Tamworth House Prices Outstrip Wage Growth by 15.34% since 2007

I recently read a report by the Yorkshire Building Society that 54% of the country has seen wages (salaries) rise faster than property prices in the last 10 years. The report said that in the Midlands and North, salaries had outperformed property prices since 2007, whilst in other parts of the UK, especially in the South, the opposite has happened and property prices have outperformed salaries quite noticeably.

As regular readers of my blog know, I always like to find out what has actually happened locally in Tamworth. To talk of North and South is not specific enough for me. Therefore, to start, I looked at what has happened to salaries locally since 2007. Looking at the Office of National Statistics (ONS) data for Tamworth Borough Council, some interesting figures came out…

Tamworth West Midlands Nationally
2007  £24,357  £22,417  £23,920
2008  £25,059  £23,390  £24,960
2009  £24,216  £23,754  £25,506
2010  £25,246  £24,398  £26,088
2011  £25,761  £24,190  £26,010
2012  £25,002  £24,404  £26,432
2013  £25,121  £25,116  £26,931
2014  £23,769  £25,022  £27,097
2015  £24,903  £25,589  £27,508
2016  £25,527  £26,406  £28,132

Salaries in Tamworth have risen by 4.8% since 2007 (although it’s been a bit of a rollercoaster ride to get there!) – interesting when you compare that with what has happened to salaries regionally (an increase of 17.79%) and nationally, an increase of 17.61%.

Next, I needed to find what had happened to property prices locally over the same time frame of 2007 and today. Net property values in Tamworth are 20.14% higher than they were in late 2007 (not forgetting they did dip in 2008 and 2009). Therefore…

Property values in the Tamworth area have increased at a higher rate than wages to the tune of 15.34% … meaning, Tamworth is bucking the regional trend

All this is important, as the relationship between salaries and property values is the basis on how affordable property is to first (and second, third etc.) time buyers. It is also vitally relevant for Tamworth landlords as they need to be aware of this when making their buy-to-let plans for the future. If more Tamworth people are buying, then demand for Tamworth rental properties will drop (and vice versa).

As I have discussed in a few articles in my blog recently, this issue of ‘property-affordability’ is a great bellwether to the future direction of the Tamworth property market. Now of course, it isn’t as simple as comparing salaries and property prices, as that measurement disregards issues such as low mortgage rates and the diminishing proportion of disposable income that is spent on mortgage repayments.

On the face of it, the change between 2007 and 2017 in terms of the ‘property-affordability’ hasn’t been that great. However, look back another 10 years to 1997, and that tells a completely different story. Nationally, the affordability of property more than halved between 1997 and today. In 1997, house prices were on average 3.5 times workers’ annual wages, whereas in 2016 workers could typically expect to spend around 7.7 times annual wages on purchasing a home.

The issue of a lack of homeownership has its roots in the 1980’s and 1990’s. It’s quite hard as a tenant to pay your rent and save money for a deposit simultaneously, meaning for many Tamworth people, home ownership isn’t a realistic goal. Earlier in the year, the Tories released proposals to combat the country’s ‘broken’ housing market, setting out plans to make renting more affordable, while increasing the security of rental deals and threatening to bring tougher legal action to cases involving bad landlords.

This is all great news for Tamworth tenants and decent law-abiding Tamworth landlords (and indirectly owner occupier homeowners). Whatever has happened to salaries or property prices in Tamworth in the last 10 (or 20) years … the demand for decent high-quality rental property keeps growing. If you want a chat about where the Tamworth property market is going – please read my other blog posts on www.tamworthpropertyblog.co.uk or drop me note via email, like many Tamworth landlords are doing.

