tag:blogger.com,1999:blog-75652384051853553292024-03-27T23:53:23.424+00:00The Epsom Property BlogAnonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.comBlogger73125tag:blogger.com,1999:blog-7565238405185355329.post-65286755143550451122019-01-22T22:07:00.002+00:002019-01-22T22:07:31.899+00:00Epsom Property Newsletter - Winter 2019<span style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 15.84px;">This is our latest newsletter, which we hope you enjoy reading. Naturally should you have any questions or queries, please feel free to contact Ian directly on </span><a href="mailto:ian@directresidential.co.uk" style="background-color: white; color: #aa223a; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 15.84px; text-decoration-line: none;">ian@directresidential.co.uk</a><br style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 15.84px;" /><br style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 15.84px;" /><span style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 15.84px;">We hope you enjoy the articles! </span><a href="https://drive.google.com/file/d/0B1sZiULZxBQ3dDZsMzRLZlQ4T0FUblJLX2NTY3k5aEdDa1B3/view?usp=drivesdk" style="background-color: white; color: #aa223a; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 15.84px; text-decoration-line: none;" target="_blank">Click here to view the newsletter.</a>Danielhttp://www.blogger.com/profile/06423284885012930499noreply@blogger.com69tag:blogger.com,1999:blog-7565238405185355329.post-69644381846327330172018-08-21T13:51:00.000+01:002018-08-21T13:51:16.674+01:00Epsom Property Newsletter - Summer 2018This is our latest newsletter, which we hope you enjoy reading. Naturally should you have any questions or queries, please feel free to contact Ian directly on <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a><br />
<br />
We hope you enjoy the articles! <a href="https://drive.google.com/file/d/1OGZPxzTRJCZ-b01rnIz1vwEygbOLoVIZ/view?usp=sharing" target="_blank">Click here to view the newsletter.</a>Danielhttp://www.blogger.com/profile/06423284885012930499noreply@blogger.com10tag:blogger.com,1999:blog-7565238405185355329.post-91206160251240969452017-11-29T18:24:00.000+00:002018-08-21T13:51:06.930+01:00Epsom Property Newsletter - Winter 2017This is our latest newsletter, which we hope you enjoy reading. Naturally should you have any questions or queries, please feel free to contact Ian directly on <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a><br />
<br />
We hope you enjoy the articles! <a href="https://drive.google.com/file/d/1_5fWYlgA6C6OR9wNgL9BpLgOLdtrR2iI/view?usp=sharing" target="_blank">Click here to view the newsletter.</a>Danielhttp://www.blogger.com/profile/06423284885012930499noreply@blogger.com368tag:blogger.com,1999:blog-7565238405185355329.post-5797933577622748252017-05-02T21:44:00.000+01:002017-05-02T21:44:09.048+01:00Epsom Property Newsletter - Spring 2017This is our latest newsletter, which we hope you enjoy reading. Naturally should you have any questions or queries, please feel free to contact us.<br /><br />We will be starting a new section in our next Newsletter entitled, 'Ask the Specialist', where you can email in questions about your tenancy or any property/management related topics, which we will answer. If you have such a question now, please email Ian as follows.<br /><br />We have also been asked recently for details of how to switch agents to Direct Residential for managing a property, which is proving very popular. If this is of interest to you, please contact Ian directly on <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a><br /><br />We hope you enjoy the articles! <a href="https://drive.google.com/file/d/0B1sZiULZxBQ3WlZlWjV1WV9Nd3M/view?usp=sharing" target="_blank">Click here to view the newsletter.</a>Danielhttp://www.blogger.com/profile/06423284885012930499noreply@blogger.com20tag:blogger.com,1999:blog-7565238405185355329.post-57090231702340714592016-10-05T19:31:00.002+01:002016-10-05T19:31:21.399+01:00Epsom Property Newsletter - Autumn 2016<span style="background-color: white; font-family: "arial" , "tahoma" , "helvetica" , "freesans" , sans-serif; font-size: 13px; line-height: 18.2px;">Here is the autumn edition of the Epsom Property Newsletter which is a great way to catch up on the latest news from this blog.</span><br />
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<a href="https://drive.google.com/file/d/0B1sZiULZxBQ3TXdBdGEteGg1SG8/view?usp=sharing" target="_blank">You can download and view the newsletter by clicking here.</a>Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com14tag:blogger.com,1999:blog-7565238405185355329.post-68247485149476814792016-06-24T16:33:00.001+01:002016-06-24T16:33:58.527+01:0047.9% of Epsom & Ewell Voters voted to leave the EU – What now for the 10948 Epsom Landlords and Homeowners?It’s 5.50am as I start to type this article and David Dimbleby has just announced the UK will be leaving the EU as the final votes are counted. As most of the polls suggested a Remain Vote, it came as a surprise to most people, including the City. The Pound has dropped 6% this morning after the City Whiz kids got their predictions wrong and MP’s from the Remain camp are using words like “challenging times ahead”.<br />
<br />
<div style="text-align: center;">
<b>.. and now the vote has been made .. what next for the 8498 Epsom homeowners especially the 4601 of those Epsom homeowners with a mortgage?</b></div>
<br />
The Chancellor in the campaign suggested property prices would drop by 18%. Using Treasury estimates, their method of calculating this was tenuous at best, but focused around the abrupt and hasty increase in UK interest rates, which in turn would raise the cost of mortgages, and therefore lower demand for property, causing a drop in property prices.… and I would say, yes .. that will probably happen.<br />
<br />
<b><u>Epsom Property Values</u></b><br />
<br />
Epsom property values will probably drop in the coming 12 to 18 months – but by 18% - I am sorry I find that a little pessimistic and believe that figure was rhetoric to get homeowners and landlords to vote in a particular way. But the UK property market is quite a monster.<br />
<br />
<div style="text-align: center;">
<b>Since the last In/Out EU Referendum in June 1975, property values in
Epsom have risen by 2132.8%</b></div>
<div style="text-align: center;">
<br /></div>
(That isn’t a typo) and whilst property prices did drop nationally by 18.7% between the peak of 2007 and bottom of the market in 2009, when one compares property values today in the country, compared to that all-time high of 2007, (the period before the financial crisis of the Credit Crunch of 2008/9) .. they are still up 10.14% higher.<br />
<br />
<b><u>Another Credit Crunch?</u></b><br />
<br />
And so, notwithstanding the Credit Crunch, the worst global economic outlook since the 1930s and the recession it brought us, a matter of a few years later, the Government were panicking in 2012/3/4 that the housing market was a runaway train.<br />
<br />
Now the same Credit Crunch doom-mongers and Sooth-Sayers that predicted soup kitchens in 2008/9 are predicting Brexit meltdown. Bad news sells newspapers. Stock markets may rise, stock markets may fall, yet the British public continued to buy property in 2009/10 and beyond. Aspiring first time buyers and buy to let landlords dusted themselves down, took a deep breath and carried on buying… because us Brit’s love our Bricks and Mortar .. we need a roof over our head.<br />
<br />
However, as mentioned previously, if the value of the pound drops, in the past UK Interest Rates have risen to reverse that drop. However, whilst a cheaper pound will make your pint of Sangria a little more expensive on your Spanish holiday this year and make your brand new BMW pricer .. it will make British export cheaper! Which is great for the economy.<br />
<b><u><br /></u></b>
<b><u>Interest rates</u></b><br />
<br />
… and what of interest rates? Since 2009, interest rates have been at 0.5% and lots of people have become accustomed to those sorts of levels. So what if interest rates rise .. end of the world? Interest rates in the 1986/88 property boom were on average 9.25%, the 1990’s they were on average around 6.5% and uber-boom years (when UK property values were rising by 20% a year for three or four straight years across the UK) .. 4.5%. Many of you reading this who are in their 50’s and older will remember interest rates at 15%.<br />
<br />
