Local property market information for the serious investor

Month: June 2018

45% Drop in Properties For Sale Today in Edgware Compared to 10 Years Ago

There is good news for Edgware buy to let landlords as ‘top of the range’ well-presented properties are getting really decent rents compared to a year ago however, this rise in rents is thwarting many potential first time buyers from saving for both a deposit and money for a rainy day. On top of this, there is also a shortage of Edgware homes coming on the market thus adding fuel to the slowdown and affecting not just Edgware first time buyers but also those going up the housing ladder.

Whilst it is true that the Government’s initiatives, targeted at improving the supply of homes built and helping first time buyers obtaining necessary funding, are starting to work (albeit slowly), I also believe that to boost more existing home-owners and their properties onto the market, we as a Country, need to see a better focus placed on those looking to downsize (i.e. the mature generation).

If we took away some hurdles to home owners downsizing, such as removing stamp duty for those downsizers (as was done for first time buyers last year), together with encouraging even more first-time buyers with 100% mortgages to buy the smaller properties, this would in turn release more mid-range properties onto the market, which subsequently would encourage more mature homeowners to downsize from their bigger properties to buy those mid-range properties – thus completing the circle.

Looking at the most recent set of data from the Land Registry for Edgware (the HA8 postcode in particular), the figures show the indifferent nature of the current Edgware property market.

Only 234 Edgware (HA8) Homes changed hands in the last 6 months

Edgware property values and transactions continue to be sluggish, and the monthly peaks and troughs of house prices and properties changing hands doesn’t mask the deficiency of suitable realistically priced property coming onto the Edgware property market, meaning the housing market is slowly becoming inaccessible to some would-be home owners.

Looking at what each property type is selling for in HA8 (note the data from the Land Registry is always 4/5 months behind) makes interesting reading ….

 

Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Percentage Change Between Aug 17 and Jan 18
Semi Detached £548,067 £683,871 £683,179 £566,417 £525,359 £540,228 -1.43%
Terraced £510,727 £437,200 £406,725 £436,500 £422,250 £385,333 -24.55%
Apartment £398,500 £344,167 £347,841 £368,867 £342,500 £340,571 -14.54%
 Average £532,261 £511,068 £511,333 £473,243 £511,069 £459,987 -13.58%

 

One must remember these are the average prices paid, so it only takes a run of a few expensive or cheaper property types (as can be seen with the variance in the Terraced and Semi Detached in the table) to affect the figures..

Looking at the numbers of properties for sale … I looked at my research for early Summer 2008, and at that time, 803 properties were on the market for sale in Edgware.. and when I did my research on this article today, just 438 properties for sale.. a drop of 45%.

The Government needs to seriously consider the supply and demand of the UK property market as a whole to ensure it doesn’t seize up. It needs to do that with bold and forward-thinking plans but, in the meantime, people still need a roof over their head, so as local authorities don’t have the cash to build new houses anymore, it’s the job of Edgware landlords to take up the slack. I must stress though, I have noticed a distinct ‘flight to quality’ by Edgware tenants, who are prepared to pay top dollar for an exceptional home to rent.  If you want to know what tenants are looking for and what type of things you as an Edgware landlord need to do to maximise your rental returns – drop me a line.

If you are a landlord or thinking of becoming one for the first time, and you want to read more articles like this about the Edgware Property Market together with regular postings on what I consider the best buy to let deals in Edgware, out of the many of properties on the market, irrespective of which agent is selling it, then feel free to get in touch! Email me at Steve@benjaminstevens.co.uk

If you are in the area feel free to pop into the office we are based at 194 Station Road Edgware Middlesex HA8 7AT– the kettle is always on.

Don’t forget to visit the links below to view back dated deals and Edgware Property News.

Blog – http://www.benjaminstevens.co.uk/edgware-property-blog

Facebook – https://www.facebook.com/BenjaminStevensEstateAgents

Twitter – https://twitter.com/BenjamStevensEA

Website – http://www.benjaminstevens.co.uk

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More Than Three Babies Born for Every New Home Built in the Past Five Years in Barnet

More than 3 babies have been born for every new home that has been built in Barnet since 2012, deepening the Edgware housing shortage.

 

This discovery is an important foundation for my concerns about the future of the Edgware property market – when you consider the battle that todays twenty and thirty somethings face in order to buy their first home and get on the Edgware property ladder. This is particularly ironic as these Edgware youngsters’ are being born in an age when the number of new babies born to new homes was far lower.

 

This will mean the babies being born now, who will become the next generation’s first-time buyers will come up against even bigger competition from a greater number of their peers unless we move to long term fixes to the housing market, instead of the short term fixes that successive Governments have done since the 1980’s.

 

Looking at the most up to date data for the area covered by Barnet Council, the numbers of properties-built versus the number of babies born together with the corresponding ratio of the two metrics …

 

 

 

 

 

It can be seen that in 2016, 2.68 babies had been born in Barnet for every home that had been built in the five years to the end of 2016 (the most up to date data). Interestingly, that ratio nationally was 2.9 babies to every home built in the ‘50s and 2.4 in the ‘70s. I have seen the unaudited 2017 statistics and the picture isn’t any better! (I will share those when they are released later in the year).

 

Our children, and their children, will be placed in an unprecedented and unbelievably difficult position when wanting to buy their first home unless decisive action is taken. You see it doesn’t help that with life expectancy growing year on year, this too is also placing excessive pressure on homes to live in availability, with normal population growth nationally (the number of babies born less the number of people passing away) accumulative by two people for every one home that was built since the start of this decade.

