Buying a house for the same price as a TV!

An elderly gentleman popped into the office a couple of days ago to ask about, of all things, inheritance tax!  He had read an article in our recent newsletter and wanted some more information so I put him in touch with our tax specialist to arrange a chat.  We got talking about investing in the Walsall property market and he reminded me that in his day, you could have bought a property for the same price as a decent second hand car would sell for today and that his father was buying property for the same price as a decent 50 inch LCD TV!


Now of course, these are only headline prices and we have had wage growth and inflation.  Interestingly, since the Second World War, property values in Walsall doubled in 1961, 1971, 1975, 1980, 1988, 2000 and 2006.

Looking at more recent times, since the start of the Millennium, these increases in property values have generated large increases in equity for many homeowners but on the other side of the coin also making housing unaffordable for other people. It might interest readers to note that most of Europe experienced sharp increases in property values in the early years of 2000’s, with only Spain beating us – although we know what has happened to Spanish property market over the last few years!  In the 2000’s, the British situation was different in two regards.  First, the property value boom started earlier and saw more sustained increases.  Second, the regional pattern was fairly uniformed.

However, since 2010, the regional pattern has been completely different in the UK compared to 2007, the last property boom.  Average property values today in England and Wales are 1.2% higher, whilst in Greater London, they are 35.7% higher, whereas in Walsall they are 8.9% lower.  The London property market has been like a different country.  Looking specifically at Walsall though, it has continued for first time buyers to get on the housing ladder.  One of the best measures of the affordability of housing is the ratio of Walsall Property Prices to Walsall Average Wages – the higher the ratio, the less affordable properties are;

Starting with 1997, the ratio was 2.46 to 1 – the average value of a Walsall Property were 2.46 times higher than the average annual wage in Walsall.

2000      2.31 to 1              2002      2.94 to 1              2003      3.24 to 1

2007      5.56 to 1              2009      4.01 to 1              2012      3.75 to 1

Today   4.18 to 1

You can see quite clearly, even though we had an improvement just after the 2007 property crash when the ratio dropped, in following subsequent years with Walsall house price’s rising but wages not keeping up with them, the ratio started to rise.  This has meant there has been a deterioration in affordability of property in Walsall over the last couple of years.  This is one of the many reasons why the younger generation is deciding more and more to rent instead of to buy their own house.  The local council sold off Council Houses in the Thatcher years and for many on low incomes or with little capital, owning a home has simply never been an option.

With fewer people able to save up the deposit required by mortgage lenders, more and more people are looking to rent.  This delay in moving up the property ladder has driven rents up in Walsall over the last few years.  Also, there has been a change in attitudes towards renting over the last decade.  All these things have combined to make the demand for rental property in Walsall to increase.

If you are thinking of becoming a first time landlord or looking for advice and opinion on what to buy (or not as the case may be) in Walsall, one source of information is the Walsall Property Blog.

To discuss any property related matter please do not hesitate to get in touch with me either by phone or email:

Phone: 0345 257 9850


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