But I suspect interest rates won’t rise that much anyway, as Mark Carney (Chief of the Bank Of England) knows, raising interest rates causes deflation – which is the last thing the British economy needs at the moment. In fact they have been printing money (aka Quantitative Easing) for the last few years (which causes inflation) to the tune of £375bn a month. A bit of inflation because the pound has slipped on the money markets (not too much mind you) might be a good thing?<br />
<br />
.. because whilst property values might drop in the country, they will bounce back. It’s only a paper loss.. because it only becomes real if you sell. And if you have to sell, again as most people move up market when they sell, whilst your property might have dropped by 5% or 10%, the one you want to buy would have dropped by the same 5% to 10% .. and here is the best part – (and work your sums out) you would actually be better off because the more expensive property you would be purchasing would have come down in value (in actual pound notes) than the one you are selling.<br />
<br />
<div style="text-align: center;">
<b>The Epsom landlords of the 4,701 Epsom buy to let properties have nothing to fear neither, nor do the 11,612 tenants living in their properties.</b></div>
<br />
Buy to let is a long term investment. I think there might even be some buy to let bargains in the coming months as some people, irrespective of evidence, panic. Even if we pull up the drawbridge at Dover and immigration stopped today, the British population will still increase at a rate that will exceed the current property building level. Britain is building 139,600 properties a year, but needs according to the eminent ‘Barker Review of Housing Supply Report’, the country needs to build about 250,000 properties a year to even stand still, and as the the birth rate is increasing, the population is living longer and just under a quarter of all UK households now are occupied by a single person demand is only going up whilst supply is stifled. Greater demand than supply equals higher prices. That is definitely a fact.<br />
<b><u><br /></u></b>
<b><u>So, what will happen next?</u></b><br />
<br />
Well, there are many challenges ahead. The country has spoken and we are now in unchartered territory – but we have been through a couple of World Wars, an Oil Crisis, Black Monday, Black Wednesday, 15% interest rates and a Credit Crunch … and we survived!<br />
<br />
And the value of your Epsom property? It might have a short term wobble… but in the long term -it’s safe as houses regardless.<br />
<br />
<span id="docs-internal-guid-7a48d948-830b-6477-297c-6e14febc8087"><span style="font-family: Calibri; font-size: 14.6667px; vertical-align: baseline; white-space: pre-wrap;"><img height="256" src="https://lh5.googleusercontent.com/Py6GyMskHjWu7phO9ZZUlyqOo-TYBkwHxqSMWSn5pImA5HKORoQtG2E75WCVQ5vlckqnwxPC7XRm8aw6M8s-1AhUeBAHM4ZwnaHuANmKIMZ_158J0HsRT1Jy5PZtLMEL9wkPe3HXSXkB-yqc9g" style="border: none; transform: rotate(0rad);" width="428" /></span></span><br />
<br />
<b>Local Result - Epsom and Ewell</b><br />
Leave <b>47.9%</b> 21,707 VOTES (BLUE)<br />
Remain <b>52.1%</b> 23,596 VOTES (YELLOW)<br />
Turnout: 80.4%<br />
<br />
<b><i>National Results</i></b><br />
<b>England</b><br />
Leave <b>53.4%</b> 15,188,406 VOTES<br />
Remain <b>46.6%</b> 13,266,996 VOTES<br />
Counting complete Turnout: 73.0%<br />
<br />
<b>Northern Ireland</b><br />
Leave <b>44.2%</b> 349,442 VOTES<br />
Remain <b>55.8%</b> 440,437 VOTES<br />
Counting complete Turnout: 62.9%<br />
<br />
<b>Scotland</b><br />
Leave <b>38.0%</b> 1,018,322 VOTES<br />
Remain <b>62.0%</b> 1,661,191 VOTES<br />
Counting complete Turnout: 67.2%<br />
<br />
<b>Wales</b><br />
Leave <b>52.5%</b> 854,572 VOTES<br />
Remain <b>47.5%</b> 772,347 VOTES<br />
Counting complete Turnout: 71.7%
Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com3tag:blogger.com,1999:blog-7565238405185355329.post-42161942226447949492016-05-25T13:23:00.001+01:002016-05-25T13:23:02.444+01:00Epsom Property Newsletter - Summer 2016<span style="background-color: white; font-family: "arial" , "tahoma" , "helvetica" , "freesans" , sans-serif; font-size: 13px; line-height: 18.2px;">Here is the summer edition of the Epsom Property Newsletter which is a great way to catch up on the latest news from this blog.</span><br />
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my thoughts on the Epsom property market for the next five years. Property prices are both a British national
obsession and a key driver of the British consumer economy. So what will happen next in the property market?
So here is what I told him, and now wish, my blog reading friends, to share with you.<br />
<br />
Before I can predict what will happen over the next five years to Epsom house prices, firstly I need to look at
what has happened over the last five years. One of the key drivers of the housing market and property values is
unemployment (or lack of it), as that drives confidence and wage growth – key factors to whether people buy
their first house, existing homeowners move up the property ladder and even buy to let landlords have an
appetite to continue purchasing buy to let property.<br />
<br />
When the Tory’s came to power in May 2010, the total number of people who were unemployed in the suburb
stood at 1,051 (or 2.0% of the working age population in Epsom parliamentary constituency). Last month, this
had dropped to 375 people (or 0.7% of the working age population).<br />
<br />
As the Epsom job market has improved with better job prospects, salaries are rising too, growing at their highest
level since 2009, at 3.4% per year in the private sector (as recently reported by the ONS), property values in the
Epsom area continue to increase and are 31.03% higher today than they were five years ago.<br />
<br />
Many home occupiers have held back moving house over the past seven to eight years following the Credit
Crunch but with the outlook more optimistic, I expect at least some to seize the opportunity to move home,
releasing pent up demand as well as putting more stock onto the market. With a more stable economy in the
suburb, this will, I believe, drive a slow but clearly defined five year wave of activity in home sales and continued
house price growth in Epsom.<br />
<br />
<h3 style="text-align: center;">
<i>I forecast that the value of the average home
in Epsom will increase by 21.6% by 2021</i></h3>
<br />
21.6% might sound optimistic to some, but according to Land Registry, values are currently rising in Epsom at
8.0% year on year, I believe my forecast to be fair, reasonable and a reflection of both positive (and negative)
aspects of the local property market and wider UK economy as whole. (My forecast is based on looking at
history and economic factors, which of course could plummet as well)!<br />
<br />
However, it wouldn’t be correct not to mention those potential negative issues as I do have some slight
concerns about the future of the Epsom housing market. The number of properties for sale in Epsom is lower
than it was five years ago, restricting choice for buyers (yet the other side of the coin is that that keeps prices
higher). Interest rates were being predicted to rise around Easter 2016, but now I think it will be nearer
Christmas 2016 and finally the new buy to let taxation rules which are being introduced between 2016/7 and
2021 (although choosing the right sort of property / portfolio mix in Epsom will, I believe, mitigate those issues
with the next taxation rules).<br />
<br />
I am telling the landlords I speak to, that with interest rates at their current level 0.5%, the cash in your Building
Society Passbook is going to grow so slowly that it might as well be kept under their bed. Property prices, by
contrast, have rocketed over the years, even after the property crashes, far outstripping bank accounts and
inflation.<br />
<br />
So my final thought ... property is a long term investment, it has its’ up and downs, but it has always
outperformed, in the long term, most investments. Those in their 40’s and 50’s in Epsom would be mad not to
include property in their long term financial calculations. Just make sure you buy the right property, at the right
price in the right location. One source of information on such matters would be here at the Epsom Property Blog.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com4tag:blogger.com,1999:blog-7565238405185355329.post-886593238122235412016-01-12T14:36:00.002+00:002016-01-12T14:36:27.538+00:00How EU Migration has changed the Epsom Property MarketThe argument of migration and what it does, or doesn’t do, for the country’s economic wellbeing is
something that has been hotly contested over the last few years. In my article today, I want to talk
about what it has done for the Epsom Property market.<br />
<br />
Before we look at Epsom though, let us look at some interesting figures for the country as a whole.
