Tuesday, 23 July 2019

Which Royal Tunbridge Wells Properties are Selling the Best?

Moving home is said to be the third most stressful life event, following a member of your family dying or getting divorced. So it is always best to keep your stress levels down by investigating and doing your homework on both the particular area of Royal Tunbridge Wells (or nearby conurbations) where you live (i.e. where you are selling) and where you want to search for your next Royal Tunbridge Wells home. Being mindful of how fast (or slow) the different aspects of the Royal Tunbridge Wells property market is moving is key.. because it could save you much heartache and many thousands of pounds. 

You see, if you know you are selling a property in a sluggish price range and buying in a faster moving price range in Royal Tunbridge Wells then putting your property on the market first is vital, otherwise you will always find the one you want to buy tends to sell before your property sells - there is nothing worse than pondering over a property only to find that someone else has bought it. Being primed with all the knowledge is key. On the other side of the coin, if you are selling in a fast moving market and buying in a sluggish market .. you can probably get a better deal on the one you are buying.

For buy to let landlords in Royal Tunbridge Wells, this evidence is particularly critical as purchasing a high-demand property in a well-liked area of Royal Tunbridge Wells will safeguard a surfeit of availability of tenants, as well as respectable house price growth. 
Being an agent in Royal Tunbridge Wells, I like to keep an eye on the Royal Tunbridge Wells property market on a daily basis because it enables me to give the best advice and opinion on what (or not) to buy in Royal Tunbridge Wells; be that a buy to let property for a landlord or an owner occupier house.  So, I thought, how could I scientifically split the Royal Tunbridge Wells housing market into sections, so I could analyse which part of the Royal Tunbridge Wells property market was doing the best (or the worst)
I took the decision that the preeminent way was to fragment the Royal Tunbridge Wells property market into roughly four uniform size price bands (in terms of properties for sale). Each price band would have roughly around 25% of the property in Royal Tunbridge Wells available for sale .. then add up all the sold (stc) properties and see which sector of the Royal Tunbridge Wells property market was performing best? … And these were the results .. 

# Properties For Sale 
# Properties Sold (stc)
up to £270,000
£270,000 to £350,000
£350,000 to £550,000
£550,000 upwards

The best performing price range in Royal Tunbridge Wells is the middle to upper market £350,000 to £550,000 where 36.2% of all property in that price range has a buyer and is sold stc.
It’s not unexpected that the upper end of the property market (the top 25%) in Royal Tunbridge Wells is finding things a little tougher compared to the others. Remarkably for Royal Tunbridge Wells landlords, the lower market is doing reasonably well, but it’s not the best, so maybe there could be some property deals out there for buy to let investment? Even though the number of first time buyers in 2018 did increase over the 2017 levels, it was from a low starting point and the large majority of 20 to 30yo’s don’t want to or can’t buy their first home and the local authority has no money to build Council houses meaning an increase in demand as private landlords take up the slack – because everyone needs a roof over their head!
If you would like to pick my brains on the Royal Tunbridge Wells Property Market – pop in for a coffee or drop me a line on social media or email. 

Wednesday, 17 July 2019

10% more homes for sale in Royal Tunbridge Wells than a year ago

One of the key factors of the health of the Royal Tunbridge Wells property market is the number of properties for sale at any one time. The issue with housing is that when demand goes up, unlike with a chocolate bar factory, who can add a couple of hours overtime to increase supply/production to satisfy demand, it takes a good 18 months to two years from planning permission to someone moving into a home. I have talked at length (and proved) in previous articles that we are still not building enough homes in the long term in the Royal Tunbridge Wells area.. yet for the short term, a good indicator is the number of properties for sale and how long they have been on the market.

How long a property has been on the market is important as a guide to how the property market is performing – potential buyers can always find this information on the Rightmove and Zoopla listings (if you don’t know where – drop me an email or message and I can let you know). 