If you enjoyed reading my article, feel free to take a look my other online resources below:

Hall and Thompson Estate Agents Tamworth Youtube Channel https://www.youtube.com/channel/UCyF9OUR3g6E8HywCx7tU4DA

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Lorraine’s Tamworth Property Market LinkedIn Page https://www.linkedin.com/in/lorrainethompson2/

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Tamworth Buy-to-Let Return / Yields – 3% to 8.5% a year

The mind-set and tactics you employ to buy your first Tamworth buy to let property needs to be different to the tactics and methodology of buying a home for yourself to live in. The main difference is when purchasing your own property, you may well pay a little more to get the home you (and your family) want, and are less likely to compromise. When buying for your own use, it is only human nature you will want the best, so that quite often it is at the top end of your budget (because as my parents always used to tell me – you get what you pay for in this world!).

Yet with a buy to let property, if your goal is a higher rental return – a higher price doesn’t always equate to higher monthly returns – in fact quite the opposite. Inexpensive Tamworth properties can bring in bigger monthly returns. Most landlords use the phrase ‘yield’ instead of monthly return. To calculate the yield on a buy to let property one basically takes the monthly rent, multiplies it by 12 to get the annual rent and then divides it by the value of the property.

This means, if one increases the value of the property using this calculation, the subsequent yield drops. Or to put it another way, if a Tamworth buy to let landlord has the decision of two properties that create the same amount of monthly rent, the landlord can increase their rental yield by selecting the lower priced property.

To give you an idea of the sort of returns in Tamworth…

The average buy to let yields in Tamworth
The average buy to let yields in Tamworth

 

Now of course these are averages and there will always be properties outside the lower and upper ranges in yields: they are a fair representation of the gross yields you can expect in the Tamworth area.

As we move forward, with the total amount of buy to let mortgages amounting to £199,310,614,000 in the country, landlords need to be aware of the investment performance of their property, especially in the era of tax increases and tax relief reductions. Landlords are looking to maximise their yield – and are doing so by buying cheaper properties.

The average range of buy to let yields in Tamworth
The average range of buy to let yields in Tamworth

 

 

However, before everyone in Tamworth starts selling their upmarket properties and buying cheap ones, yield isn’t the only factor when deciding on what Tamworth buy to let property to buy.  Void periods (i.e. the time when there isn’t a tenant in the property between tenancies) are an important factor and those properties at the cheaper end of the rental spectrum can suffer higher void periods too. Apartments can also have service charges and ground rents that aren’t accounted for in these gross yields. Landlords can also make money if the value of the property goes up and for those Tamworth landlords who are looking for capital growth, an altered investment strategy may be required.

In Tamworth, for example, over the last 20 years, this is how the average price paid for the four different types of Tamworth property have changed…

  • Tamworth Detached Properties have increased in value by 229.3%
  • Tamworth Semi-Detached Properties have increased in value by 252.1%
  • Tamworth Terraced Properties have increased in value by 237.3%
  • Tamworth Apartments have increased in value by 243.2%

It is very much a balancing act of yield, capital growth and void periods when buying in Tamworth. Every landlord’s investment strategy is unique to them. If you would like a fresh pair of eyes to look at your portfolio, be you a private landlord that doesn’t use a letting agent or a landlord that uses one of my competitors – then feel free to contact me and let’s have a chat. What do you have to lose?

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Slowing Tamworth Property Market? Yes and No!

My thoughts to the landlords and homeowners of Tamworth…

The tightrope of being a Tamworth buy-to-let landlord is a balancing act many do well at. Talking to several Tamworth landlords, they are very conscious of their tenants’ capacity and ability to pay the rent and their own need to raise rents on their rental properties (as Government figure shows ‘real pay’ has dropped 1% in the last six months). Evidence does suggest many landlords feel more assured than they were in the spring about pursuing higher rents on their properties.

During the summer months, historic evidence suggests that the rents new tenants have had to pay on move in have increased. June/July/August is a time when renters like to move, demand surges and the normal supply and demand seesaw mean tenants are normally prepared to pay more to secure the property they want to live in, in the place they want to be. This is particularly good news for Tamworth landlords as average Tamworth rents have been on a downward trend recently. So look at the figures here…

Rents in Tamworth on average for new tenants moving in have risen 2.7% for the month, taking overall annual Tamworth rents 2.4% higher for the year

However, several Tamworth landlords have expressed their apprehensions about a slowing of the housing market in Tamworth. I think this negativity may be exaggerated.