Between 2001 and 2011, 971,144 EU citizens came to the UK to live and of those, 171,164 of them
(17.68%) have bought their own home. It might surprise people that only 5.07% of EU migrants
managed to secure a council house. However, 676,091 (69.62%) of them went into the private rental
sector. This increase in population from the EU has, no doubt, added great stress to the UK housing
market.<br />
<br />
Looking at the figures, the housing market as a whole is undoubtedly affected by migration but it has
been the private rented housing sector, especially in those areas where migrants come together,
that is affected the most. Indeed, I have seen that many EU migrants often compete for such
housing not with UK tenants but with other EU migrants. In 2001, 3.68 million rented a property
from a landlord in the UK. Ten years later in 2011, whilst EU migration added an additional 676,091
people renting a property from a landlord, there were actually an additional 4.14 million people who
became tenants and were not EU migrants, but predominately British!<br />
<br />
As a landlord, it is really important to gauge the potential demand for your rental property,
especially if you are a landlord who buys property in areas popular with the Eastern European EU
migrants. To gauge the level of EU migration (and thus demand), one of the best ways to calculate
the growth of migrants is to calculate the number of people who ask for a National Insurance
number (which EU members are able to obtain).<br />
<br />
In Epsom and Ewell migration has risen over the last few years. For example, in 2005 there were 545
migrant national Insurance cards (NIC) issued and the year after in 2006, 535 NIC cards were issued.
In 2014, this had increased to 674 NIC’s. However, if the pattern of other migrations since WW2
continues, over time there will be an increasing demand for owner occupied property, which may
affect the market in certain areas of high migrant concentration. On the other hand, over time some
households move into the larger housing market, reducing concentrations and pressures.<br />
<br />
In essence, migration has affected the Epsom property market; it couldn’t fail to because of the
additional 5,374 working age migrants that have moved into the Epsom and Ewell area since 2005.
However, it has not been the main influence on the market. Property values in Epsom today are
45.37% higher than they were in 2005. According to the Office of National Statistics, rents for
tenants in the South East have only grown on average by 0.95% a year since 2005 .... I would say if it
wasn’t for the migrants, we would be in a far worse position when it came to the Epsom property
market. This was backed up by the then Home Secretary Theresa May back in 2012 - more than a
third of all new housing demand in Britain is caused by inward migration and there is evidence that
without the demand caused by such immigration, house prices would be 10% lower over a 20 year
period.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com1tag:blogger.com,1999:blog-7565238405185355329.post-51802693105385159332015-12-03T12:19:00.004+00:002015-12-03T12:19:32.016+00:00Epsom Property Market Crisis as New House Building slumps by 55.77%One of the key factors that determine the price of anything is the demand and supply of the item
that is being bought and sold. When it comes to property, demand can change overnight, but it
takes years and years to build new properties, thus increasing the supply.<br />
<br />
The Conservatives have pledged to build over 1 million homes by 2020. I am of the opinion that as a
country, irrespective of which party, we have not built enough homes for decades and if the gap
between the number of households forming and the number of new homes being built continues to
grow, we are in danger of not being able to house our children or grand children. I believe the
country is past the time for another grand statement of ambition by another Housing Minister.
Surely it’s right to give normal Epsom families back the hope of a secure home, be that rented or
owned? As a town, we need to exert pressure on our local MP Chris Grayling, so they can make sure
Westminster is held accountable, to ensure there is a comprehensive plan, with enough investment,
that can actually get these homes built. Indeed the increase in stamp duty by 3% to buy to let
investors will help, but will this be enough for the building?<br />
<br />
To give you an idea of the sorts of numbers we are talking about, in the Epsom and Ewell Borough
Council area in 2007, 340 properties were built; in 2013 it peaked at 520. By 2014, that figure had
dropped by a massive 55.77% to 230 properties built.<br />
<br />
The outcome of too few homes being built in Epsom means the working people of the town are
being priced out of buying their first home and renters are not getting the quality they deserve for
their money. The local authority isn’t building the estates they were after the war and housing
associations are having their budgets tightened year on year, meaning they have less money to
spend on building new properties. I know of many Epsom youngsters, who are living with their
parents for longer because they cannot afford to get onto the housing ladder and growing families
are unable to buy the bigger homes they need.<br />
<br />
I talk to many Epsom business people and they tell me they need a flexible and mobile workforce,
but the high cost of moving home and lack of decent and affordable housing are barriers to
attracting and retaining employees. Furthermore, building new homes is a powerful source of
growth, creating jobs across the county and supporting hundreds of Epsom businesses. It is true that
landlords have taken up the mantle and over the last 15 years have bought a large number of
properties. The Government need to be thankful to all those Epsom landlords, who own the 2,450
rental properties in the borough. Most local landlords only have a handful of rented properties (to
aid their retirement), and without them, I honestly don’t know who would house all the extra people
in Epsom!<br />
<br />
Moving forward, those Epsom landlords have many pitfalls, both in the short term and medium
term. For instance, were you aware that the rules on changes for new tenancies from the 1st October
2015 (with some imposing penalties including loosing the right to require the tenant to vacate, if
they are done incorrectly) or in the medium term, the planned change in the way buy to let’s are
taxed?<br />
<br />
More than ever, the days of buying any old property in Epsom and you would be set for life are
gone. Now, it’s all about ensuring you stay the right side of the law, buying the right property (and
that might mean even selling some to buy others), so you build the right portfolio for you as a
landlord. One source of info on all of these issues, where you will find other articles similar to this on
the Epsom property market, is here at the Epsom Property Blog.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com3tag:blogger.com,1999:blog-7565238405185355329.post-11181628925494194732015-11-30T16:44:00.000+00:002015-11-30T16:44:27.918+00:00Epsom Property Newsletter - November 2015<span style="background-color: white; font-family: "arial" , "tahoma" , "helvetica" , "freesans" , sans-serif; font-size: 13px; line-height: 18.2px;">Here is the sixth issue of the monthly Epsom Property Newsletter which is a great way to catch up on the latest news from this blog.</span><br />
<span style="background-color: white; font-family: "arial" , "tahoma" , "helvetica" , "freesans" , sans-serif; font-size: 13px; line-height: 18.2px;"><br /></span>
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<a href="https://drive.google.com/file/d/0B1sZiULZxBQ3S0luckdGZDV3eXc/view?usp=sharing" target="_blank">You can download and view the newsletter by clicking here.</a>Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com2tag:blogger.com,1999:blog-7565238405185355329.post-84128546945395380822015-11-26T16:47:00.005+00:002015-12-03T12:18:22.037+00:00Epsom House owners desert the housing market with an 8 year lowEven though the housing market is in an upbeat state in many parts of the UK, getting on the
property ladder is still challenging for many and regarded as unattainable by some. However, that
goal has become even worse recently in Epsom as the number of houses available to buy is at an 8
year all time low.<br />
<br />
Back in Summer 2008, there were over 1,225 properties for sale in Epsom and since then this has
steadily declined year on year, so now there are only 352 for sale in the suburb. This continuing
diminishing supply of housing has been happening over those years for a while and there simply
aren’t enough properties in Epsom to match demand.<br />
<br />
According to a recent report by the National Association of Estate Agents, that said, “There are now
11 house hunters fighting after every available house which isn’t sustainable.” What that means is
Epsom youngsters, who are looking to buy their first home, are finding themselves being squeezed
out by the competition. However, in the meantime, nobody wants to live with parents until they are
in their 30’s, so that in turn creates demand for more rental properties, which means landlords have
a greater demand for more rental properties so are buying more, resulting in even less smaller
properties for the youngsters to buy; it’s a vicious circle.<br />
<br />
Talking to fellow agents, mortgage arrangers, surveyors and solicitors in the suburb, all of whom
have extensive dealings in the Epsom property market like myself, most of us agree the movement
in the Epsom market is taking place in the middle to upper market, higher up the property ladder
and it’s second and third steppers pushing through the properties that are being bought and sold.<br />
<br />
That has meant as people tend to move less in the middle to upper market, the number of the
properties actually selling has drastically reduced over the last couple of years.<br />
<br />
When we look at the individual areas of the suburb, it paints an interesting picture.<br />
<br />
<ul>
<li><b>KT17 </b>- Epsom, Ewell, Stoneleigh - 24 properties sold in May 2015 (with an average value of
