have been lured by elevated tenant demand and eye-catching returns. Some Royal Tunbridge Wells landlords believe their window of opportunity has started to close with the new tax regime for landlords, whilst it already appears to be opening wider for first time buyers. This is great news for first time buyers .. but one final note for Royal Tunbridge Wells landlords .. all is not lost .. you can still pick up bargains, you just need to be a lot more savvy and do your homework ..one source of such information with articles like this is the Royal Tunbridge Wells Property Market Blog 

Tuesday, 19 March 2019

As OAP’s set to rise to 1 in 4 of Royal Tunbridge Wells’ population by 2037 – Where are they all going to live

With constant advances in technology, medicine and lifestyles, people in the Royal Tunbridge Wells area are, on average, living longer than they might have a few decades ago. As Royal Tunbridge Wells' population ages, the problem of how the older generation are accommodated is starting to emerge. We, as a town, have to consider how we supply decent and appropriate accommodation for Royal Tunbridge Wells’ growing older generation’s accommodation needs while still offering a lifestyle that is both modern and desirable. 

In 1997 in Royal Tunbridge Wells, around one in every six people (17%) were aged 65 years and over (and the local authority area as a whole), increasing to nearly one in every five people (19%) in 2017 and it is projected to reach around one in every four people (26%) by 2037, meaning..

Over the next 19 years, the growth of the over 65 population in Royal Tunbridge Wells will grow by 36.8% - a lot more than the overall growth population of Royal Tunbridge Wells of 6.1% over the same time frame.

In fact, the number of those over 90 is expected to more than double in our local authority from 1,371 (1.2%) in 2017 to 3,100 (2.5%) by 2037.

And looking at the proportional percentage changes over those years..

Looking at Royal Tunbridge Wells and the local authority as a whole, there is a distinct under supply of bungalows and retirement living (i.e. sheltered) accommodation. The majority of sheltered accommodation fit for retirement is in the ex-local authority sector whilst the majority of private sector bungalows were built in the 1960s/70s/80s and are beginning to show their age (although that means there is often an opportunity for Royal Tunbridge Wells investors and Royal Tunbridge Wells buy to let landlords to buy a tired bungalow, do it up and flip it/rent it out).

In the medium to longer term, we need to build more bungalows and sheltered accommodation and, if we do that, that won’t only be of benefit to the elderly population of Royal Tunbridge Wells – it will have a direct knock-on effect to the younger and middle-aged population by unlocking those family homes the older generation homeowners live in.  

There have been 17 Housing Ministers since 1997. No one ever seems to stay in the job long enough to create a consensus and direction in Government Policy on the vital issue of the country’s housing shortage, yet the sound bites and White Papers seem only to focus exclusively on first-time buyers when there is an even more severe and disregarded shortage in suitable housing for the older generation.

This scantiness affects both mature homeowners trapped in unsuitably big family properties, unable to find smaller bungalows or suitable retirement apartments, whilst the waiting list for Council sheltered accommodation is putting a strain on other aspects of social care. In both circumstances, policy coming (or not coming) out of Government is repressing the supply and type of accommodation mature people desire, need and want, whilst at the same time, increasing the cost (and taxes) for social and NHS care.

Maybe we need tax breaks for people to downsize or planning permissions that stipulate bungalows only. Whichever way you look .. there are challenging times ahead for us all.

Tuesday, 5 March 2019

The ‘Home Owning’ Movers and Shakers in Royal Tunbridge Wells in 2018

It’s now commonly agreed amongst economists and the general public that the dramatic rise in Royal Tunbridge Wells’ property prices of the last six years has come to an end. 
Read the National newspapers, and they talk of doom and gloom in the British housing market with such things as strained buyer affordability (as property prices have increased over the past six years at a far faster pace than average salaries), a lack of new properties being built and the Brexit uncertainties over the last two and half years being blamed for the slow down - yet in the last 12 months, people have still been moving, buying and selling in Royal Tunbridge Wells at levels similar to the last six years - something tells me we have a case of ‘bad news selling newspapers’. \

So instead, let me share with you what, exactly, is happening in the Royal Tunbridge Wells property market, and more specifically, who is moving and why. Most of the sales in Royal Tunbridge Wells over the past twelve months were flats, which on average sold for £285,800. Terraced properties had an average sold price of £391,550 and semi-detached properties averaged at £465,250.

In Royal Tunbridge Wells, in the homeowner sector in 2018 (i.e. owner occupation), 447 households moved within the tenure (i.e. sold the home they owned and bought another one) and 87 new households were created (i.e. they moved from living with family/friends and bought their first home without privately renting).

What does this mean for Royal Tunbridge Wells buy to let landlords? Well looking at the graph, it appears bad news for landlords. There were 208 households that moved into the home owning (owner occupation) tenure from the private rented sector, whilst on the other side of the coin, 164 Royal Tunbridge Wells households moved to the private rented sector from owner occupation … which appears on the face of it, a reduction in the private sector.

My research has calculated that in 2018, an additional 217 new households in the Royal Tunbridge Wells private rental sector were created

...and it will continue to grow at those levels for the foreseeable future.

I have one final thought and opportunity for you property investors in Royal Tunbridge Wells. 108 owner occupied households in Royal Tunbridge Wells sold in last year where the homeowners had passed away. These properties can be a potential goldmine and offer great returns. The reason being is some members of the older generation who have owned these homes for decades have spent money on high capital items (double glazing / central heating etc.) but not spent money on more superficial low-ticket items such as up to date carpets, kitchen, bathroom and decorating (vital if you want to sell your property for top dollar). These properties can often be bought cheaply because most buyers can’t see past the avocado or brown bathroom suite from the 1970’s and the dated decor, so if you were to buy wisely and do the works, you could sell it on for a healthy profit.

So, whatever is happening in the world with Brexit, Trump, China, and the Stock Market … the Royal Tunbridge Wells housing market is in decent shape for the medium to long term. If we do have small corrections in values in the next 12 to 18 months, in the long term, house prices have always returned ... and returned with vengeance. Like I say to anyone buying a property, be they a first time buyer, landlord or homeowner ... property is a long game ... and if you play the long game, you will always win (although isn’t that true in most aspects of life?).