Local property market information for the serious investor

Month: July 2018

The Edgware Bank of Mum and Dad Lent £4.09m Last Year

My analysis has shown that up to the end of the last quarter, Edgware first time buyers purchased 144 Edgware properties.  With wages rising at 2.8%, unemployment at a low rate of 4.2% (down from 4.6% from a year earlier and the joint lowest since 1975), national GDP rising at 1.87% and inflation at 2.3%, tied in with indifferent house price growth (compared to a few years ago), this has given first time buyers a chance to get a foot hold on the Edgware property market.

Over the last year, the average purchase price of an Edgware first time buyer property has been £400,800 and the average deposit was £64,930. Furthermore, my calculations show the average Edgware parents contributed £28,407 of that £64,930 figure.

You see “The Bank of Mum and Dad (Edgware Branch)” is for countless Edgware twenty something’s, perceived to be the only way they will ever be able to afford their first home. In fact, Edgware parents put up a substantial £4.09m in the last 12 months to help their nearest and dearest progeny onto the property ladder. This assistance towards the deposit makes a huge difference, enabling Edgware youngsters who thought they couldn’t get on the housing ladder more able to do so.

With mortgage rates at all-time lows, few Edgware twenty something’s would struggle to make mortgage repayments, but it is the requirement of the deposit which is the issue, although as parents (and grandparents) are helping out where they can, it does little to address the real problems of the housing market, whether for people renting or buying their first home.

If you think about it, as a Country we have been fortunate that the older generation who control the biggest share of the nation’s wealth are so plentiful to those following after. We need to remember, though, that this generosity is
 a sign of the issues of the British housing shortage, not its solution.

But before I leave this article … note I used the word PERCEIVED in a previous paragraph. Yes, the average first time buyer deposit is 16.1%, but that is an average. Did you know 95% mortgages returned to first time buyers in late 2009 and have been available ever since? Also, lenders like Barclays and many local Building Society’s now offer 100% mortgages (i.e. no deposit) at 2.75% fixed for three years.

The perception is you need 15%, 20% even a 25% deposit to be a first-time buyer – you don’t! You don’t need any deposit, but (there is always a but!)…

Over the last decade, many renters have upgraded themselves into homes that they (or any generation before them) could never have ever afforded as a first time buyer in the past. You see the British housing market started to change with the dawn of the new Millennium and I am seeing a slow but steady attitude change when it comes to renting. Those tenants have found the price difference of upgrading from the typical 1970’s TV show Rigsby “Rising Damp” style rental property to plush terraced house or even semi-detached home, with all the mod cons, comparatively inexpensive (when compared to the increase in mortgage payments if they had to make the move as buyers).

Renting isn’t seen as the poor man’s choice, as many young (and increasing older) people are becoming more at ease and comfortable with the flexibility offered by private renting a property rather than jumping ‘lemming like’ into home ownership. Edgware landlords will continue to see growth in sector, and like Germany, todays renters will become homeowners in 20 years’ time – when they will inherit the wealth of their parent’s home.

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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BENJAMIN STEVENS – PROUD SPONSORS OF THE BUSHEY FESTIVAL…. PROUD OF BUSHEY!

For the first time this year Benjamin Stevens were among the proud sponsors of the hugely popular Bushey Festival. The event ran from Sunday 30th June until Saturday 8th July 2018 at various well known locations around the Bushey area.

The week long programme featured tried and tested favourites alongside new events including live music, quizzes and events for everyone of all ages to enjoy. The festival’s main aim was to bring the community together.

The Benjamin Stevens team were lucky enough to be present at the event on Sunday 8th July at King George Recreation Ground. Our football themed stand featured a target shot goal and we were giving away our famous teddy bears and balloons in return for a small 50p donation to charity. We managed to raise just shy of £115 which we’ve calculated means that there are 228 Benjamin Stevens’s teddy bears floating around the community!

We wanted to post an extract from the much appreciated thank you note we received from The Bushey Festival team.

At Benjamin Stevens we aim to do everything we can to showcase what’s great about the local areas we work in. In doing this we hope not only attract new people to the area, but encourage existing buyers and renters to stay! Our end goal (excuse the pun) is to publicise the best that Bushey and Edgware has to offer.