£498,956), whilst over the Autumn months of 2014, the number of properties selling in this
postcode reached into the mid/late 40’s.</li>
<li><b>KT18 </b>- Epsom, Tattenham Corner, Headley, Langley Vale - 24 properties sold in May 2015
(the most recent set of figures from the HM Land Registry), whilst over the Summer months
of 2014, the number of properties selling in this postcode was always between 34 and 41
per month. (Interestingly the average value of those properties was £473,141).</li>
<li><b>KT19 </b> - Epsom, West Ewell, Stoneleigh, Horton, Longmead - 34 properties sold in May 2015
(with a average value of £418,541), whilst over the Summer months of 2014, the number of
properties selling in this postcode reached into the mid 70’s. </li>
</ul>
<br />
So what does this all mean for homeowners and landlords alike in Epsom? Demand for Epsom
property is good, especially at the lower end of the market. However, with fewer properties coming
up for sale, it means property prices are proving reasonably stable too.<br />
<br />
You see I believe a more stable, consistent Epsom property market, with less people seeing property
as an easy way to make a quick buck (as many did in the early 2000’s when prices were rising at
nearly 20% a year so people were buying and selling every other minute), but a property market that
has a steady growth of property values in Epsom, year on year, without the massive peaks and
troughs we saw in the late 1980’s and mid/late 2000’s might just be the thing that the Epsom
property market needs in the long term.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com2tag:blogger.com,1999:blog-7565238405185355329.post-4121293349169418952015-11-20T10:49:00.002+00:002015-11-20T10:49:19.527+00:00Could your Epsom property save you from Pension oblivion?If you were born in the early 1970’s or late 1960’s, if you haven’t started to think about it yet,
retirement is closer than you think. In fact the number of years you have left to work is less than the
number of years you have worked. The basic state pension is worth £115.95 a week for a single
person in 2015/16 (or £6,029 a year) and £231.90 a week for a couple (£12,118 a year) as long as
your partner has paid their stamp (although there are certain get of jail cards if they haven’t).<br />
<br />
As a household, could you live on just over £12k a year?<br />
<br />
However, could the property you are living in in Epsom save you from poverty when you reach
retirement? You see, a regular income is vital in retirement and the bricks and mortar you own in
Epsom could provide a way for you to finance life when you retire.<br />
<br />
If you are in your 30’s, instead of saddling yourself with bigger and bigger mortgages, going from
your first time buyer flat, to a terraced, to the semi and then the large detached house, you could
instead keep your terraced or semi, invest in a buy to let property and let the rent pay the mortgage
and rely on capital growth to provide you with a lump sum when you sell the property and retire.
One of the biggest plus points of buy to let is what is known as leverage. Let me explain ... say you
have a deposit of 25% and the value of the property rises by 3% a year, your gains in fact multiply to
12%. However, if property prices drop, 'leverage' can be catastrophic, as losses will also be
multiplied. Property values have dropped a number of times in the last 50 years, but they always
seem to bounce back ... property must be seen as a long term investment.<br />
<br />
Let me explain how leverage could work for you. If you had bought an Epsom house in Spring of
1983 for £70,000, using a 75% mortgage and 25% deposit, (meaning your deposit would be
£17,500). Today, that Epsom property would have risen in value to £506,653, a rise of 623.8%.
However, when you look at the growth on just your deposit, the rise is even better ... instead of
623.8%, we see a rise of 2795% (remembering that the mortgage would have been paid off).<br />
<br />
However, buy to let is not all about capital growth in retirement, income is more important than
capital growth, as rent is the key to a steady income.<br />
<br />
So surely the best strategy is to buy those Epsom properties with the high rents (when compared to
the value of the property). These are called high yield properties in the buy to let world because the
monthly return is so much greater. So surely they are the best in Epsom? Possibly, but the properties
that offer these higher yields (in the order of 5% to 6% per year) tend to be in such areas as
Longmead or Watersedge in Epsom, historically they haven’t offered such good capital growth when
compared to the average and sometimes have a higher tendency for void periods and maintenance.<br />
<br />
Therefore, if a high maintenance rental portfolio wasn’t for you, another strategy could be buy a
property with relatively smaller rental returns of 3% to 4% per year (i.e. lower yields), but in a more
up market area such as Woodcote. Properties such as these tend to suffer from less void periods (i.e.
when there is no tenant in the property paying you rent) and they historically have had better long
term capital growth when compared to the town average.<br />
<br />
Every landlord is different and every property is different. All I suggest to you is do your homework.<br />
<br />
As regular readers will know, I am happy to share my knowledge and experience of the Epsom
property market, high yields, high capital growth, what to buy, what not to buy and where to buy in
the Epsom Property market, which can always be found here at the Epsom Property Blog or email me at <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com1tag:blogger.com,1999:blog-7565238405185355329.post-57761296466386519262015-11-11T14:26:00.006+00:002015-11-11T14:26:58.280+00:00Southfield Park catchment area properties outperform Epsom average by 52.58%I was having a chat with an Epsom property investor the other day, when he asked if schools,
especially primary schools, affected the local property market in terms of demand from buyers and
tenants to a property. Anecdotally, I have always known this to be true, a good school creates good
demand and good demand does affect house prices. So, I asked my colleagues on the front line,
who take the phone calls from people putting themselves on our mailing list and they confirmed that
most people cite location as their number one factor.<br />
<br />
After looking through our mailing list, it confirms there is a close correlation between the high
demand areas of Epsom and the close proximity to a good primary school. Talking to my team in a
recent morning meeting, they agreed many people would look to increase their budget quite
significantly, whilst others would consider downgrading their property requirements to be close to a
good primary school.<br />
<br />
Those of you who regularly read this blog will know I like a challenge, so I decided to look at the
science behind these assumptions. According to the School Guide website, Southfield Park Primary
School is one of the best primary schools in Epsom. Its figures are certainly impressive. Their last
Ofsted Report classified it as Outstanding, 93% of 11-year pupils achieving Level 4 or above in maths,
reading and writing whilst 47% of them achieved level 5. Finally, the schools’ KS2 rating was classed
as Excellent.<br />
<br />
Looking at property sales within half a mile of Southfield Park, property values have risen in value
since 1999 by 217.36%, whilst according to recent figures, the Epsom average as a whole has risen in
the same time frame by 142.46%.<br />
<br />
<b><i>That means the parents of Southfield Park have seen the values of their properties rise
<u>proportionally</u> 52.58% more than the Epsom average ... interesting don’t you think?</i></b><br />
<br />
However, whilst a good primary school significantly contributes more to house prices, the same can’t
be said for secondary schools. There are two reasons for this, firstly, as secondary schools are much
larger, so their catchment areas are correspondingly much larger, meaning parents don’t need to
live so close to the school. Secondly, in the UK, whilst the difference between the top 25% and
bottom 25% of secondary schools is not insignificant, in the primary school sector, the difference
between the top 25% and bottom 25%, according to the London School of Economics, is
considerably and significantly more.<br />
<br />
Many other Epsom landlords, both who are with us and many who are with other Epsom agents and
also potential investors pop in for a coffee or ring/email me to discuss the Epsom property market,
to consider how Epsom compares with its closest rivals and hopefully we can answer all their
questions. You must take lots of advice and seek out the best opinion. One good specific source is here at the Epsom Property Blog or you can email me at
<a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a> for some honest and straight talking advice.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com1tag:blogger.com,1999:blog-7565238405185355329.post-26904633640324869412015-11-04T12:35:00.003+00:002015-11-04T12:35:27.201+00:00Epsom’s £2.07 billion Mortgage Powder KegEight years ago, in the summer of 2007, hardly anyone had heard of the term ‘credit crunch’, but
now the expression has entered our daily language and even the Oxford Dictionary. It took a few
months throughout the autumn of 2007, before the crunch started to hit the Epsom Property
market, but in November / December 2007 and for the following seventeen months, Epsom
property values dropped each and every month like the proverbial stone. The Bank of England soon
realised in the late Summer of 2008 that the British economy was stalling under the continued
pressure of the credit crunch. Therefore, between October 2008 and March 2009, interest rates
dropped six times in six months from 5% to 0.5% to try and stimulate the British economy.<br />
<br />
Thankfully, after a period of stagnation, the Epsom property market started to recover slowly in
2010, but really took off strongly in late 2013 / early 2014 as property prices started to rocket.