Before we get the Champagne out, the other side of the coin to property investing is capital values (which will also be of interest to all the homeowners in Tamworth as well as the Tamworth buy-to-let landlords).  I believe the Tamworth property market has been trying to find some level of equilibrium since the New Year.  According to the Land Registry…

Property Values in Tamworth are 8.2% higher than they were 12 months ago, rising by 2.51% last month alone!

Property values and rents in Tamworth
Property values and rents in Tamworth

Yet, I would take those figures with a pinch of salt as they reflect the sales of Tamworth properties that took place in early Spring 2017 and now are only exchanging and completing during the summer months.

The reality is the number of properties that are on the market in Tamworth today has risen by 20% since the New Year and that will have a dampening effect on property values. As tenants have had less choice, buyers now have more choice … and that will temper Tamworth property prices as we head towards 2018.

Slowing property market?

Be you a homeowner or landlord, if you are planning to sell your Tamworth property in the short term, it is crucial, especially with the rise in the number of properties on the market, that you realistically price your property when you bring it to the market … with the increase in choice of properties, the balance of power during negotiation generally sways towards the buyer. Given that everyone now has access to property details, including historic stats for how much property have sold for, they will be more astute during the offer and negotiation stages of a purchase.

However, even with this uplift in the number of properties for sale in Tamworth, property prices will remain stable and strong in the medium to long term. This is because the number of properties on the market today is still way below the peak of summer of 2008, when there were 1,386 properties for sale compared to the current level of 360 (if you recall, prices dropped by nearly 20% in Credit Crunch years of ‘08 and ‘09).

Compared to 2008, today’s lower supply of Tamworth properties for sale will keep prices relatively high…and they will continue to stay at these levels for the medium to long term.

Less people are moving than a few years ago, meaning less property is for sale. Fewer properties for sale mean property prices remain relatively high and this is because of a number of underlying reasons. Firstly, buy-to-let landlords tend not sell their properties as often than owner-occupiers, consequently removing the property out of the housing market selling cycle. Secondly, Stamp Duty is much higher compared to 10 years ago (meaning it costs more to move). Next, there is a dearth of local authority rental housing so demand for private rented housing will remain high. Then we have the UK’s maturing owner occupier population, meaning these older people are less likely to move (compared to when they were younger). Another reason is the lack of new homes being built in the country (we need 240k houses a year to be built in the UK and we are currently only building 145k a year!) and finally, the new mortgage rules introduced in 2014 about how much a person can borrow on a mortgage has curtailed demand.

Some final thought’s before I go – to all the Tamworth homeowners that aren’t planning to sell – this talk of price changes is only on paper profit or loss. To those that are moving … most people that sell, are buyers as well, so as you might not get as much for yours, the one you will want to buy won’t be as much, (swings and roundabouts as Mum used to say!)

To all the Tamworth landlords – keep your eyes peeled – I have a feeling there may be some decent buy-to-let deals to be had in the coming months. One place for such deals, irrespective of which agent is selling it, is my Tamworth Property Blog … https://www.tamworthpropertyblog.co.uk

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Tamworth’s 2,884 Mortgage Time-Bombs?

According to my research, of the 30,379 properties in Tamworth, 13,351 of those properties have mortgages on them. 91.8% of those mortgaged properties are made up of owner-occupiers and the rest are buy to let landlords (with a mortgage).

… but this is the concerning part .. 2,884 of those Tamworth mortgages are interest only. My research also shows that, each year between 2017 and 2022, 35 of those households with interest only mortgages will mature, and of those, 9 households a year will either have a shortfall or no way of paying the mortgage off. Now that might not sound a lot – but it is still someone’s home that is potentially at risk.

Tamworth mortgages and the proportion of repayment & interest only mortgages.
Tamworth mortgages and the proportion of repayment & interest only mortgages.

