A belated Happy New Year to all my Blog reading friends!! Trust the holiday season has treated you all well. Now that you are rested, relaxed and rejuvenated I’m sure you have gotten into the full swing of things with vigour and enthusiasm. We’re already passed the middle of January 2018 and finally I feel like the dust has settled allowing me the opportunity to catch my breath to reflect on the past year.
Wasn’t 2017 eventful?! Last year was the greenest year in the UK. We broke all previous records by June 2017 when our use of wind, nuclear and solar power created more UK power than gas and coal combined. From England women winning the World Cup in July to an incredible breakthrough by scientists at University College London who have developed a drug that they hope could stop Huntington’s disease. To top the end of the year there was the Royal love story with the announcement of romance, a wedding between Prince Harry and Megan Markle and something close to the hearts of every buy to let landlord and homeowner in Walsall… the changes in the local property market.
So, let’s look at the headlines for the Walsall property market in 2017…
In the last 3 months of the year, Walsall property values rose by 1.54%, leaving them, year on year 3.23% higher, whilst interestingly, Walsall asking prices are also up 3.19% month on month. All three statistics go to show the Walsall property market has recovered well after the summer lull (similar to the previous year – 2016). Irrespective of all the issues, the average value of a Walsall home now stands at £187,084. An increase of 6.24% when compared to the same time last year. I hear novice investors telling me all the time how small they think gross yields of 6-8% is well…the way I see it is…yields is your cashflow and capital growth is your take home pay at the end of the working month. That’s the way I see it and I know where I would rather have my money.
Generally, Walsall asking prices continue to hold up well, as asking prices are 2.72% higher year on year. Asking prices tend to drop on the run up to Christmas and locally, they have dropped by 0.4% this month. Although this still compares well with last year’s drop in Walsall asking prices, as we saw asking prices drop by 0.7% at the same time 12 months ago.
Looking at the figures for the UK – as we can’t just look at Walsall in isolation – property values are generally rising slower than a few years ago, but on a positive note, there’s still growth across the UK. Slowing property value growth isn’t solely around the uncertainty of ‘Brexit’ related negotiations, but after a number years of double digit rises in property values, affordability has weakened and cooling price growth is widely seen to be a natural correction of the market.
On the other hand, interest rate being at a record low of 0.50% is helping the property market including the increased limit for Stamp Duty to would-be first time purchasers. The increase in interest rates in the late Autumn has many rushing to secure their mortgage payments on a fixed rate which, I have written in a previous article, is the sensible thing to do as interest rates will only go one way…up!!
So, what will happen in 2018 in the Walsall property market?
Like I said last year, until we know what type of exit the UK will make from the EU it is hard to evaluate the outcome. If this is the case, we need to be very patient people! However, I believe, the whole Brexit issue is a sideshow to the main issue in the UK and Walsall housing market as a whole. As I have mentioned time and time again over the last few months, the biggest issue is demand outstripping supply when it comes to the number of households required to house us all. Walsall has an ever-growing population: with immigration (we still have at least a year of free movement from EU members into the UK), also people living longer.
We also need additional households as the country has nearly 115,000 divorces a year thus one household becoming two!! I’m looking forward to 2018…are you? Call or email me if you want my opinion on any of your property needs. No charge for opinions…I’ll tell you what you need to hear – not what you want.
Phone: 01922 311016