Hope for Better Rented Housing

Despite government changes and fresh challenges in the ‘buy-to-let’ market, the future for rented property will continue to be one of the best bets for the country’s growing number of tenants as well as landlords.

Although the market is likely to be slowed down by the threat of stricter ‘buy-to-let’ rules - including tougher affordability checks for buy to let mortgages and the withdrawal of tax relief on mortgage interest – we are still reporting an increase in demand for houses to rent.

If you are a cash investor, or perhaps an ‘accidental landlord’ who has inherited a property with no mortgage repayments, you can expect a very healthy return on your investment – far better than you could achieve from mainstream savings products.  

A priority in 2017 will be to carry on sourcing more local, good quality rental accommodation to satisfy both landlord and tenant client demand across the board.

Recent figures suggest an encouraging rise in the number of rental properties coming onto the UK market in nearly 60 per cent of UK towns and cities. And although rents are rising modestly they are, nevertheless, rising. 

A Labour-backed inquiry into the nation’s housing crisis revealed that almost two-thirds of UK tenants don’t expect to afford a mortgage in the next five years either.

Meanwhile, government house building targets have let them down again. A House of Lords committee called for 300,000 new homes to be built in England each year - but in 2015-16 just under 190,000 new properties were added to the housing stock.

The private rented sector plugs a serious gap and provides essential good quality, affordable housing for a modern generation of tenants while opening up new opportunities for people who can invest in ‘buy-to-let’ properties.

New property investors will need to have a very clear strategy, in terms of what they expect from rental returns and capital growth. Renting in 2017 is expected to be an increasingly real alternative to home ownership but landlords need to buy property at the right price and thoroughly research its marketability.

If you are considering investing, then Bingham may offer the type of returns you are looking for. In the long term it is prime placed for good levels of capital growth due to its close proximity to Nottingham and commuter routes and good schools.

For an honest opinion on rental values please do not hesitate to give me a call on 01949 714101 or pop into our office on the Market Place in Bingham. 

Lovely 3 bed Investment Potential £199,950 - Mallow Way, Bingham

Another great investment property on this popular development.  As mentioned in my post last week, if you have a little more money to invest, you could see higher capital growth.

This property is ready to let and would let very easily, leaving very little void period. Being marketed by Richard Watkinson & Partners, bingham, see full details here:  

http://www.rightmove.co.uk/property-for-sale/property-62961017.html

Capital Growth in Bingham

                                         

If you are thinking of investing in property you need to consider not only the monthly yield but also the growth on the capital invested.  I was really pleased to see high levels of capital growth seen in many Bingham properties.

I concentrated my research on my preferred type of investment – the ones that will let on the first viewing and appeal to the right type of tenant – modern 2 and 3 bedroom properties.

There are a lot of properties in Bingham that were built around 10 to 15 years ago.  Built with efficiency in mind and which should continue to offer a low maintenance option for the next 10 years.

I found modern 2 and 3 bed properties that had been bought in 2005 and sold again in 2016 had seen an average of 28.75% growth in the capital over this time. When you consider during this 10 year period we have also had a double dip recession I think that’s pretty good going.

The rental income on these has also increased over this time.  Back in 2005 we would be getting £650 PCM for these 2 beds and now we are getting nearer to £800 PCM.

In Bingham itself you do need to be looking at investing between £175,000 - £200,000 in a property to see these levels of returns.

Looking further afield to, say Calverton, you can achieve a good yield on an investment of around £125,000.

The difficulty for investors is getting hold of these types of properties. They don’t come on to the market very often and they sell quickly. 

Lovely Langar - Potential Investment Property for Sale

Langar is a sought after village within the Vale of Belvoir.  The village itself has many amenities including a primary school, post office and pub. With great transport links to Bingham, Nottingham, Grantham and Leicester, the village offers a rural base for any commuter.

The property is neutrally decorated, though there is no photo of the kitchen and so that would need investigating.  Assuming no major works are required, a landlord could see a rental yield of around 5%, which is a good return on any investment currently.

See the property details here, it is on the market for sale with Frank Innes Bingham:

http://www.rightmove.co.uk/property-for-sale/property-38467224.html

Uncertainty in the 2017 Bingham Property Market

I have been reading lots of articles in the media about uncertainty in 2017, if 2016 is anything to go by who knows what will happen!!

It got me thinking about the Bingham property market, employment levels and the availability of credit?

We have to realise that the chronic shortage of housing will keep prices buoyant even if lending does become more difficult.

We have seen lots of changes in Bingham since 1998.  If there has ever been a problem for people to borrow money or to secure a mortgage, it has always increased the numbers of people looking to rent a property.

The increased demand, and shortage of rental available, only results in rents increasing.   Perhaps it will become more viable for a landlord to invest if they can see the returns on a rental property grow.

The government do seem keen to keep increasing the taxation levels on landlords.   Without people investing in property there would be no Private Rented Sector to cater for those who choose to and need to rent.   It’s often their only option or the best option for their current circumstances.

I believe we will see those with some cash to invest still buying property, especially if the yields become more favourable, as the returns from savings are expected to remain low.  The increasing yields would offset the increasing taxation levels for landlords but it is not going to help the tenants of Bingham – many who are just about managing at the moment.

If you are already a landlord and concerned about the effect of a potential unsettled period there are things you can do to minimise your exposure to risk.   The main things are ensuring your property is well maintained and regularly inspected.   Make sure you have a comprehensive Buildings insurance with reasonable excesses – you don’t want any nasty surprises from an escape of water for example.

It seems very unlikely, but should employment levels in Bingham ever be affected, Landlords could consider taking out a Rent Guarantee.   If a tenant becomes unable to pay then the rental income will be protected and the costly eviction process will also be covered.   I do believe here in Bingham we are well placed geographically for people to be able to find work.

If you would like to discuss anything about the Bingham Property Market please call me on 01949 714101

Investment Property Over 6% Yield - Calverton

This property, situated on a great plot, could bring in a yield of over 6%, which is a fantastic return for any investor.  While it may need some cosmetic work to bring it up to the current rental market standard it looks as though the big jobs have already been done.

On the market with Martin & Co at an asking price of £110,000, it is the most reasonably priced 3 bedroom property on the market in the area so I don't imagine it will be around for long.

http://www.rightmove.co.uk/property-for-sale/property-63413282.html

      

2016 - The Bingham Rental Market

The rental market has been very different for us during 2016.   At any one time we would normally have around 25+ properties to let, but this year has seen the average be around 8 available at any given time.   This has resulted in great competition for rental properties amongst tenants and an increase in the rent the properties can achieve.

I did some investigations and of the current live tenancies on our system (let only and managed) 47% have been in their tenancy for over 2 years.   Our longest standing tenant will be celebrating her 16^th year in her property this month! 

The rental market has changed so much since she moved in.   It suits many investors that tenants are now staying longer but means that fewer properties are coming onto the market for re letting and thus reducing the numbers of property available.

December too has been a strange month - with double the number of notices coming in from tenants.  These re-let properties are letting quickly so our residual stock remains around the 15 mark.

What will happen in 2017?  I think rents will continue to increase as the availability of property remains low and the demand from tenants is still high.   Bingham will always be a popular place to live as there are plenty of employment opportunities in the area , along with good schools.   

If you are considering an investment during 2017, please feel free to give me a call or pop into my office in the Market Place, Bingham.