 

 

 

 

 

 

 

 

 

 

 

Theoretically this is an enormous problem for anyone in this situation as their home is at risk of repossession if they don’t have some means to repay these mortgages at the end of the term (the typical term being 25 to 35 years). Banks and Building Societies are under no obligation to lengthen the term of the mortgage and, when deciding whether they are prepared to do so or not, will look at it in the same way as someone coming to them for a new mortgage.

Back in the 1970’s and 1980’s, when endowment mortgages were all the rage, having an endowment meant you were taking out an interest only mortgage and then paying into an endowment policy which would pay the mortgage off (plus hopefully leave some profit) at the end of the 25/35-year term. There were advantages to that type of mortgage as the monthly repayments were lower than with a traditional capital repayment and interest mortgage. Only the interest, rather than any capital, is paid to the mortgage company – but the full debt must be cleared at the end of the 25/35-year term.

Historically plenty of Tamworth homeowners bought an endowment policy to run alongside their interest only mortgage. However, because the endowment policy was a stock market linked investment plan and the stock market poorly performed between 1999 and 2003 (when the FTSE dropped 49.72%), the endowments of many of these homeowners didn’t cover the shortfall. Indeed, it left them significantly in debt!

Nonetheless, in the mid 2000’s, when the word endowment had become a dirty word, the banks still sold ‘interest only’ mortgages, but this time with no savings plan, endowment or investment product to pay the mortgage off at the end of the term. It was a case of ‘we’ll sort that nearer the time’ as property prices were on the rampage in an upwards direction!

Thankfully, the proportion of interest only mortgages sold started to decline after the Credit Crunch, as you can see looking at the graph below, from a peak of 43.81% of all mortgages to the current 8.71%.

Percentage of interest only mortgages taken out since 2007 in the UK
Percentage of interest only mortgages taken out since 2007 in the UK

 

 

 

 

 

 

 

 

 

 

Increasing the length of the mortgage to obtain more time to raise the money has gradually become more difficult since the introduction of stricter lending criteria in 2014, with many mature borrowers considered too old for a mortgage extension.

Tamworth people who took out interest only mortgages years ago and don’t have a strategy to pay back the mortgage face a ticking time bomb. It would either be a choice of hastily scraping the money together to pay off their mortgage, selling their property or the possibility of repossession (which to be frank is a disturbing prospect).

I want to stress to all existing and future homeowners who use mortgages to go in to them with your eyes open. You must understand, whilst the banks and building societies could do more to help, you too have personal responsibility in understanding what you are signing yourself up to. It’s not just the monthly repayments, but the whole picture in the short and long term. Many of you reading my blog ask why I say these things. I want to share my thoughts and opinions on the real issues affecting the Tamworth property market, warts and all. If you want fluffy clouds and rose tinted glasses articles – then my articles are not for you. However, if you want someone to tell you the real story about the Tamworth property market, be it good, bad or indifferent, then maybe you should start reading my blog regularly.

For more thoughts on the Tamworth Property Market – visit the Tamworth Property Blog on http://www.Tamworthpropertyblog.co.uk

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Cheeky little number in Amington, Tamworth – Buy-To-Let

A three bedroom semi detached house, Rosemary Road, Amington, Tamworth.  The guide price  is £145,000 with Mark Webster & Company and it’s being sold by the Modern Method of Auction.

Property details are here  ...http://bit.ly/2upw3Bp

The Woodlands Community School is a short walk away and has recently received a good Ofsted report. An added benefit, the school is not oversubscribed.

 

 

Nestled in the highly popular and a very desirable area of Amington, speaks volumes as to the location and therefore the potential for long term letting.

 

 

 

 

The property stands on a good sized plot with a sizable front garden and has a single  detached garage.

 

 

 

 

 

 

 

 

I would certainly get rid of the obtrusive conifers.

Interested? then why not contact Mark Webster & Co. of Tamworth and book yourself a viewing.

*** If you are thinking of getting into the property rental market and don’t know where to start, speak to us for impartial advice and guidance to get the best return on your investment. For more information about other potential investment properties that we could introduce you to, or to ask about our thoughts on your own investment choices, call us now on 01827 425195, you can always email me on Lorraine@hallandthompson.co.uk***

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3,300 Tamworth Landlords – Is This a Legal Tax Loop-Hole?

