Only 1,056 Council Houses in the Bingham and Rushcliffe area left – opportunity or problem?

The ‘Right to Buy’ scheme was a policy introduced in 1980 which gave secure council tenants the legal right to buy the council home they were living in with huge discounts. The heyday of council ‘Right To Buys’ was in the 80’s and 90’s, when 1,719,368 homes in the country were sold in this manner between October 1980 and April 1998. However, in 1997, the discount available to tenants of council property was reduced and the numbers of properties being bought under the Right to Buy  scheme declined.

So what does this mean for Bingham homeowners and landlords? Well quite a lot in fact!

Looking at the figures for our local authority, whilst the number of ‘Right to Buys’ have dwindled over the last few years to an average of only 82 ‘Right to Buy’ sales per year, one must look further back in time. Looking at the overall figures, 2,257 council properties were bought by council tenants in the Rushcliffe Borough Council area between 1980 and 1998. Big numbers by any measure and even more important to the whole Bingham property market (i.e. every Bingham homeowner, Bingham landlord and even Bingham aspiring first time buyers) when you consider these 2,257 properties make up a colossal 6.4% of all the privately owned properties in our area (because in this local authority area, there are only 35,142 privately owned properties).

Bingham first time buyers and landlords can now buy these ex-council properties second hand as those original 80’s and 90’s tenants (now homeowners) have passed the time of any claw back of the discount they received.

Now let us all be honest, some (not all), but some ex-council properties lack the vital kerb appeal that some landlords crave. The new home builders know all about kerb appeal as they dress up the exteriors of their new homes to make them more appealing to buyers.

Yes, the modern stuff being built in Bingham is lovely, but too many landlords purchase buy to let property solely based on where they would choose to live themselves, instead of choosing with a business head and choosing where a tenant would want to live ... because remember the first rule of buy to let property … you aren’t going to live the property yourself. What an ex-council property lack in terms of kerb appeal, it will more than make up for in other ways.  Tenants tend to be more interested in how close the property is to a particular school or family members for childcare, for example, than the look of a property.

Whilst ex-council properties tend to increase in value at a slower rate than more modern properties, that is more than made up for in the much higher yields – and those built between the wars or just after are really well built. Tenant demand for such properties is good since Bingham property values are so expensive, a lot of people can’t get mortgages to buy, so they will reconcile themselves to renting, meaning there is a good demand for that sort of property to rent. Also, the very fact the council were forced to sell these Bingham properties in the 80’s and 90’s, means that today’s younger generation who would have normally got a council house to live in themselves, now can’t, as many were sold ten or twenty years ago.

So to Bingham landlords I say this … don’t dismiss ex-council houses and apartments – but remember the 1^st rule of buy to let (see above).  Bingham landlords should go in with their eyes open and take lots of advice. Not all ex-council properties are the same and even though they have good demand and high yields, they can also give you other headaches and issues when it comes to the running of the rental property. 

That just leaves the 1,056 council houses still owned by the local authority to be sold to their tenants in the coming years!

2 bed investment property on Cropton Grove in Bingham

This 2 bedroom property looks to be in excellent condition inside and is on the market with Rex Gooding for £150,000, with the potential to see a 5% return. 

This looks like the sort of property that will require very little work to get it ready to let. 

http://www.rightmove.co.uk/property-for-sale/property-58451579.html

Private Renting in Bingham increases by 51.57% in 20 years

You find me in a reflective mood today as I want to talk about the future of investing in property in Bingham. Many people have mistaken the ever rising Bingham (and in fact the whole of the UK) property market since the 1960’s as the eternal gift that kept giving as property prices constantly rose and doubled every five to seven years.

Whilst George Osborne has decided now is the time for changes in taxation of buy to let property, many pundits are predicting the end of buy to let as we know it. However, it is still possible to make a reasonable, profitable and safe return on property with these changes. You need to study the market, take advice and opinions from many people and then decide what the future demand will be.  Remember, tenants will always want a roof over their head and I don’t see the HM Government building the millions of houses required to house them?

No one could have predicted how the property market has changed in Bingham over the last couple of decades. Looking specifically at the Newark Parliamentary Constituency, twenty years ago, 24,502 households (meaning 67.05% of property) was owned and only 3,138 households were privately rented (meaning 8.59% of property was rented out by private landlords). Roll the clocks on twenty years and the change shows that now 30,268 of properties in the Constituency are home-owners (a drop to only 54.30% being owner occupied) with the jump in private renting increasing as 5,430 properties are now privately rented; proportionally 13.09%. (NB neighbouring constituencies show similar changes as well).

Who would have predicted in 1995 the private rental sector in

Bingham would have grown by 51.57% in the proceeding 20 years?

Also, if you had asked someone in 1995 to predict what would happen to property values over the proceeding 20 years (ie between 1995 and 2015), they might have predicted similar growth to the growth experienced over the previous 20 years (ie between 1975 and 1995), which was a very impressive 351.55%. Yes, property values in Bingham have increased over the last 20 years (between 1995 and 2015), but by a more modest 126.63% (and most of that can be attributed to house price growth between 2000 and 2006.)

