Thursday, December 31, 2015

Bingham House Price Monopoly: How do Prices vary?

Whether you are a homeowner or landlord in Bingham, what would a Monopoly board look like today in the town? Property prices over the last 80 years have certainly increased beyond all recognition, so looking at the original board, I have substituted some of the original streets with the most expensive and least expensive locations in Bingham today.

Initially, I have focused on the NG13 postcode within Bingham only, looking at the Brown Squares on the board, the ‘new’ Old Kent Road in Bingham today would be Langdale Grove, with an average value £109,120 (per property) and Whitechapel Road would be Carnarvon Place, which would be worth £110,060. 

What about the posh dark blue squares of Park Lane and Mayfair? Again, looking at NG13, Park Lane would be Belvoir Vale Grove at £430,000 and Mayfair would be The Banks at £495,800. However, look a little further afield from the town but still within the NG13 postcode, and such roads as Aslockton Road in Scarrington would claim the Mayfair card at £627,300! 

Also, I can’t forget the train stations (my favourite squares), and over the last 12 months, the average price that property within a quarter mile of the station sold for was £221,900.
So that got me thinking what you would have had to have paid for a property in Bingham back in 1935, when the game originally came out?

  •          The average Bingham detached house today is worth £271,680 would have set you back 491 Pounds 11 shillings.
  •          The average Bingham semi detached house today is worth £183,260 would have set you back 331 Pounds 11 shillings and 5 old pence.
  •          The average Bingham terraced / town house today is worth £162,800 would have set you back 294 Pounds 11 shillings and 1 old pence.
  •          The average Bingham apartment today is worth £116,450 would have set you back 210 Pounds 13 shillings and 10 old pence.

Anyway, I hope you enjoyed this bit of fun, but underlying all this is one important fact. Property investing is a long game, which has seen impressive rises over the last 80 years. 

In my previous articles I have talked about what is happening on a month by month or year by year basis and if you are going to invest in the Bingham property market, you should consider the Bingham property you buy a medium to long term investment, because buy to let is pretty much what it sounds like – you buy a property in order to rent it out to tenants.

As I reminded a soon to be first time landlord from Car Colston the other week, buy to let in Bingham (as in other parts of the Country) is very different from owning your own home. When you become a Bingham landlord, you are in essence running a small business – one with important legal responsibilities. 

On that note, I want to remind landlords of the recent and future changes in legislation when it comes to buy to let. This year, rules have changed about tenant deposits, smoke and carbon monoxide detectors and early in the New Year, landlords will have responsibilities to do immigration checks on all their tenants. Failure to adhere to them will mean a minimum of heavy fines in the thousands or in some cases, prison ... it’s a mine field!  

That’s why I write the Bingham Property Blog, where it has an extensive library of articles like this one, where I talk about what is happening in the Bingham property market, what to buy (and sometimes not) in Bingham and everything else that is important to know as a Bingham landlord. Please visit the Bingham Property Blog or give me a call on 01949 714101.

Tuesday, December 29, 2015

Tidy Whatton 2 bed could give you a 5% return on your investment

This 2 bedroom semi detached property is very well appointed.  With 2 double bedrooms and a lovely garden, it would appeal to many different types of tenants.  Great location close to the A46 and A52, offering good links to Nottingham, Leicester, Newark and Grantham.

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Thursday, December 24, 2015

Bargain Buy To Let in Calverton

This property is situated in a village location popular with tenants.  It looks to be in good order and is being marketed by Gascoines in Calverton for £ 109,950.  It should see a return of over 5% so is a great investment for any landlord, and a good choice for a first time investor.

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Image 2 of 12: Kitchen aspect two

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Wednesday, December 23, 2015

The Bingham Property Market and £1,300,000,000,000,000,000 in loose change

The 5th of March 2009 was the date Mervyn King, the then Bank of England Governor, slashed UK interest rates to the unparalleled figure of 0.5%. 