However, the heat was taken out of the market in late 2014/early 2015, with the new mortgage
lending rules and some uncertainty, when some people had a dose of pre–election nerves.<br />
<br />
With the Conservatives having been re-elected in May, the Epsom property market regained its
composure and in fact, there has been some ferocious competition among mortgage lenders, which
has driven mortgage rates to record lows. Whilst I have no actual figures to back this up, I know an
awful lot of long serving bank managers, mortgage arrangers and people in the finance industry, all
of whom have told me on previous occasions when interest rates rose (1987, 1992, 1997 and 2003),
it wasn’t the first rate rise that was the catalyst for many homeowners and landlords to remortgage,
but the second or third increase. The reason being that it was only by the time of the third rate rise,
it started to hit the wallet. However, the issue is, by the time of the second or third rate rise the best
fixed rates, were in all instances, no longer available as they had been pulled by the banks months
before.<br />
<br />
But here is the good news for Epsom homeowners and landlords, over the last few months a
mortgage price war has broken out between lenders, with many slashing the rates on their deals to
the lowest they have ever offered. I read that the well respected UK financial website Moneyfacts
said only a couple of weeks ago, the average two year fixed rate mortgage has fallen from 3.6%
twelve months ago to just under 2.8%.<br />
<br />
Interestingly, according to the Council of Mortgage Lenders, the level of mortgage lending had
soared to a seven year high in the UK. So what about Epsom? In Epsom, if you added up everyone’s
mortgage, it would total £2.07 billion. Even more interesting is when we look at Epsom and split it
down into the individual areas of the town,<br />
<br />
<ul>
<li>KT17 - Epsom, Ewell, some of Stoneleigh <b>£697.1m</b></li>
<li>KT18 – Epsom, Tattenham Corner, Headley, Langley Vale <b>£471.9m</b></li>
<li>KT19 - West Ewell, some of Stoneleigh, Horton, Longmead <b>£900.9m</b></li>
</ul>
<br />
Since 1971, the average interest rate has been 7.93%, making the current 0.5% very low. So, if
interest rates were to rise by only 2%, according to my research, the 11,920 Epsom homeowners,
who have a variable rate mortgage would, combined, have to pay an approximate additional
£23,958,700 a year in mortgage payments. That means every Epsom homeowner with a variable
rate mortgage, will on average have to pay an additional £3,473 a year or £289 a month in interest
payments.<br />
<br />
I know over the last couple of posts, I have talked about mortgages a lot however, I am not a
mortgage arranger, but a property letting agent and as regular readers know, I always talk about
what I consider to be the most important issues when it comes to the Epsom Property market and at
the moment, in my humble opinion, this is the most important thing!<br />
<br />
Buy to let is all about maximising your investment, increasing income and reducing costs. I give
advice, opinions, thoughts, concerns, worries, expectations and fears about the Epsom Property
market in my blog on the Epsom Property Blog. If you are interested in the Epsom Property Market,
you might learn something by visiting this blog at <a href="http://www.epsompropertyblog.co.uk/">www.epsompropertyblog.co.uk</a> or you can email
me at <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com2tag:blogger.com,1999:blog-7565238405185355329.post-22697567348458327322015-11-02T12:47:00.000+00:002015-11-04T12:47:55.880+00:00Epsom Property Newsletter - October 2015<span style="background-color: white; font-family: "arial" , "tahoma" , "helvetica" , "freesans" , sans-serif; font-size: 13px; line-height: 18.2px;">Here is the fifth issue of the monthly Epsom Property Newsletter which is a great way to catch up on the latest news from this blog.</span><br />
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recently that UK interest rates will be going up in the not too distant future. Therefore, if you are
one of the 4,601 homeowners in Epsom, who own your own home with a mortgage, then you need
to consider your options and start to budget for an interest rate rise. However, if you are a landlord,
who owns one of the 2,253 rental properties in the town, whilst your exposure to interest rate rises
is lower, it is most certainly something you should be aware of.<br />
<br />
Since the spring of 2009, British interest rates have been at a record low of 0.5%. It’s not a case of if,
but when, they will rise. Some people think it will be before Christmas, although I am of the opinion,
it will be early in the New Year around Easter time, when they do rise. I also expect those rises will
be slow, steady and limited. It also depends on what happens to UK wage rises, UK inflation and the
general state of the British economy. Nevertheless, as most of us in Epsom would love to pull the
shutters and stick two fingers up to the world, we have to recognise we are part of a global economy
and global economic worries still exist to prevent an abrupt and instantaneous rate rise.<br />
<br />
Those Epsom landlords, who do have a mortgage, need to realise that as interest rates rise, their
monthly mortgage costs rise. It’s easy to say you will look at your mortgage next month and then
before you know it, Christmas will be here! Don’t forget, mortgage lenders have always removed
the juicy low rate mortgage deals a few months before interest rate rise. Speak to a qualified
mortgage arranger, there are lots of them in Epsom and seriously consider fixing your mortgage rate
now. You didn’t buy your Epsom Buy to Let property for it to become a millstone around your neck.