Here is the extract:

“Just wanted to say a big thank you from all the festival committee to all your team that were at the park on Sunday. All your hard work and dedication was really appreciated and you were absolute star sponsors in all our eyes. Whilst the investment you gave was crucial to helping us run the festival this year in a turbulent commercial climate, we also recognise the physical time you and your office gave to ensure that the festival was a success.

Your football themed stall was an excellent idea and probably helped the other stall holders immensely, by drawing a decent crowd to the stall area. We saw lots of people with the bears all over the park throughout the day so you obviously did a top job!

It was great to have you there and all your team really got stuck in and were one of the first to pitch up and last to leave, even helping other traders with setting up their stalls too.

Time, as we all know is very precious and the fact that you and your team went over and above to support the build up to the festival through social media and on the day in the park itself, in a novel and unique way, is superb. We also appreciate you  giving your resources during what I know is a very busy period in your office, and your hard working team ultimately giving up their weekends to join us on a Sunday, away from your families and friends,  meant the world to our cause and significantly your input into the Bushey community itself.

These are simple words, but we thank you and your team enormously for making our 33th anniversary festival so special this year, in such an engaging and supportive way.
We hope you enjoyed it as much as we did and that you reap the well-deserved benefits of being a festival partner. “

 

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Additional 2,102 Edgware Rented Homes Required by 2027

I have been doing some research, looking both at National and Regional reports on the demand and supply of property and people together with future projections on the economy, population and family demographics with some interesting results.  According to the Office of National Statistics, in the last financial year nationally, private renting grew by 74,000 households, whilst the owner occupied dwelling stock increased by 101,000 and social (aka council and housing association) stock increased by 12,000 dwellings.

It was the private rental figures that caught my eye.  With eight or nine years of recovery since the Credit Crunch, economic recovery and continuing low interest rates have done little to setback the mounting need for rented housing.  In fact, with house price inflation pushing upwards much quicker than wage growth, this has meant to make owning one’s home even more out of reach for many Millennials, all at a time when the number of council/social housing has shrunk by just over 2.5% since 2003, making more households move into private renting.

There are 16,106 people living in 4,905 privately rented

properties in Edgware.

In the next nine years, looking at the future population growth statistics for the Edgware area and making careful and moderate calculations of what proportion of those extra people due to live in Edgware will rent as opposed to buy, in the next ten years, 6,903 people (adults and children combined) will require a private rented property to live in.

Therefore, the number of Private Rented homes in Edgware will need to rise by 2,102 households over the next nine years,

That’s 234 additional Edgware properties per year that will need to be bought by Edgware landlords, for the next nine years to meet that demand.

… and remember, I am being conservative (with a small ‘c’) with those calculations, as demand for privately rented homes in Edgware could still rise more abruptly than I have predicted as I would ask if Theresa May’s policies of building 400,000 affordable homes (which would syphon in this 5-year Parliamentary term is rather optimistic, if not fanciful?

So, one has to ask wonder if it was wise to introduce a buy to let stamp duty surcharge of 3% and the constraint on mortgage tax relief could curtail and hold back the ability of private landlords to expand their portfolios?

Well a lot of landlords are taking on these new hurdles to buy to let and working smarter.  Buying the property at the right price and using an agent to negotiate on your behalf (we do this all the time) … and the 3% stamp duty level isn’t an issue.  Incorporating your property portfolio into a Limited Company is also a way to circumnavigate the issues of mortgage tax relief (although there are other hurdles that need to be navigated on that tack), but just look at the growth of proportion of Buy to Let properties in the Country since the Summer of 2016 … something tells me smart Landlords are seeing these challenges as just that … challenges which can be overcome by working smarter.

 

 

I have a steady stream of Edgware landlords every week asking me my opinion on the future of the Edgware property market and their individual future strategy and, whether you are a landlord of mine or not, if you ever want to send me an email or pop into my office to chat on how you could navigate these new Buy to Let waters … it will be good to speak to you (because you wouldn’t want other landlords to have an advantage over you – would you?).

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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