In just under five months, starting on 8th October 2008, the rate had come down from 4.5% to that low figure, all in an attempt to ensure the British economy survived the worldwide credit crunch. Now as we deck the halls with boughs of holly nobody expected that, over six years later, rates would still be at that low level.

In the summer, people were predicting a rise in the New Year, yet now, some forecast it may remain the same for years to come the due to the issues in China.

If you added up everyone’s bank and building society savings in the UK, they would add up to £1,300,000,000,000,000,000 (that’s £1.3 trillion), most of which is earning a pittance in interest.  That is why more and more 40 and 50 year old Bingham landlords have been investing some of that cash into Bingham bricks and mortar, as they search for a low risk investment opportunity.

Buying a Bingham buy to let property isn’t risk free, but there are certainly things you can do to mitigate and lower one’s exposure to risk. You see by buying a rental property, it potentially offers a decent proposition in terms of being able to obtain attractive returns that beat inflation and savings accounts, yet without taking the levels of risk associated with stock markets.

The UK residential property market has long been the safest form of collateral for lenders of all varieties. Against a backdrop of a greatly changing economic environment, Bingham house prices have been extraordinarily robust, increasing by over 1715.3% between 1974 and today. Some will say there have been significant property price falls, namely in 1975, 1988 and 2008, yet each time after this has been followed by an upturn in property values. 

For the record, the stock markets in the same time frame only rose by 432.5%!

.. and that is the best thing about buy to let property. Unlike the stock market, with its unfathomable equities, shares and bonds, that nobody really understands (as they are controlled by some faceless whizzkid in Canary Wharf!) with a buy to let property, landlords can take control and understand their investment .. in fact you can touch and feel the bricks and mortar investment.

..  but before you go out and buy any old Bingham property, plenty of landlords still get it wrong. You have to be aware of your legal responsibilities when it comes to tenant safety, tenants deposits, energy certificates and in the new year, landlords will have the added responsibility of checking the immigration status of prospective tenants. Get it wrong and big fines and even prison is an option – but that’s why many agents use a letting agent to manage their property for them.

Next, you have to buy the right property at the right price. Recently I have seen some really heart breaking situations in Bingham and the immediate area, of people paying way too much for a property, only to lose out when they came to sell. 

One example that comes to mind is that of a property owner in a fairly new detached house on Medway Drive in Bingham .. a very well presented, three bed detached house, recently fully renovated, 86 sq metres inside (925 sq ft in old money) sold in December 2007 for £221,950. In the summer, it only obtained £211,000, a drop of 5% or 0.7% a year - a very disappointing result.

I cannot stress enough the importance of doing your homework. One source of information and advice is the Bingham Property Blog or please give me a call on 01949 714101 for an honest opinion on the Bingham property market.

Monday, December 21, 2015

Newton 3 bed for under £150,000 gives 5.4% return

For sale with Newton Fallowell this 3 bed in Newton looks to be in good order inside. This area is growing in popularity for those looking for close proximity to Nottingham combined with access to good schools in Bingham and Newton. 

Its an area that I believe will see good capital growth over the next 10 years as the area develops. 

If purchased at the asking price of £149,000 would easily achieve a return of  5.4%

Thursday, December 17, 2015

Bingham Property Market 2015

Many landlords have been asking me my thoughts on the Bingham property market recently, and in particular, what is happening to property values. 

My calculations show property values in Bingham quite interestingly grew in the month of September by 0.2%.  When one looks at the annual growth, Bingham values are 4.3% higher (when comparing Sept 14 to Sept 15), impressive when you consider the annual growth of property values was only 3.7% per annum in June.  

On the other hand, there are signs that the fundamental growth of property values in Bingham has now peaked, despite those average property values being below levels recorded in 2007 (just before the 2008 crash).