So, let’s have a look at what is happening in Royal Tunbridge Wells, both in terms of the number of properties for sale and how long they have been on the market compared to a year ago, then discuss what that means for the current state of play of the Royal Tunbridge Wells property market. So to start, let’s look at the number of properties for sale in Royal Tunbridge Wells compared to a year ago.

Interestingly, you can see there has been a proportional increase of 41% in terraced properties on the market in Royal Tunbridge Wells, yet a 12% reduction in detached property .. overall in the last year there are 10% more properties on the market in Royal Tunbridge Wells, compared to a year ago. Now, let’s look how long they have been on the market ..

Interesting to see that the biggest jump in the number of days on the market is terraced houses, from 121 days to 169 days .. demand and supply working again. Also, the length of time an average Royal Tunbridge Wells’ property has been on the market has increased by 23% in the last year.

So what does this all mean for Royal Tunbridge Wells Buy To let landlords and Royal Tunbridge Wells homeowners looking to buy and sell?  Well, if you are thinking of selling, as the number of properties on the market has increased and the length of time Royal Tunbridge Wells properties are on the market has also increased – you have to be mindful that realistic pricing is the key to get the property sold. If you are a buyer, that means you find yourself in a better position to negotiate a good deal on your Royal Tunbridge Wells property purchase. 

There is an argument to suggest that property buyers see excessive days on the market as an indication that the seller is becoming desperate to sell because the property hasn’t sold. Buyers are also mindful to believe that there might be something wrong with the home, a defect that caused other buyers to pass it up. This can concern them when they view the property – if they view it at all, as that possible and perhaps made-up defect is on their minds, even if it is sub-consciously.

Normally, both assumptions are wrong. A property can loiter on the market for several reasons. The most common reason for a property sticking on the market is overvaluing or overpricing. In an effort to get the property on the market, some estate agents may have deluded the seller into believing the property was worth more than the property market will bear. Don’t get me wrong, if you don’t ask, you don’t get and homeowners naturally want to get the best price for their home, and so test the market. Yet, if you aren’t getting a steady stream of viewers after a few weeks, then that testing can back fire. You see, by setting the asking price too high to see if they can find someone to pay that inflated price, then finding there is nobody in the market that will pay the price, here lies the biggest trap for house sellers on keeping the inflated asking prices for too long. 

Sellers can also get stuck on an asking price and they are willing to wait out the market until it catches up to what they want for their property – yet we aren’t in that type of property market at the moment. Consumer champion Which said that if you have to reduce your asking price by 5% or more, it adds an extra 64 days to the sales process meaning you might lose the property of your dreams.

Also, I have seen countless times, house sellers insist on an inflated asking price, reduce 12 weeks later, yet buyers think there is something wrong with it so the homeowner gets fed up and accepts a lower offer to get the property sold, whereas if the house seller had gone onto the market at the right asking price, they would get much nearer to what they deserve for their property.

So, if you are looking for a bargain to buy – all the Portals (Rightmove, Zoopla and On The Market) allow you to search and sort by the length of time on the market as well as the asking price.. who knows – there could be a bargain waiting for you!

Tuesday, 2 July 2019

What Has Happened to the Property Market in Royal Tunbridge Wells Since the Last Property Market Crash?