It’s all about mitigating your costs and maximising your income to make your Epsom Buy to Let
property the investment you want it to be.<br />
<br />
However, on the other side of the coin, two in three landlords who have bought property since
2007, have done so without a mortgage. A rise in interest rates might be a good thing. Let me give
you some background first, then I’ll explain why. Epsom landlords have see their return on
investment for their Epsom buy to let property, over the last couple of years, perform very well
indeed with Epsom property values rising by 43.36% since the Spring of 2009. However, when rates
do rise, whilst more expensive mortgage rates will ease the demand for borrowing, on the other
hand, it may temper house price growth, making the property market more competitive... and
therefore, we should see the return of some bargain property buys in Epsom!<br />
<br />
Finally though, can I ask all Epsom homeowners and Epsom landlords, who have a mortgage that
isn’t fixed, they need to recognise that rates will rise throughout 2016 to 2018 and will continue to
move steadily upwards towards more viable and feasible long term levels. However, I am not
qualified to give that advice and this is just my personal opinion, so please speak to a qualified
mortgage arranger and, if appropriate, fix your mortgage before interest rates rise. Don’t say I didn’t
warn you!<br />
<br />
In the meantime, if you are a landlord looking for a bargain now, don’t despair ... there are plenty
out there, if you know where to look! One place is Rightmove, another Zoopla and another
OnTheMarket. However, sometimes, you can’t see the wood for the trees. At the time of writing,
Rightmove had 373 properties for sale in Epsom, Zoopla 269 properties for sale in the town and
OnTheMarket 136 properties ... where do you start? A lot of savvy Epsom landlords like to visit the
Epsom Property Blog, where, <b><i>irrespective of which agent is selling
it</i></b>, I regularly post what I consider out of the hundreds of properties on the market, to be the best
buy to let deal in Epsom. Alternatively you can email me on <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com0tag:blogger.com,1999:blog-7565238405185355329.post-65717982117124947872015-10-10T12:05:00.000+01:002015-10-10T12:05:29.660+01:00Epsom Property Newsletter - September 2015<span style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18.2px;">Here is the forth issue of the monthly Epsom Property Newsletter which is a great way to catch up on the latest news from this blog.</span><br />
<span style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18.2px;"><br /></span>
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Overall, I expect future property price growth to remain firm, built on the foundations of an
improving labour market, strengthening economy and very low mortgage rates. In fact, talking to a
number of other agents in the area, mortgage arrangers and solicitors (all of whom have their direct
finger on the pulse of the Epsom property market), the steady long term growth in Epsom property
prices tied in by strong demand conditions so far this summer, alongside an underlying lack of supply
and the continued low mortgage rate environment, means the slow but steady upward momentum
of the Epsom property market is hopefully likely to continue in the second half of 2015.<br />
<br />
However, there are a couple points I wish to highlight as all my blog readers will know, I like to give a
balanced and honest opinion of what is happening in the Epsom property market. The two main
points being low interest rates and a lack of supply of property.<br />
<br />
<b><u>Interest rates first</u></b> - Mark Carney (Chief of the Bank of England) said in a speech a few weeks ago at
Lincoln Cathedral, the Bank will be seriously considering raising interest rates around Christmas
time. An upward movement in interest rates will temper demand and result in a marked slowdown
in house price growth. Mr Carney said that only six out of ten people that had a mortgage (57% to
exact) had a variable rate mortgage, compared with more than one in seven (73% to be exact) in the
Summer of 2012. Now I am not a mortgage arranger and cannot give advice, but rates are only going
in one direction, so whether you are a landlord or homeowner, this might be a time to consider
fixing your mortgage rate? Don’t say I didn't warn you!<br />
<br />
Tie this in with the stricter mortgage lending rules which were introduced in 2014, which affected
people’s ability to have larger mortgages, this means homeowners will need to be realistic in their
pricing if they want to sell. Reading other recent reports though, property owners have continued to
pay off mortgages at a faster rate while mortgage rates have been low. Therefore, when mortgage
rates rise, the affect on home movers sentiment which, given the shortage of supply, would result in
a marked slowdown in the rate of house price growth.<br />
<br />
<b><u>Shortage of Supply</u></b> – As I have mentioned in previous articles, the number of houses on the market
in Epsom is at an all time low. One reason is the large number of buy to let landlords who have
bought Epsom property over the past fifteen years. Unlike first time buyers who tend to move on
after a few years, landlords tend to keep their properties long term, meaning there are less
properties coming onto the market ... thus restricting supply and sales. In fact over the last four
months, only 5,181 properties in the Surrey County Council area have changed hands and sold,
compared to 6,599 in the same time frame in 2014, a not so insignificant drop of 21.49%.<br />
<br />
If you are planning on investing in the Epsom property market, or just want to know more, also
things to consider for a successful buy to let investment, one source of information is here at the Epsom
Property Blog or you can email <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com0tag:blogger.com,1999:blog-7565238405185355329.post-43245772499660181002015-10-02T10:54:00.004+01:002015-10-02T10:54:31.072+01:00Crisis in the Epsom Property Market…probably?I don’t know about you, but if you watch SKY News every waking hour or read the newspapers, it
always seems we as a Country, Europe or the World seem to lurch from one crisis to another.
Another week, another crisis averted. It was only last summer the soothsayers were predicting the
end of the world over the supposed house price bubble that many believed was developing in the
South. Property prices were rising at 20%+ per annum in London, only for things to ease as the
property market in the Capital showed a controlled slowdown and cooling in activity with price
growth easing to a more realistic 8% to 9% per annum. Interestingly, there was no panic when some
modest price drops were seen in some of London’s highest priced suburbs.<br />
<br />
However, this month’s crisis is the Buy to Let boom and as George Osborne always likes to be
topical, in the July emergency budget, he declared that he will start to scale back, from 2017, the tax
relief that those high income tax rate landlords with a mortgage have benefited from. The Daily Mail
ran headlines stating it was the end of the private landlord; predicting many landlords will give up on
Buy to Let altogether and we will be inundated with rental properties up for sale as landlords feel
squeezed from the market.<br />
<br />
Even Mr Carney, the Governor of the Bank of England, recently cautioned that the Buy to Let
property market could destabilise the whole UK property market. He was concerned landlords who
bought with high loan to value mortgages could be spooked if there is a property crash, they would
panic because of negative equity, sell cheaply, which would worsen house price falls.<br />
<br />
End of the world then? ... this week, yes probably, but next week ... that is another story! Before we
all go and live like a hermit in the Scottish highlands, let me explain to you my perspective on the
whole subject. As I mentioned a few weeks ago, two thirds of Buy to Let properties bought in the last
eight years have been bought mortgage free – so they won’t be affected by the Chancellors’ tax
changes. Also, something I feel is often overlooked but very important, is the fact that landlords
historically have only been able to normally borrow up to 75% of the value of the rental property. In
the last property crash of 2008, property values dropped by the not so insignificant figure of 16.69%
in Epsom, but even then, when we had the credit crunch and the world’s banking sector was on the
brink, no landlord would have been in negative equity in Epsom.<br />
<br />
I believe we have a case of ‘bad news selling newspapers’ and I believe that Buy to Let and the
property market as a whole, will carry on relatively intact. It’s true reducing tax relief will hit
landlords who pay the higher rate of income tax and this may slightly diminish Buy to Let as an
investment vehicle, but I doubt people will sell. Many landlords have been relaxed with their
investments, buying with their heart and then looking at the figures. You would never dream of
investing in the stock market without doing your homework and talking to people in the know. If you
want to make money in the Epsom property market as a buy to let landlord, it’s all about having the
right property and as you grow, the right portfolio mix to offer a balanced investment that will give
you both yield and capital growth.<br />
<br />
The Epsom Buy to Let market still offers good investment opportunities to new and experienced
alike. Those who have bought in the last twelve to eighteen months have reaped the benefit from
buying in Epsom, because the town offered a combination of reasonable house prices with
subsequently increasing rents. Property values have risen by 14.99% in the last eighteen months in
Epsom, whilst looking at rents, in Q2 2015, average rental values for new tenancies were 11% higher
than Q2 2014, which is particularly interesting as they only rose by 4.5% between Q2 2013 and Q2
2014.<br />
<br />
I cannot stress enough the importance of doing your homework. One source of information and
advice is the Epsom Property Blog where I have similar articles to this about the Epsom property
market and what I consider to be the best Buy to Let deals around at anyone time, irrespective of
which agent it is on the market with. If you haven’t visited and you are interested in the local
property market in Epsom .. you are missing out! .. www.epsompropertyblog.co.uk or email me at
<a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com1tag:blogger.com,1999:blog-7565238405185355329.post-90150146653951907312015-09-24T12:44:00.001+01:002015-09-24T12:44:09.286+01:00My concerns about the Epsom Property marketI am genuinely concerned about the Epsom property market, but in a way that might surprise you.
