Thursday, July 2, 2015

Bingham Buy To Let – Supply and Demand

Following on from my recent article about the state of the Bingham property market and in particular what had happened to the rents Bingham tenants have had to pay since the Credit Crunch, if you recall, I said rents in Bingham are still 4.86% lower than they were in 2008. 

A Bingham landlord has since rung me after reading the Bingham Property Blog, wanting to know more of the story of what was happening to current rents in the town. He was looking to increase the rent but keen to be fair to his tenants he needed to know hoe the current rental market was performing.

The Bingham rental market is all about supply and demand. On the supply side, 16 rental properties have come up for let in the last 31 days in Bingham. It sounds a lot until you consider there are 414 rental properties in Bingham, that means only 3.86% of the rental stock of properties in Bingham 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 they want. Older properties in Bingham, that haven’t been maintained, still retain their wood chip wallpaper from the 1970’s and thread bare carpets 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 Bingham have risen by 0.4% 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.   

Interestingly, looking at Bingham 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 Bingham, with 0.8% growth, meaning they are now 4.9% higher than they were a year ago.  When one looks at the regional picture, the East Midlands average property values rose by 1.4% 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 Bingham 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. 

Each rental property must be assessed on its own merits so I am visiting the property with the landlord to see how it compares to other rental properties. For more in depth thoughts and opinions like this on the Bingham Property market give me a call on 01949 714101 or pop into our office on the Market Place in Bingham.

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