Whilst the Bingham headline rate appears to be better, i.e. the year on year (Sept 14 to Sept 15) growth rate of 4.3% is obviously better than the 3.7 in June 14 to June 15), this impressive rise of Bingham property values masks the underlying truth in what is really happening to local property values in the town.  Throughout 2015, property values have been yo-yo like on a month by month basis, being quite volatile in nature.  For example,
  •          September 2015               0.2% rise
  •          August 2015                     0.4% rise
  •          July 2015                         0.8% rise
  •          June 2015                        0.4% drop
  •          May 2015                         0.1% rise
  •          April 2015                        0.4% rise
  •          March 2015                      0.6% rise

This is in part due to seasonal factors, as well as mortgage approvals increasing over June and July and then falling by over 15% in August, according to the Council of Mortgage Lenders (CML).

The outlook for the Bingham property market remains positive against the foundations of low mortgage rates and growing consumer confidence. 

Talking to fellow property professionals in the town, demand for property has been showing signs of moderating in the final few months of 2015, which in turn will lead to a slight slowdown in the pace of house price growth in the run up to the festive season. You see, it is really important not to read too much into one month’s (September’s) headline figures.

Readers might be interested to note that before the 2008 property crash, all the UK region’s housing markets tended to move up and down in tandem like the Bingham Synchronised Swimming team at the Bingham Leisure Centre Swimming Pool!  Since then though, the Greater London property market took off like a rocket in 2009/10, whilst the rest of the UK only really started to grow in 2012/13, and even then that growth was a lot more modest than the Capital’s.  

I cannot stress enough the importance of doing your homework.  If you are considering investing in property please give me a call or pop into our office on the Market Place for honest, unbiased advice.

Wednesday, December 16, 2015

Could you grab a BTL deal this Christmas?

Having had a look at properties available for sale in Bingham, I noticed that the properties below are still on the market.  I have added them to my blog in the past and am shocked to see that they are still available.  Since they have been on the market for a while now, it may be the perfect time to put in a cheeky offer.

James Drive, Calverton:  

Nearly new properties are always popular with tenants, and still benefit from their NHBC guarantee:

Trenchard Close, Newton: 
5.7% return on your investment, good transport links suiting professionals:

Picture 1  Picture 2  Picture 6  Picture 10

Rockingham Grove, Bingham:
Property is in good order, popular area with tenants.  Will let easily:

Picture 1  Picture 4  Picture 6  Picture 9

Thursday, December 10, 2015

Values of Bingham Terraced Houses smash through the £190/sqft barrier

The Council of Mortgage Lenders (CML) latest snapshot of the buy to let mortgage market shows us that buy to let landlords haven’t been put off by the Chancellors announcements on the way buy to let’s are taxed.

Last month, the CML stated £1.4billion was borrowed by UK landlords to purchase 10,500 buy to let properties, up 26.5% from the same month in 2014, when only 8,300 properties were bought with a buy to let mortgage. Go back two years and the number of buy to let mortgages used for purchasing (again not re-mortgaging) is 36.4% higher! Even more interesting has been the fact that the average amount borrowed has risen as well. The average buy to let mortgage last month was £133,330, up from £128,480 a year ago.

In Bingham, I am speaking to more and more landlords, be they seasoned professional landlords or FTL’s (first time landlords), as they read reports that the Bingham rental market is doing reasonably well, with rents and property values rising.  Interestingly, one landlord recently asked how much he should be paying per square foot (more of that in a second).

The first thing you have to decide is whether you want great capital growth or great rental yield, as every knowledgeable landlord knows, you can’t have both. Over the last twenty years, property values in Bingham have risen by 125.06%, compared to Greater London’s 436.2%. 

This has proved that capital growth increases faster in the more expensive South, but your investment money doesn’t go very far, meaning there won’t be as much rental yield from a 1 bed flat in Chelsea (2% per year at best with a fair wind) as a 2 bed semi in Bingham. However, whilst the figure of 125.06% is an average for the area, certain areas of Bingham have seen capital growth much higher than that and others areas much worse (we have talked about those in previous articles).

If you recall in an earlier article, my research reveals that Bingham apartments tend to generate a better yield than houses, probably because several sharers can afford to pay more than a single family. But houses tend to appreciate in value more rapidly and may well be easier to sell, simply because there are fewer being built.

