Bingham house prices since the Millennium have risen by 120.52%, whilst
average salaries in Bingham have only grown by 51.27% over the same time frame.
This has served to push homeownership further out of reach for many Bingham people as they have to battle against raising considerable deposits and meet sterner lending criteria, as a result of new
mortgage regulations introduced in 2014/5.
The private rental market in Bingham has grown throughout the last twenty
years with buy-to-let investors purchasing a high proportion of newly built
residential properties that were built and designed for the owner occupier
sales markets. For example, in the Newark Constituency, roll
the clock back 20 years and there were 36,541 properties in the Constituency,
whilst the most recent set of figures show there are 41,691 properties - a
growth of 5,150 properties.
Nevertheless, some say this historic growth of the Bingham rental market
might start to change with the new tax rules for landlords introduced by Mr.
Osborne over the last seven or eight months. Yet the numbers tell another
story. Across the board, mortgage borrowing climbed to a 9 year high in March this year as the
British property markets traditional Easter rush corresponded with landlords
hurrying to beat George Osborne’s new stamp duty changes – buy-to-let landlords
borrowed £7.1bn in March 2016 (the latest set of figures released) which was
163% up on the £2.7bn borrowed in the previous March.
You see,
from my point of view, I don’t think things will get worse in the buy-to-let market
in Bingham and these are the reasons why I believe that:
Firstly, what
else are Bingham landlords going to invest in if it isn’t property - the stock
market? Since the Millennium, the stock
market has risen by an unimpressive total of 5.54%, quite different to the 120.52
% rise in Bingham property prices?
Secondly, its true the 3% stamp duty is the
first blow on top of a number of other tax changes to be phased in between 2017
and 2021, such as landlords facing a constraint in their ability to offset
mortgage interest and, if sizeable numbers of landlords do
take the decision to sell their portfolios, this will lead to a substantial
amount of second hand properties being put up for sale. Yet that might not be a
bad thing, as I have mentioned in previous articles there is a serious shortage
of properties to buy at the moment in Bingham: the stock of property for sale
being at a six year all time low.
.. Thirdly, if there are fewer rental
properties in Bingham, as supply drops and demand remains the same (although
ask any letting agent in Bingham and they will say demand is constantly rising)
this will create a squeeze in the Bingham rental market and as a result rents
will rise. In fact, I predict even if landlords don’t sell up, Bingham rents
will rise as Bingham landlords seek to compensate for increased costs, which
means more landlords will be attracted back.
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