The property market is constantly changing and buy to let for too long has been heavily dependent solely on house price growth, where yield has been almost forgotten.  I see the changes in tax and landlord and tenant law in a different perspective to the doom-mongers and see it as bringing many opportunities. You might need to change your buy to let benchmarks and / or your approach to financing, but this will shine a light on investing in properties with healthier yields and create more realistic long term buy to let opportunities, instead of short term growth bets and wagers.

The advice I give to my landlords is this: these changes will make some landlords panic, meaning competition for decent Bingham buy to let bargains will reduce as fear of change kicks in and amateur investors flee the market. These opportunities will provide a more stable platform for knowledgeable and wise Bingham buy to let landlords to thrive in. If you want to learn more about the Bingham Property Market, feel free to pop in to our office for a chat with me.  Keep your eye on this blog too, which is solely based on the property market in Bingham and potential buy to let investments with honest return figures.

Tried and Tested Buy To Let For Sale in Bingham

This property is being marketed to investors only, by Hammond Property Services.  It is currently achieving a monthly rental of £595.00 and so is a fairly low risk investment for any landlord.

See full details here:

http://www.rightmove.co.uk/property-for-sale/property-40530411.html

      

Investment Property for Sale in Calverton - Good Yield

This family home is situated in the popular village of Calverton.  A large village with plenty of amenities and good schools, Calverton offers good access to Nottingham city and also the Nottinghamshire countryside.

The property would make a good investment due to its relatively low asking price, and hence high rental yield of around 6%.  There may be some minor maintenance works to be done, and so would need to be viewed to make an assessment.

It is on the market with Gascoines of Calverton, with a current asking price of £129,950.

http://www.rightmove.co.uk/property-for-sale/property-38209932.html

£170,000 inheritance - Is buying Bingham Property still the best place for my windfall?

I had an interesting email from someone in Bingham a few weeks ago that I want to share with you (don’t worry I asked his permission to share this with you all). In a nutshell, the gentleman lives in Newton, he is in his mid 60’s and still working. He has a decent pension, so that when he does retire in a couple of years time, it will give him a comfortable life. He had recently inherited £170,000 from an elderly aunt. 

One option he told me was put it into a savings account. The best he could find was a 2 year bond with the Post Office which paid 1.9%; meaning he would get £3,230 in interest a year. One of his other options was to buy a property in Bingham to rent out and he wanted to know my thoughts on what he should buy, but he had concerns as he didn’t want to take a mortgage out at his time of life. He was also worried about all the tax changes for landlords he had read about in the news.

Notwithstanding the war on Bingham landlords being waged by George Osborne, the attraction of bricks and mortar endures for many. As my contact is a cash buyer, he would not have to deal with the intricate cut to mortgage interest tax relief that will diminish, or even eradicate, the profits of many Bingham landlords. It’s true he would face the extra 3% in stamp duty to buy a second property, but with some good negotiation techniques, that could soon be mitigated.

I told him that buying a Bingham buy to let property is all about the total return on investment. True, he could put the money in the Post Office bond and receive his interest of £3,230 a year or, as he rightly suggested, invest in property in Bingham. The average yield (yield being the equivalent of the interest rate on the property) at the moment in Bingham is 4.11% per annum, meaning our potential F.T.L (First Time Landlord) should be able to, depending on what he bought in the town, earn, before costs, £6,987 a year.

The bottom line is that the success of investing in Bingham buy to let property versus a savings account with the Post Office (or whatever Bank or Building Society is offering the best rate) will depend on the performance of those assets. Unlike with a savings account, with property the capital you invested can also go up (and yes, it can go down as well – more of that in second). Property values in Bingham have risen in the last twelve months by 4.7% meaning, that if our chap had bought a year ago, not only would he have received the £6,987 in rent, but also seen an uplift of £7,990 …meaning his overall return for the year would have been £14,977 (not bad when compared to the Post Office!).

..  but the doom mongers amongst you will say, property values can go down, as they did in 2008, and in 1988 and 1979. Yes, but after 1979 prices had bounced back to their ’79 levels by 1984 and went on to grow an additional 58% in the following four years. Then again, they dropped in 1988 and did take 13 years to reach back to those ’88 figures, but the following six years (between 2001 and 2007) they then increased by an additional 66%. Now, according to the Land Registry, average property values in Nottinghamshire currently stand 5.8% below the January 2008 level, and anecdotal evidence suggests that in the nicer parts of Bingham, we are well above these sorts of levels. Therefore, all this talk of property crashes is unfounded.

… and what would that £170,000 get you in Bingham? A brand new 2 bed semi on Bowland Road or a 3 bed terrace on The Paddock .. 

Modern Apartment in Eden Walk, Bingham - Perfect Investor Property

These apartments are so easy to let and with very little in the way of maintenance, they make a fantastic choice for buy to let investors.

On the market for £ 129,950, it is situated in a lovely residential development, with easy access to the A52 and A46 for Nottingham, Grantham, Leicester and Newark.

It should see a healthy return of over 5%.

See full details here:

http://www.rightmove.co.uk/property-for-sale/property-40376805.html