In November 2015, George Osborne disclosed plans to restrain the buy-to-let (BTL) market, implying its growing attractiveness was leaving aspiring first time buyers contesting with landlords for the restricted number of properties on the market.  One of things he brought in was that tax relief on BTL mortgages would be capped, starting in April 2017.  Before April 2017, a private landlord could claim tax relief from their interest on their BTL mortgage at the rate they paid income tax – (i.e. 20% basic /40% higher rate and 45% additional rate).

So, for example, let’s say we have a Tamworth landlord, a high rate tax payer who has a BTL investment where the rent is £900 a month and the mortgage is £600 per month.  In the tax year just gone (16/17), assuming no other costs or allowable items …

  • Annual rental income £10,800.
  • Taxable rental income would be £3600 after tax relief from mortgage relief
  • Meaning they would pay £1,440 in income tax on the rental income

And assuming no other changes … the landlord would have income tax liability’s (at the time of writing May 2017) in the tax years of …

  • (17/18) £1,800
  • (18/19) £2,160
  • (19/20) £2,520
  • (20/21) £2,880

Landlords who are higher rate tax payers are going to have be a lot smarter with their BTL investments and ensure they are maximising their rental properties full rental capability.  However, there is another option for landlords.

The Tamworth landlords who own the 3,300 Rental properties

Buy To Let Landlords setting up Limited Companies
Buy To Let Landlords setting up Limited Companies

in the town could set up a Limited Company and sell their

property personally to that Limited Company

In fact, looking at the Numbers from Companies House – many landlords are doing this.  In the UK, there are 93,262 Buy To Let Limited Companies, and since the announcement in November 2015 – the numbers have seen a massive rise.

  • Q2 2015 / Q3 2015 – 4,193 Buy to Let Limited Companies Set Up
  • Q4 2015 / Q1 2016 – 5,403 Buy to Let Limited Companies Set Up
  • Q2 2016 / Q3 2016 – 3,007 Buy to Let Limited Companies Set Up
  • Q4 2016 / Q1 2017 – 7,149 Buy to Let Limited Companies Set Up

So, by selling their buy to let investments to their own limited company, owned 100% by them, these landlords could then offset the costs of running their BTL’s as an ‘allowable expense’ – effectively writing off the cost of 100% of their mortgage outgoings, wear and tear and upkeep, letting agent’s fees etc.

I am undeniably seeing more Tamworth landlords approach me for my thoughts on setting up a BTL limited company, so should you make the change to a limited company?

In fact, I have done some extensive research with companies house in the 15 months (1st January 2016 to 31st March 2017 and 394 Buy To Let Limited Companies have been set up in the B postcode alone).

Well if you are looking to hold your BTL investments for a long time it could be very favourable to take the short-term pain of putting your BTL’s in a limited company for a long-term gain.  You see, there are huge tax advantages to swapping property ownership into a limited company but there are some big costs that go with the privilege.

As the law sees the new Limited Company as a separate entity to yourself, you are legally selling your BTL property to your Limited Company, just like you would be selling it on the open market. Your Limited company would have to pay Stamp Duty on the purchase and if you (as an individual) made a profit from the original purchase price, there could be a capital gains tax liability of 18% to 28%.  The mortgage might need to be redeemed and renegotiated (with appropriate exit charges).

On a more positive note, what I have seen though by incorporating (setting up the Limited Company) is landlords can roll up all their little buy to let mortgages into one big loan, often meaning they obtain a lower interest rate and the ability to advance new purchase capital.  Finally, if the tax liability is too high to swap to a limited company, some savvy buy to let investors are leaving their existing portfolios in their personal name whilst purchasing any new investment through a limited company?  Just an idea (not advice!).