So what should you be buying in Bingham, and more importantly, how much?
  • The average apartments in the town are currently selling for approximately £192 per square foot.
  • Terraced houses in Bingham are currently obtaining, on average, £164,300 or £190 per square foot,
  • An average semi in Bingham is selling for £183,100 (and achieving £188 per square foot). 

Now these are of course averages, but it gives you a good place to start from. In the coming weeks, I will look at rents being achieved on Bingham houses and apartments, and the yields that can be obtained, depending how many bedrooms there are. In the meantime, if you would like an unbiased opinion on what to buy and where please give me a call on 01949 714101.

Thursday, December 3, 2015

Has Osborne killed the buy to let market in Bingham?

Well George Osborne, in his Autumn statement last week, caused Bingham landlords to ask whether buy to let is a viable investment option, when he announced that landlords, when buying another buy to let property from April 2016 will have to pay an additional 3% stamp duty on top of the standard rate.  

So if an investor wanted to buy a property in Bingham for £123,000, before they would not have had to pay a penny in stamp duty, but from April next year it will be  £3,690. Move up market and it means that the stamp duty bill for a £285,000 buy to let home will rise from the current £4,250 to £12,800 from April next year. 

Some say property in Bingham will be worth less because potential landlords will not be willing to pay as much for them, and if house builders or existing homeowners don't feel they are going to get as much for them , then there is less motivation to build / sell them?... and the person we can blame for this is George himself. 

Back in 2012, he choose to utilise the British housing market to kick start the UK economy, with  subsidies, Funding for Lending and Help to Buy. However, whilst that helped the Tory’s get back into power in 2015, some say this impressive growth in the UK property market has been at the expense of pricing out youngsters wanting to buy their first home.

Over the next four years Landlords will slowly lose the ability to offset all their mortgage interest against tax on rental income, after changes announced in the Summer Budget. At the moment, landlords can claim tax relief on buy to let mortgage monthly interest repayments at the top level of tax they pay (ie 40% or 45%). However, over the next four years this will be reduced slowly to the basic rate of tax – currently 20%.
Surely this is the end of Buy to Let in Bingham? Probably.. but before we all run to hills panicking .. let me give you another thought.

Stamp Duty rules were changed in December 2014. Before then, landlords were eagerly buying up properties under the ‘old slab style Stamp Duty’ system. For example, the stamp duty bill on that £285,000 property was lower on the old slab style duty (pre Dec 2014), at £8,550, yet it isn’t a million miles away from new £12,800 stamp duty bill. 

Interestingly though, George has left a legal loophole in the new rules, because when it comes to selling up, they can offset purchase costs against any eventual capital gains tax, including stamp duty.I believe that total returns from buy to let will continue to outpace other investments, such as the stock market, gilts, bonds and even pensions. Also, the best part about investing in property is that it is bricks and mortar. You can touch it, you can feel it, and it isn’t controlled by some City whiz kid in Canary Wharf .. the British understand property and that goes a long way!

Buy to let has enough impetus behind it that prospective landlords will continue to buy even with a larger stamp duty bill. Bingham landlords will need to be savvy with what property they buy to ensure the extra stamp duty costs are mitigated.   

Buying buy to let property is a long term venture. In the past, it didn’t matter what property you bought in Bingham or at what price – you would always make money. Now with these extra taxes, the adage of ‘any old Bingham house will make money’ has gone out the window.   You wouldn’t dream of investing in the stock market without at least looking in the newspapers or taking advice and opinion from others, so why wouldn't you take the same advice and opinion about buying a buy to let property in Bingham?

Please pop into see me or give me a call for honest impartial advice on property investment 01949 714101

Wednesday, December 2, 2015

New investment opportunity - Calverton

This is a great family home with a lovely garden and outlook.  It has 3 bedrooms so would appeal to many different tenants.  The location is always popular due to good transport connections and yet a short drive or walk into the countryside.

The property may need a lick of paint here and there but generally looks good.

I would hope to achieve a rental of £750 pcm, giving the investor a return of over 5%.

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Image 5 of 12: Kitchen

Image 3 of 12: Lounge