A handful of landlords and homeowners from Royal Tunbridge Wells have been asking me what would happen if we had another property crash like we did in 2008/9? 
The UK property crash in 2008/9 caused property prices in the UK to drop by an average of 18.37% in a period of 16 months.
On the run up to the Parliamentary vote on Brexit scheduled for March, a number of people asked what a no-deal Brexit would do to the property market and if there would be a crash as a result. I have discussed in a previous article on the chances of that (slim but always a possibility) … but assuming it happens, it is my opinion the outcome of a no-deal Brexit would be no worse than the country’s 2008/9 credit crunch property crash, the late 1988 property crash, the 1974 property crash, 1951 property crash … I could go on. The British economy would bounce back from the shock of a no-deal Brexit with lower property values and a continued low interest rate environment (together with an additional round of Quantitative Easing) and that would mean we would see a similar bounce back as savvy buyers saw it as a fantastic buying opportunity. 
So, let me explain the reasons I believe this...
Many said after the Brexit vote in June 2016, we were due a property crash - but we all know what happened afterwards.
Initially, let’s see what would happen if we did have a crash, how quickly it would bounce back and then finally discuss how the chances of a crash are actually quite minimal.
Therefore, to start, I have initially split down the types of property in Royal Tunbridge Wells (Det/Semi etc.) and in the red column put the average value of that Royal Tunbridge Wells property type in 2009. Next in the orange column what those average values are today in 2019.
Royal Tunbridge Wells Property Market 
The likely effects of a Property Crash and Recovery

Average Value in 2009
Average Value in 2019
Assumed Average Value by Q2 2020  (if Property Crash)
Assumed Value in 2024/5
Semi Detached

Now, assuming we had a property crash like we did in 2008, when average property values dropped nationally by 18.37%, I applied a similar drop to the current 2019 Royal Tunbridge Wells figures (i.e.the green column) to see what would happen to property values by the middle 2020 (because the last crash only took 13/14 months).
…and finally, what would subsequently happen to those same property prices if we had a repeat of the 2009 to 2014 property market bounce back. 

Of course, these are all assumptions and we can’t factor in such things as China going pop on all its debt ... yet either way, the chance of such a crash coming from internal UK factors are much slimmer than in another of the four property crashes we have experienced in the last 80 years. Why, you might ask? 
The seven reasons I believe are these … 
1.    The new Bank of England mortgage rules on lending 2014 to stop reckless lending that fuelled that last crash.
2.    Low inflation.
3.    Low mortgage rates (the average Brit’s fixed rate mortgage is currently 2.26% and the variable rate mortgage of 3.07%).
4.    Wage rises are forecast to continue to outgrow inflation.
5.    Unemployment figures dropping to 4% (down from 8.4% in 2011).
6.    The high percentage (67.7%) of all British mortgages being on a fixed rate.
7.    And notwithstanding the distractions of Brexit over the last few years, it cannot be denied that the British economy has slowly and steadily been heading in the right direction for a number of years, built on some decent foundations of a steady housing market (unlike the 1988 and 2008 crashes when the housing market got overheated very quickly on the run up to the crashes).

So as the circumstances are much different to the last two crashes, the chances of a crash are much slimmer. Yet if we do have a crash, for the very same 7 reasons above why the chances of a crash are unlikely, those 7 reasons would definitely contribute to making the ensuing recession neither too long nor substantial in scale.

One final thought for the homeowners of Royal Tunbridge Wells. Most people when they move home, move up market, meaning in a decreasing market you will actually be the winner, as a 10% drop on yours would be much smaller in £notes than a 10% drop on a bigger property ... think about it.
One final thought for the new and existing buy to let landlords of Royal Tunbridge Wells. Well, the questions I seem to be asked on an almost daily basis by landlords are: -
·      “Should I sell my property in Royal Tunbridge Wells?”
·      “Is the time right to purchase another buy to let property in Royal Tunbridge Wells and if not Royal Tunbridge Wells, where?”
·     “Are there any property bargains out there in Royal Tunbridge Wells to be had?” 

Many other Royal Tunbridge Wells landlords, who are with us and many who are with other Royal Tunbridge Wells letting agents, all like to pop in for a coffee, pick up the phone or email usto discuss the Royal Tunbridge Wells property market, how Royal Tunbridge Wells compares with its closest rivals (Tonbridge, Crowborough and Heathfield), and hopefully answer the three questions above. I don’t bite, I don’t do hard sell, I will just give you my honest and straight-talking opinion. I look forward to hearing from you.