It’s vital that landlords get the very best guidance and information from tax consultants with the right qualifications, experience and insurance.  Whatever you do, always get the opinions from these tax consultants in writing and you shouldn’t hurry into making any hasty decisions.  The modifications to BTL tax relief are being progressively eased in over the next three years so there is no need to be unnerved and rush into any decisions before finding out the specifics as they relate precisely to your personal situation, because with decent tax planning (from a tax consultant) and good rental / BTL portfolio management (which I can help you with) … whatever you do – let’s keep you the right side of the line!

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Ask Lorraine – I’m looking to get into buy to let in Tamworth

🙋  Landlord’s Question: 

I’m  looking to get into buy to let to help the shortfall in my pension which the government has stolen from me.  I’m keen to buy in Tamworth,  any quick hints and tips?

Welcome to Tamworth
Welcome to Tamworth

Lorraine’s Answer:

If you are considering becoming a landlord and buying a property to let out there are many things to consider. I think the number one thing is to decide exactly what you are looking to achieve.

Is it purely an income to subsidise your pension, capital growth, or even an investment that can be passed onto your children that you are looking for?

As a rule of thumb, you generally find that property with a high yield does not obtain a high capital growth and property with a high capital growth does not usually net a high yield.

The majority of landlords tend to buy a property that can give a decent growth potential with a yield that covers their costs plus a little extra.

The average yields in Tamworth are 5 % – 6%

So what  should you buy?

Landlords tend to buy locally to them as they have the knowledge of their own area and do not want to travel too far if they manage their own  properties.

I personally like a Victorian house, lots of character unlike the boxes of today, however the purse strings tend to be open a lot more on these properties, so I would say a two bedroom modern house which is in a good location would be a good bet.

Always buy a freehold property so that you don’t have the yearly maintenance charge eating into your yield and I wouldn’t recommend  buying a four bed if you are looking at single lets. Generally the bigger the house the lower the yield, plus larger properties tend to have more wear and tear from having a large family in residence.

Take into consideration any fees to purchase the Buy to Let before you start your property journey, stamp duty is payable… Details here

and have you sought advice as to any advantages of setting up a limited company, it’s usually only an advantage if you are purchasing a number of Buy to Lets, are in the higher tax band or looking to become a property tycoon.

Buy to let is still a good source of income even with the Government screwing over landlords. I’m always banging on about capital growth, so purchasing a Buy to Let should be a long term plan and not for the faint hearted, buy today and jump tomorrow.

*** If you are thinking of getting into the property rental market and don’t know where to start, speak to us for impartial advice and guidance to get the best return on your investment. For more information about other potential investment properties that we could introduce you to, or to ask about our thoughts on your own investment choices, call us now on 01827 425195, you can always email me on Lorraine@hallandthompson.co.uk***

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Tips to Maintain your Tamworth Buy To Let Investment

Landlords, I’m sure you would tend to agree that the majority of tenants do not take a great deal of care with your property, probably due to the fact that they have no financial responsibility with the property, apart from perhaps the deposit.

Maintain your buy to let

Maintain your buy to let

 

How many tenants cause accidental damage in a property and do not inform their landlord knowing that they would be expected to pay for the repair or replacement, however if a problem arises that is down to the landlord to rectify, the tenants are soon making contact.

Maintenance of a property is an ongoing commitment whether it be your own home or a buy to let and can be a drain  on your finances.  Buy to let  landlords need to be practical, versatile and pragmatic ensuring that any investments work both financially and do not make you time poor.

Buy to let properties take a beating, so my advice is to decorate with that in mind. Rather than getting the cheapest fixtures and fittings it’s often more cost effective to spend a little more – “don’t spoil the ship for an hapeth of tar”

My top tips for maintaining your buy to let

Ensure that you carry out regular inspections and make a note of urgent and none urgent jobs.  Have a time schedule of jobs to be carried out.

Avoid mould in the property, it’s easier to keep mould at bay than deal with it, once it appears.  Send information leaflets to your tenants at regular intervals, they need to do their bit. Would and air brick help circulate the air or how about vents in double glazing, both items can be installed fairly cheaply.