 

Owning one’s home is a measure many Brits to aspire to. The only long-term measure that will help is the building of more new homes on a scale not seen since the 50’s and 60’s, which means we would need to aim to at least double the number of homes we build annually.

 

In the meantime, what does this mean for Edgware landlords and homeowners? Well the demand for rental properties in Edgware in the short term will remain high and until the rate of building grows substantially, this means rents will remain strong and correspondingly, property values will remain robust.

If you are a landlord or thinking of becoming one for the first time, and you want to read more articles like this about the Edgware Property Market together with regular postings on what I consider the best buy to let deals in Edgware, out of the many of properties on the market, irrespective of which agent is selling it, then feel free to get in touch! Email me at Steve@benjaminstevens.co.uk

If you are in the area feel free to pop into the office we are based at 194 Station Road Edgware Middlesex HA8 7AT– the kettle is always on.

Don’t forget to visit the links below to view back dated deals and Edgware Property News.

Blog – http://www.benjaminstevens.co.uk/edgware-property-blog

Facebook – https://www.facebook.com/BenjaminStevensEstateAgents

Twitter – https://twitter.com/BenjamStevensEA

Website – http://www.benjaminstevens.co.uk

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786 Edgware Landlords Plan to Expand Their Buy To Let Portfolios

A noteworthy number of buy to let landlords in Britain plan to buy more properties over the next year notwithstanding the frustrations, challenges and seismic changes in the private rented sector. According to Aldermore, the specialist Buy To Let lender, their research shows around 41% of portfolio buy to let landlord’s objective is to grow their buy to let portfolio (Portfolio landlords are landlords that own more than one property).

So, I thought, “Are Edgware landlords feeling the same?” If so, if these numbers were applied to the Edgware private rental market, what sort effect would it have on the Edgware property market as whole?

Talking to the landlords I deal with, most are feeling quite optimistic about the future of the Edgware rental market and the prospect it presents notwithstanding the doom and gloom prophecies that the property market will shrink. Many of those Edgware landlords who are looking to enlarge their portfolio are doing so because they still see the Edgware rental market as a decent investment opportunity.

With top of the range Bank and Building Society Savings Accounts only reaching 1.5% a year, the rollercoaster ride of Crypto currency and the yo-yoing of the Stock Market, the simple fact is, with rental yields in Edgware far outstripping current savings rates, the short term prospect of a minor drop in property prices isn’t putting off Edgware landlords.

The art to buying an Edgware buy to let investment is to buy the profit on the purchase price, not the anticipation of the future sale price.

No matter what the historical economy has thrown at us, with the global meltdown in 2008/9, dotcom crash of 2000, ERM in 1992, the three day week, oil crisis and hyperinflation in the 1970’s (the list goes on) … the housing market has always bounced back stronger in the long term. That’s the point … long term. Investing in buy to let is a long-term strategy. The simple fact is, over the long term with the increasing demand for rental properties, predominantly among Millennials as many cannot afford to get on the property ladder, and with councils not building enough properties of any kind, many youngsters are having to resort the private rental market for their accommodation needs.

So, what of the numbers involved in Edgware?

There are 881 landlords that own just one buy to let (BTL) property in Edgware (or HA8 to be precise) and 1,918 Edgware landlords, who are portfolio landlords. Between those 1,918 Edgware portfolio BTL landlords, they own a total of 4,025 Edgware BTL properties and they can be split down into the size of landlord portfolio in the graph below….

If I apply the Aldermore figures that means 786 Edgware landlords have plans to expand their BTL portfolio in the coming year or so.

 

However, the Aldermore Research also showed that 8% of private landlords intended to reduce the number of properties they own. They put this down to continuing Government intervention in the housing market (as many landlords mentioned too many limitations and higher taxation) while some believed that tenants are excessively protected to the disadvantage of the landlord.

I would say there is no repudiating that the buy to let market has taken a bit of a beating, thanks to a plethora of Government regulation, new mortgage underwriting rules in 2014 and George Osborne’s tax changes. Yet there still remains an overall consciousness of optimism among the vast majority of Edgware buy to let landlords. Despite these latest changes, many landlords still view buy to let as a good investment, as long as you buy right and expand your portfolio taking into account the second rule of buy to let … assess your position on the ‘buy to let seesaw’ of capital growth and yield.

If you want to buy right and assess your own portfolio on the yield/capital growth seesaw … drop me a note. I don’t bite and the opinion I give, whether you are landlord of mine or not as the case may be, is given freely, without obligation or cost. The choice is yours. Thank you for reading this article. To read others, please visit my Edgware Property Blog.

If you are a landlord or thinking of becoming one for the first time, and you want to read more articles like this about the Edgware Property Market together with regular postings on what I consider the best buy to let deals in Edgware, out of the many of properties on the market, irrespective of which agent is selling it, then feel free to get in touch! Email me at Steve@benjaminstevens.co.uk

If you are in the area feel free to pop into the office we are based at 194 Station Road Edgware Middlesex HA8 7AT– the kettle is always on.

Don’t forget to visit the links below to view back dated deals and Edgware Property News.

Blog – http://www.benjaminstevens.co.uk/edgware-property-blog

Facebook – https://www.facebook.com/BenjaminStevensEstateAgents

Twitter – https://twitter.com/BenjamStevensEA

Website – http://www.benjaminstevens.co.uk

Continue Reading