Rightmove announced that average ‘asking prices’ fell last month by 0.4% in the South East, leaving
them 5.8% higher than a year ago. Whilst it could be said that monthly change is very modest, in the
same period a year ago, we saw a monthly fall of 0.6% in the South East, which is more the norm
given the onset of schools breaking up and everyone going on holiday.<br />
<br />
Looking at all the data on the Epsom property market; putting aside the need for more houses to be
built in the next decade to balance out the increase in population (helped in part by inward
European migration) but not matched by a similar increase in housing being built; my research
shows there is a widening gap between what property buyers want and what is available to buy. In a
nutshell, many more buyers are looking for the smaller one and two bed properties (the typical semi
detached and smaller terraced houses/apartments), whilst there is an oversupply of the four and
five bed properties, which are the typical large detached properties available.<br />
<br />
Demand for smaller properties comes from both first time buyers and the growing number of buy to
let landlords, where it is more cost effective and efficient to buy smaller properties to let out
compared to larger properties which tend to offer poorer returns. Also, landlords with larger loans
(on those larger more expensive properties) will also be hit harder with the changes in the way tax is
paid on buy to let investments, which start in 2017.<br />
<br />
If you recall, a few weeks ago I did some research on how different types of properties had
performed in Epsom since the year 2000. I revisited those calculations and it hit me how different
types of properties had performed over the last 15 years. In a nutshell, this mismatch of demand
and supply isn’t a new phenomenon, it’s been happening under our noses for years!<br />
<br />
In the last 15 years, the average terraced house in Epsom has risen in value from £126,371 to
£399,439 whilst the detached house has risen in value from £295,097 to £816,357. Nothing seems
amiss until you look at the percentage growth. The terraced has grown in value by 216% whilst the
detached by only 177% meaning the gap between the inexpensive terrace’s and expensive detached
properties has in percentage terms narrowed enormously (this isn’t just an Epsom thing, it has
happened all across the Country).<br />
<br />
I am concerned because more houses need to be built, not only in Epsom, but in the South East and
the UK as a whole. In particular, there is specific need for more affordable starter homes for the
growing demand from both tenants (and the landlords that will buy them) and first time buyers. The
Tories need to face up to the fact that unless they can get the builders, the planners (to release more
building land), the banks (to finance it) and themselves together, to ensure long term plans can be
made, and implemented, this issue will continue to worsen.<br />
<br />
The country needs 200,000 houses a year to be built to keep up with demand, let alone reverse the
imbalance between demand and supply. Last year, only 141,040 properties were built, the year
before 135,510 and 146,850 in the year before that. This means only one thing for Epsom landlords.
Unless David Cameron starts to rip up huge swathes of the British countryside and build on acres
and acres of green belt, demand will always exceed supply when it comes to property for the
foreseeable future.<br />
<br />
Therefore, investment in the local Epsom property market as a buy to let investment could be the
best move to make as the stock market investments are possibly on the wane. Everyone is different
and trust me, there are many pitfalls in buy to let. You must take lots of advice and seek out the
best opinion. One source of opinion, specific to the Epsom property market is here at the Epsom Property
Blog or you can email me direct at <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com5tag:blogger.com,1999:blog-7565238405185355329.post-61946144846491880682015-09-22T12:39:00.000+01:002015-09-24T12:41:25.680+01:00Epsom – The 10 year Time Bomb on Home OwnershipMany people think the British obsession with owning your own home started with Thatcher in the
early 1980’s, when she allowed council tenants to buy their council houses under the right to buy
scheme. However, the growth actually started just after the Second World War. Looking at the
country as a whole in 1951 30% of residential property was owner occupied then, every ten years
that rose incrementally to 39% by 1961; 51% by 1971; 58% by 1981 and 68.07% by 2001 but after
that, it dropped to 63.4% by 2011 and continues to drop today.<br />
<br />
Young adults tend to start to think about settling down and moving out of the family home in their
early-mid twenties. After a couple of years, they will have a choice of either buying their first house
(albeit with a mortgage) or decide to privately rent for the long term (because the Council House
waiting list is measured in decades at the moment!). The ratio of people owning a house with a
mortgage verses privately renting is an extremely important guide to what people are doing about
their housing needs and what their attitude to renting vs buying is. With that in mind, within the
next ten years, I am predicting there will be more people renting privately in Epsom than own a
property with a mortgage and that the British love affair of property ownership will fade as the
decades roll on.<br />
<br />
This is a really important change in the way we live, as I explained to a local Epsom landlord the
other day, knowing when and where the demand of tenants is going to come from in the coming
decade is just as important as knowing the supply side of the buy to let equation, in relation to the
number of properties built in the town; Epsom property prices and Epsom rents.<br />
<br />
In the Epsom and Ewell Borough Council area as a whole there are 3,628 households that are
privately rented via a landlord or letting agency verses 12,219 households that are owned with a
mortgage, so my prediction appears to be outrageous. However, when we look deeper (as the devil
is always in the detail), 6,197 of those 12,219 households are 35 to 49 year olds and 3,760 are
households of 50 to 64 year olds. I would expect all the 50+ years to be paying their mortgage off as
they enter retirement as I would with some of the people in their mid/late 40’s.<br />
<br />
Meanwhile, at the other end, in the 25 to 34 age range (the age most people bought their first home
in the 1970’s/80’s/90’s) only 1,473 of the 2,587 households occupied by those 25 to 34 year olds are
owner occupiers with mortgages, because 1,114 households are privately rented. This means only
56.9% of 25 to 34 year olds have bought their house (with a mortgage). Twenty years ago, that
would have a much higher percentage of homeowners (between 75% to 85%).<br />
<br />
It can be seen that as the older generation pay their mortgages off as they start to get to retirement
and the younger generation aren’t jumping on the property ladder like they were 20 or 30 years ago,
the private rental sector will take up the slack as more and more people will want a roof over their
head, but won’t buy one but rent one. With Local Authorities and Housing Associations not building
houses anywhere near like the number of houses they were building in the 1950’s, 60’ and 70’s, the
private landlord appears to have good demand for their rental properties for many decades to come.<br />
<br />
This will create a polarisation in the housing market between those, mostly older, households who
own outright and those, mostly younger, households who rent. Our housing market is very much
turning into the European model. However, all is not lost, the younger generation will inherit their
parents properties, which in turn will enable them to buy, albeit later in life.<br />
<br />
If you are a landlord or thinking of become a landlord, and would like to read more articles like this
and other information on the Epsom Property Market, then please keep visiting the Epsom Property Blog or you can email me direct at <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com4tag:blogger.com,1999:blog-7565238405185355329.post-2713657501051636872015-09-17T15:03:00.006+01:002015-09-17T15:03:55.059+01:00George Osborne – The Epsom landlord’s friend?Well the last few weeks have been rather hectic as Epsom landlords, some who use us to manage
their properties and other landlords who just read our Epsom Property Blog, have been sending me
emails or picking the phone up to me not just about new properties to buy, but also about the new
rules on buy to let taxation announced in the recent budget. George Osborne confirmed in the
recent summer budget that the tax relief given to landlords on mortgage interest payments, on their
buy to let (BTL) properties, would be reduced over the coming years for higher rate income tax
payers. The Chancellor said the tax relief that private buy to let landlords (who pay the higher rate of
income tax) would change in 2017 from the current 45%/40% and would steadily reduce over the
following four years to the existing 20% by 2020.<br />
<br />
With 19.4% of residential property in the area of Epsom and Ewell being privately rented (as there