If your tenants give notice to vacate, make an early visit to see what will need doing once they have gone. If you are using contractors you will need to book them in advance as good contractors are usually booked solid for weeks and weeks.

Pay close attention to bath seals and sink surrounds and replace the sealant before it becomes unsightly. I always carried a box in the boot of my car for those little jobs which I could do myself,  along with the usual screwdrivers there was filler, no nails, a tube of sealant, a sealant gun and heavy duty wipes. Little jobs that I could complete myself and in the process save myself a few pounds, thus not having to pay contractors.

Use hard wearing, good quality carpets or laminate flooring, cheap carpets are often false economy and tend to require replacing every couple of years. Laminate  flooring is both practical and looks attractive.

Gone are the days when we painted every wall Magnolia, why not use light greys or greens and give those rooms a homely feel and use the rooms natural light.

If you provide the white goods in a property, why not take out the extended warranty. How many times has the 1 years manufacturers warranty just expired and  your washing machine, for instance, has broken down. For the sake of a few pounds a month  you could potentially save hundreds of pounds in call out charges and parts over time. What about boilers, the call out charge alone can be £80.00, the cost soon mounts up.

I know quite a few landlords who do not fit cookers in properties, it’s then the tenants responsibility to supply and maintain their own. If central heating is fitted, many landlords do not have fires in the properties, this also saves on maintenance costs.

Keep spare floor and wall tiles so that you can easily replace damaged ones, it’s quite surprising how quickly ranges or colours of tiles are no longer available.

If you are letting a property furnished, work with neutral colours and don’t fill the property with unnecessary items.  Allow tenants to put their own mark on their home, they may look after the property better if it feels as though it’s their home and not just a rental property.

Maintaining your buy to let will benefit  you in the long run and be less hassle.

 

If you are thinking of getting into the property rental market and don’t know where to start, speak to us for impartial advice and guidance to get the best return on your investment. For more information about other potential investment properties that we could introduce you to, or to ask about our thoughts on your own investment choices, call us now on 01827 425195, you can always email me on Lorraine@hallandthompson.co.uk

Don’t forget to visit the links below to view back dated deals and Tamworth Property News.http://www.Tamworthpropertyblog.co.uk

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How do Transport links effect the Tamworth Property Market?

It might surprise you that it isn’t always the poshest villages around Tamworth or the swankiest Tamworth streets where properties sell and let the quickest. Quite often, it’s the ones that have the best transport links. I mean, there is a reason why one of the most popular property programmes on television is called Location, Location, Location!

How do transport links effect the Tamworth property marketAs an agent in Tamworth, I am frequently confronted with queries about the Tamworth property market, and most days I am asked, “What is the best part of Tamworth and its villages to live in these days?”, chiefly from new-comers.  Now the answer is different for each person – a lot depends on the demographics of their family, their age, schooling requirements and interests etc. Nonetheless, one of the principal necessities for most tenants and buyers is ease of access to transport links, including public transport – of which the railways are very important.

Official figures recently released state that, in total, 1,578 people jump on a train each and every day from Tamworth Train station. Of those, 454 are season ticket holders. That’s a lot of money being spent when a season ticket, standard class, to London is £6,520 a year.

So, if up to £2.96m is being spent on rail season tickets each year from Tamworth, those commuters must have some impressive jobs and incomes to allow them to afford that season ticket in the first place. That means demand for middle to upper market properties remains strong in Tamworth and the surrounding area and so, in turn, these are the type of people whom are happy to invest in the Tamworth buy to let market – providing homes for the tenants of Tamworth…

The bottom line is that property values in Tamworth would be much lower, by at least 3% to 4%, if it wasn’t for the proximity of the railway station and the people it serves in the town

And this isn’t a flash in the pan. Rail is becoming increasingly important as the costs associated with car travel continue to rise and roads are becoming more and more congested. This has resulted in a huge surge in rail travel.

Overall usage of the station at Tamworth has increased over the last 20 years. In 1997, a total of 398,197 people went through the barriers or connected with another train at the station in that 12-month period. However, in 2016, that figure had risen to 1,148,686 people using the station (that’s 3,156 people a day).

