Thursday, November 26, 2015

Bingham Buy To let –Freehold House or Leasehold Flat?

I wish to answer a question emailed into me from a potential Bingham landlord last week. Nice chap, lives in The Banks area, and it turns out, after having a coffee with him, has a spare bit of cash (now the kids have flown the nest) and wanted to buy his first buy to let property.

His main question was ... Do I buy a freehold house or a leasehold flat in Bingham?

Most people will say freehold every time, because you own the land. However, it’s not as simple as that. The definitive answer though is to research what it is that Bingham tenants want, within the area that they want. The tenant is ultimately your customer, and, if they don't want to rent what you decide is best to buy, then you are not going to have a successful BTL investment. So starting with the tenant in mind and working backwards from there, you won’t go far wrong. Find the demand before you think about creating the supply.

Leasehold flats and apartments in Bingham are excellent in some respects as they offer the landlord certain advantages, including the fact a flat can be initially cheaper to buy. Yields can be quite good, offering better cash flow. The building will already be insured and yes there is a service charge, but it’s still for a service at the end of the day and that cost is spread between many others (i.e. when your freehold house roof goes, its falls 100% on your shoulders) and one of my favourites is that there is often no garden to maintain or blown down fences to replace!

However, some Bingham leasehold flats can suffer from poor capital growth. Some leasehold properties have no cap on the level of the service charge and it may get out of control. The length of the lease will significantly affect value if not renewed before it gets too short. Thankfully there are not many, but some Bingham apartments/flats have burdensome clauses. Finally, with leases, there can be sub-letting issues – which means you can’t let them out.

So what do the numbers look like? Well since 2003, the average freehold property in Bingham (detached, semis and terraced) has risen from £115,468 to £236,654, a rise of 105% whilst the average Bingham leasehold property (flats and apartments) has dropped in value from £130,363 to £117,000, a decrease of 10%.
I was really interested to note that of the 5,595 rental properties in the Rushcliffe Borough Council area that the Office of National Statistics believe are either let privately or through a letting agency, 2,060 of them (or 36.8%) are apartments. However, there are only 4,972 apartments in the whole council area (be they owned, council rented or privately rented), which represents 10.8% of the whole housing stock in the area. This really intrigued me that, quite obviously, there is a high proportion of Bingham’s leasehold apartments/flats rented to tenants compared to detached, semi’s or terraced. 

Every Bingham apartment block, every terraced house or semi is different. Like I said at the start, the definitive answer though is to research what Bingham tenants want in the area of Bingham they want. Demand for town centre apartments, near transport links can be popular and can offer the Bingham landlord very good yields with minimal voids. However, Bingham terraced houses and semis, whilst not always offering the best yields (although sometimes they can), they do offer the Bingham landlord decent capital growth. 

My advice to the prospective landlord as it is to you is do your homework. Another source of info many Bingham landlords use is me! What many Bingham landlords do, irrespective of whether you are a landlord of ours, a landlord with another agent or a DIY landlord, if you see any property in Bingham, that catches your eye as a potential buy to let property, be it a terraced house, semi or flat... email me and I will email you back with my thoughts (although I will tell you what you need to hear .. not want to hear!)

Thursday, November 19, 2015

How EU Migration has changed the Bingham Property Market

The 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 Bingham Property market.

Before we look at Bingham 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.

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!

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).

Interestingly, in Rushcliffe, migration has fallen over the last few years. For example, in 2006 there were 324 migrant National Insurance Cards (NIC) issued and the year after, in 2007, 377 NIC cards were issued. However, in 2014, this had slipped to only 279 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.

In essence, migration has affected the Bingham property market; it couldn’t fail to because of the additional 2,771 working age migrants that have moved into the Bingham area since 2005. However, it has not been the main influence on the market. Property values in Bingham today are 1.12% lower than they were in 2005. According to the Office of National Statistics, rents for tenants in the East Midlands have only grown on average by 0.66% 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 Bingham 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.

If you are considering investing in a buy to let property please feel free to pop into our office on The Market Place in Bingham or give me a call for unbiased opinion on the potential returns for that property.

