I had a lot of enquiries and conversations following my recent article about the state of the Walsall & Surrounding Area Property market and in particular what had happened to rents in the area since 2008. If you recall, I said that rents in Walsall are still 4.68% lower than they were in 2008. One particular Walsall landlord rang me after reading the Property Blog wanting to know more of the story of what was happening to rents in the Town. The reason he asked was that his current agent hadn’t increased his rent for a number of years and he was questioning whether he was getting the best return from his buy to let investment.
The Walsall rental market is all about supply and demand – isn’t it so in all parts of the economy? On the supply side, 565 rental properties have come up for let in the last 31 days in the Walsall & Surrounding Area. It sounds a lot doesn’t it that is, until you consider there are 15,943 rental properties in the area, that means only 3.54% of the rental stock of properties is coming onto the market and it is normally around 5%. One reason for this lack of new rental properties coming on the market is the fact that tenants seem to be staying in properties longer.
With this lack of supply, newer tenants have to pay more to secure the property they want. This is the crux of the matter.. properties they want. Older properties in the area, that haven’t been maintained, still retain their wood chip wallpaper from the 1970’s and thread bare carpets have seen their rents drop. Tenants want either modern properties with all the mod cons or older style properties that have been presented to an exceptional standard – and, generally, they are prepared to pay for the privilege. Rents for top quality properties in Walsall have risen by 0.4% in the last month. Any properties, old or modern, put on the market in good or excellent condition will rent in a matter of a few days.
Interestingly, looking at local property values, the Land Registry has just released it’s latest set of data. Throughout April 2015, the latest set of data, property values remained static in Walsall, with 0% growth, meaning they are now 3.3% higher than they were a year ago. When one looks at the regional picture, the East Midlands average property values rose by 1.4% in the last month. The difference doesn’t concern me, as the regional and local property values always even themselves out over the months.
Looking forward, after considering all the statistics and talking to other property professionals, I expect property values in our locality to rise by 3% to 5% over the coming 12 months, following the Election result. In a forthcoming article, I will discuss how the number of properties changing hands each month has dropped considerably in the last 10 to 15 years in the Town.
..and so back to my chat with the landlord.. Each property is unique and so, as his tenancy agreement allows him to inspect the property with notice to the tenant, we will be visiting the property next week!
Phone: 0345 357 9850