Following on from my recent article about the state of the Epsom property market and in particular what had happened to the rents Epsom tenants have had to pay since the Credit Crunch. If you recall, I mentioned rents in Epsom are 7.4% higher than they were in 2008. An Epsom landlord has since rung me after reading the Epsom Property Blog, wanting to know more of the story of what was happening to current rents in the town. The reason he asked was that his current agent hadn’t increased his rent for a number of years and was concerned if he was getting the best return from his Buy to Let investment.
The Epsom rental market is all about supply and demand (isn't it so in all parts of the economy?). On
the supply side, 98 rental properties have come up for let in the last 31 days in Epsom. It sounds a lot
until you consider there are 2,450 rental properties in Epsom, that means only 4% of the rental stock
of properties in Epsom are coming onto the market each month (it is normally around 5%). One
reason for this lack of new rental properties coming on the market is the fact that tenants seem to
be staying in properties longer.
With this lack of supply, newer tenants have to pay more to secure the property they want. And this
is the crux of the matter ...properties they want. Older properties in Epsom, that haven’t been
maintained as well as perhaps a new build, still retain some dated finishes in terms of
kitchen/bathrooms and decor which have seen their rents drop. Tenants want either modern
properties with all the mod cons or older style properties that have been presented to an
exceptional standard – and they are prepared to pay for the privilege. Rents for top quality
properties in Epsom have risen by 0.5% in the last month. Any properties, old or modern, put on the
market in good or excellent condition will rent in a matter of days. Not just this, but better standards
means better tenants.
Interestingly, looking at Epsom property values, the Land Registry have just released their latest set
of data on property values. Throughout April 2015 (the latest set of data), property values rose in
Epsom, with 0.5% growth, meaning they are now 10.8% higher than they were a year ago. When
one looks at the regional picture, the South East average property values rose by 0.8% in the last
month. The difference doesn’t concern me, as the regional and local property values always even
themselves out over the months.
Looking forward, after considering all the statistics and talking to other property professionals, I
expect property values in Epsom to rise by 3% to 5% over the coming 12 months, following the
Conservative victory. In a forthcoming article, I will discuss how the number of properties changing
hands each month has dropped considerably in the last 10 to 15 years in the town.
...And so back to our landlord. Each property is unique and so as his tenancy agreement allows him
to inspect the property with notice to the tenant, we will be visiting the property next week with him
to accept his instructions. For more in depth thoughts and opinions like this on the Epsom Property
market keep checking back here at the Epsom Property Blog or email