Thursday, November 12, 2015

A great investment opportunity in Newton!

This extended 3 bed semi would let really well and give a potential return of 5.2%. 
It is on the market via Purple Bricks for a shade under £150,000.

Newton is great for professional tenants as it provides easy access to Nottingham and the A46 to Leicester and Lincoln. 

This would let easily for £650 pcm and is a great prospect for capital growth due to the plot size and location. If you would like to discuss the potential of Newton as an area to invest in please do not hesitate to give me a call. 

Further details can be found at

Bingham Property Market Crisis as New House Building slumps by 37.46%


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.

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 Bingham 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 Kenneth Clarke, 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.

To give you an idea of the sorts of numbers we are talking about, in the Nottinghamshire County Council area, 2,480 properties were built in 2005. In 2006 that rose to 2,650 and a year later in 2007, it peaked at 3,070. By 2014, that figure had dropped by a massive 37.46% to 1,920 properties built.

The outcome of too few homes being built in Bingham 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.

I talk to many Bingham 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 Bingham 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 Bingham landlords, who own the 414 rental properties in the town. 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 Bingham!

Moving forward, those Bingham landlords have many pitfalls, both in the short term and medium term. For instance, were you aware that the rules of changes for new tenancies from the 1st October 2015 (with some imposing penalties including losing 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 lets are taxed?

More than ever, the days of buying any old property in Bingham 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.

If you are considering investing in property please give me a call or pop into our office for an honest appraisal of any buy to let potential investment.

Wednesday, November 11, 2015

Brand new property investment opportunity in Calverton - 5.5% yield

I have mentioned this new housing development in the ever popular Calverton before, it really is a lovely place to invest.  With good schools, transport links and a village atmosphere, Calverton attracts many different types of tenants.  

Being a new build, this property is ready to let.  An easy investment for a new landlord, or a reliable property to build up a portfolio.

It is on the market direct from the builder, Taylor Wimpey, for £184,995, but as with all new builds, they are bound to accept offers from investors with no chain.

Thursday, November 5, 2015

Bingham House owners desert the housing market with an 8 year low

Even 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 Bingham as the number of houses available to buy is at an 8 year all time low.

Back in Spring 2008, there were over 200 properties for sale in Bingham and since then this has steadily declined year on year, so now there are only 46 for sale in the town.  This continuing diminishing supply of housing has been happening over those years for a while and there simply aren’t enough properties in Bingham to match demand.

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 Bingham 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.  

Talking to fellow agents, mortgage arrangers, surveyors and solicitors in the Town, all of whom have extensive dealings in the Bingham property market like myself, most of us agree the movement in the Bingham 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.
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.
When we look at the individual areas of the town, it paints an interesting picture.
  • NG13 – Bingham, Whatton, Bottesford, Aslockton Langer, Plungar and Barkestone, East Bridgford, and Orston  17 properties sold in May 2015 (the most recent set of figures from the HM Land Registry), whilst over the Spring months of 2014, the number of properties selling in this postcode was always between 50 and 60 per month. (Interestingly the average value of those properties was £264,702). 
So what does this all mean for homeowners and landlords alike in Bingham?  Demand for Bingham 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.

You see I believe a more stable, consistent Bingham 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 Bingham, 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 Bingham property market needs in the long term.

If you are a landlord or considering investing in property please give me a call to discuss the performance of buy to let investments or pop into our office in The Market Place in Bingham.

Wednesday, November 4, 2015

Great buy to let available for sale - Wharf Gardens Bingham - 5% yield

This apartment, on the market with Newton Fallowell, would let very easily and will give its owner a return of around 5%.  Situated on a very popular development, it is decorated to a high standard and offers flexible living, in a location with excellent transport links.  As the property has no upward chain, it should be a fairly smooth purchase.

Built only a couple of years ago, the owner will still benefit from its NHBC warranty, plus a low maintenance investment.

We recently let a property around the corner from this within 24 hours, highlighting just how much tenants love the area!