are 2,450 privately rented properties in the town), these changes are potentially something that will
not only affect most Epsom landlords, but also the tenants and the wider property market as a
whole. The choice of rental properties could drop, especially at the top end of the market which
could push up rents.<br />
<br />
However, Epsom landlords could protect themselves by reassigning one or more rental properties
into a company structure (e.g., a Limited Company, Partnership or Sole Trader) and by doing so, the
total tax paid is greatly reduced, because a company only pays tax on the profit. Nonetheless, before
everyone goes off setting up companies for their BTL portfolios, it must also be noted, if a sole trader
firm is started, stamp duty needs to be paid, yet if the owner is in business with a partner, they could
enjoy some stamp duty relief. The biggest tax variation is Capital Gains Tax (CGT) where the tax bill
will be much higher when you come to sell your portfolio. In essence, by going into business with
your BTL properties, you will potentially have a modest stamp duty to pay when you start, but you
will have a lot less monthly tax to pay, irrespective of the interest rate, but the CGT bill will be much
higher when you come to sell ... as you can see, it is not a ‘get out of jail card’. Now it must be
remembered, I am not a tax advisor, so you must take advice from a qualified person.<br />
<br />
Those planning to purchase a BTL property will have to factor these new rules into their calculations,
and this could affect the offers they are willing to make. However, I am not that concerned, as the
scaremonger reports fail to see the fact that two out of three BTL properties that have been bought
since 2007 have been purchased without the support of BTL mortgage. With those two thirds of
landlords paying cash for the purchase of their rental properties, that means two thirds of landlords
will be totally unaffected by the changes.<br />
<br />
So what of the future? The British love their Bricks and Mortar, it’s an asset that they can touch and
feel and has a 70 year track record of capital growth that has out stripped inflation. Buy to Let will
still be attractive to Epsom investors and let me explain why. If you invested £80,000 in Epsom
property in September 1987, today it would be worth £314,836. If you had invested the same
£80,000 in to the London Stock Market (the FTSE 100 to be exact), it would be only be worth
£229,012 today, whilst Inflation would have taken the original £80,000 and pushed it up to
£166,254.<br />
<br />
It’s true some central London landlords relying solely on the tax breaks rather than high yields may
be forced out of the market, but even those landlords could seek to recoup any losses by increasing
rents. However, those landlords may leave the market and this could constrict the availability of
rented houses even more than it is already, increasing rents and thus pushing yields even higher for
landlords and BTL investors still in the market... thus attracting new landlords into the market
because of those higher yields.<br />
<br />
The reality is, there is too much demand and not enough supply of homes for people to live in, in the
town. Official figures show the population in Epsom and Ewell is rising by 804 persons per year (i.e.,
demand rising), but only 215 properties are being built each year (i.e., supply is low). This sets up the
Epsom (and UK) property market to continue to create strong and steady returns, irrespective of any
tax loophole being there (or not as the case maybe).<br />
<br />
If the demand is there, I am happy to organise an informal Buy to Let seminar with a local Epsom
accountant one evening, whereby they can show you the options available and what might be best
for you. Therefore, if you are interested in attending, please drop me an email to
<a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a> and we will be able to get something organised very soon.Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com5tag:blogger.com,1999:blog-7565238405185355329.post-37962144556918071532015-09-08T19:31:00.001+01:002015-09-08T19:32:35.413+01:00Epsom Property Newsletter - August 2015<span style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18.2px;">Here is the third issue of the monthly Epsom Property Newsletter which is a great way to catch up on the latest news from this blog.</span><br />
<span style="background-color: white; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18.2px;"><br /></span>
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<a href="https://drive.google.com/file/d/0B1sZiULZxBQ3a2dHZTJsODlhMEk/view?usp=sharing" target="_blank">You can download and view the newsletter by clicking here.</a>Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com5tag:blogger.com,1999:blog-7565238405185355329.post-34783895101983551792015-09-03T14:42:00.000+01:002015-09-07T14:43:03.076+01:00Epsom Landlord’s mortgages top £137 million!<b>The Brits can’t stop talking about property. </b>The hot topic of discussion at the dinner parties of
Ewell, Ashtead and Cheam’s movers and shakers is the subject of the Epsom Property market, but in
particular, buy to let. These people are buying up buy to let properties quicker than an ace
Monopoly player ... or so it would seem if you read the Sunday papers. So is the buy to let market a
sure fire way to make money? Is it something everyone should be jumping into? Is it a sure fire way
to make money? The answer is Yes and No to all those questions!<br />
<br />
Firstly, the government gives tax breaks to landlords, as it allows the mortgage interest payments on
a buy to let property to be tax deductible. Also, a landlord only has to flick through Rightmove or
Zoopla, pick any property at random and agree a price. Then, find a modest deposit of 25% (often by
remortgaging their own home) which for an average Epsom terraced house, would mean finding
£99,859 for the deposit (as the average Epsom terraced house is currently worth £399,439) and
borrow the rest with a low interest rate buy to let mortgage. Finally, the landlord would rent out the
property in a matter of hours for top dollar and live happily ever after, with the rent then covering
the mortgage payments, with loads of money to spare and come retirement have a portfolio of
property that would have quadrupled in value in fifteen years. Sounds wonderful – doesn’t it? Or
does it???<br />
<br />
Let us not forgot that the half of one per cent Bank of England base rate is artificially low. The
international money markets can be fickle and if interest rates do rise quicker and higher than
expected because of some unforeseen global economic situation, that monthly profit will soon turn
into a loss as the mortgage will be more than the rent. Even though tenants are staying longer in
their rental property, tenants still come and go and my guidance to landlords is they should allow for
void periods, plus the maintenance costs of a rental property and of course, agents fees and VAT. ..
all things that eat into that profit.<br />
<br />
Interestingly, by my calculations, there are approximately 734 Epsom landlords owing in excess of
£13million in mortgages on those Epsom buy to let properties. An impressive amount when you
consider Epsom only has 0.069% of all the rental properties in the Country. It really does come down
to a number of important factors going forward to ensure you are water tight for the future. A lot of
my existing landlords are fixing their mortgage rates. One told me that the Metro Bank are currently
offering a 5 year fixed BTL remortgage rate at 3.79% for 5 years (based on a 75% loan). I don’t give
financial advice, so you must speak with a qualified mortgage advisor... but that sounds very fair!<br />
<br />
However, one thing I do know is that buy to let is a long term investment, it’s a ten, fifteen, twenty
year plan and property prices will go down as well as up. You wouldn’t dream of investing in the
stock market without advice, so why invest in the Epsom Property Market without advice? We give
bespoke detailed advice to our landlords to enable them to spot trends in the Epsom Property
Market before others, enabling them to buy better properties at better prices. For example, did you
know that flats are selling for around 2% lower than 12 months ago in Epsom yet detached
properties are selling for 19% more (with every other type in between). This means we can advise on
which properties will go up in value better (or lose less if property prices drop), we can also advise
which have lower voids and which properties have higher maintenance issues.<br />
<br />
Information on the local property market and ability to process it is the strongest asset we can give
you. As Lois Horowitz, the famous author says, ”Not having the information you need when you need
it leaves you wanting. Not knowing where to look for that information leaves you powerless. In a
society where information is king, none of us can afford that”. One place to find information on the
Epsom Property Market is here at the Epsom Property Blog, where you will find many articles just like this.
Or you can email Ian at <a href="mailto:ian@directresidential.co.uk">ian@directresidential.co.uk</a>Anonymoushttp://www.blogger.com/profile/12875699382108497020noreply@blogger.com5