How transport links effect the Tamworth property market

How transport links effect the Tamworth property market

The juxtaposition of the property and the train station has an important effect on the value and saleability of a Tamworth property. It is also significant for tenants – so if you are a Tamworth buy to let investor looking for a property – the distance to and from the railway station can be extremely significant.

One of the first things house buyers and tenants do when surfing the web for somewhere to live is find out the proximity of a property to the train station. That is why Rightmove displays the distance to the railway station alongside each and every property on their website.

For more thoughts on the Tamworth Property market – please visit the Tamworth Property Blog https://www.tamworthpropertyblog.co.uk

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Hard Brexit could cause 550 properties to be dumped onto the Tamworth Property market

So all cards up in the air! A general election will be on the books, but one thing is for sure … whoever gets the job to deal with Brexit has a hard job on their hands (I’m just glad its not me!) As it currently stands, by not assuring the rights of EU citizens in the UK, Theresa May has squandered an opportunity to give peace of mind to our EU co-workers working and living in Tamworth (and the rest of the UK). No.10 Downing Street’s point of view is that in promising the rights of EU citizens in the UK, it will postpone the same guarantee to the 1.5 million UK citizens living in the other nations of the EU.

Putting aside the politics for one second, the simple fact is now Article 50 has been triggered, we have two years to make a deal with the EU; otherwise it will be a ‘hard Brexit’. Now you might not think a hard Brexit will affect you in your home in Tamworth … but nothing could be further from the truth.

Tamworth property market could see 100's of properties dumped with a hard brexit!!
Tamworth property market could see 100’s of properties dumped with a hard brexit!!

Of the 76,446 people who are resident in the Tamworth Borough Council area, 73,628 were born in the UK, 850 were born in EU countries from West Europe and 794 were born in EU countries from the former Soviet States in East Europe (the rest coming from other countries around the world).

The rights of these EU citizens living in the Tamworth area are not guaranteed and will now be part of the negotiation with Europe. It is true a lot of our EU next door neighbours in Tamworth will have acquired rights relating to the right to live, to work, to own a business, to possess a property, the right to access health and education services and the right to remain in a UK after retirement… yet those acquired rights are up for negotiation in the next two years.

So, what would a hard Brexit do to the Tamworth property market?

Well a hard Brexit could mean the nuclear option when it came to the Tamworth housing market. It could mean that every EU citizen would have to leave the UK.

In the Tamworth Borough area, 590 of the 850 Western European EU citizens own their own home and (so they would all need to be sold) and 525 of the 794 Eastern European EU citizens rent a property, so again all those rental properties would all come on the market at the same time.

Hard Brexit and mass EU Migration would mean c. 550 properties being dumped onto the housing market in a short period of time, meaning there would be a massive drop in Tamworth property values and rents, causing negative equity for thousands of Tamworth homeowners and many buy-to-let landlords would be out of pocket.

While there is no certainty as to what the future will hold, both UK expats in the EU and EU citizens in the UK rights will no longer be guaranteed and will be subject to bilateral renegotiation.

All I ask is that the politicians are sensible with each other in the negotiations. A lot of the success of the Tamworth (and UK) property market has been built on high levels of home ownership and more recently in the last 10/15 years, a growth of the rental sector with lots of demand from Eastern Europeans coming to Tamworth (and the surrounding area) to get work and provide for their families. Many Tamworth people have invested their life savings into buying a buy to let property.

Much will depend on what is politically realistic. Unilateral knee-jerk reactions and measures caused by a hard Brexit would not only likely cause major disruption or suffering to the 3 million EU citizens living in the UK, but also everyone who owns property in the UK … politics aside – a hard Brexit is in no one’s interests.

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 Tamworth Property Market, together with regular postings on what I consider the best buy to let deals in Tamworth (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 on Lorraine@hallandthompson.co.uk or call on 07531484956.

Don’t forget to visit the links below to view back dated deals and Tamworth Property News. https://www.tamworthpropertyblog.co.uk

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