Just before lockdown there were around 400 ‘5% deposit mortgage’ deals and first-time buyers were able to shop around to get the best deal. When the first lockdown hit, 5% deposit mortgages disappeared, meaning that as many Walsall would-be first-time buyers were about to buy their first Walsall home in 2020, the rug was pulled from under their feet.
Today, you can count on two hands the number of mortgage deals which allow a 5% deposit. Even worse, the number of hoops one has to jump through to get a 5% deposit mortgage is very high. On top of that, you have to pay handsomely for the privilege, with mortgage rates of at least 3.95%.
The property sector as a whole has been one of the highlights of the COVID-19 story so far. After a shutdown of the industry in the first lockdown, the Government gave the go ahead for estate agents and lettings agents in Walsall to continue to work, meaning that people could still move.
The slight easing of restrictions coupled with the Stamp Duty Holiday gave our industry – and the economy – a real boost and according to the Office for National Statistics, UK average house prices “increased by 7.6% over the year to November 2020”, the highest growth rate since 2016.
We and other agents across the country have reported increased demand, and a strong appetite from both buyers and sellers to get moving.
And keep moving you can, but there are definite rules to be followed.
Keeping a Blog updated is a full-time job and when you have other full-time commitments, something has to give! So, like a lot of my readers and followers of the Blog, I must prioritise my workload. Serving my clients is paramount and comes first therefore, you may have noticed I have not been on the blog much recently. When I do get a chance, I try and give you a bit of a read instead of my usual word count. In recent weeks I have had several conversations with Walsall Landlords and Walsall Property owners all asking me the same question time and again if, the Walsall property market will crash in 2021…??
..in the last few months, the Walsall (and UK) property market has resisted and defied every economist’s prediction. With the economy a shadow of its former self, unemployment set to hit 11.9%, the Government on track to borrow nearly half a trillion pounds to pay for Coronavirus support packages etc., all of this has had no effect on Walsall homeowner’s enthusiasm or capability to want to move home. It highlights the influence of both the emotional impact of lockdown and the enticing appeal of saving thousands of pounds on your Stamp Duty Tax bill.
For the last few months, the Walsall property market has been akin to a surfer, riding an unexpectedly large wave. The question is, will the surfer crash down (i.e. the property market) into the rocks or will it calmly arrive at the beach unscathed? Well looking at house prices firstly…
The buy-to-let market in Walsall is about to enter a challenging 12 to 24 months. Yet by looking back at the last recession and what is happening now, there are crucial lessons all Walsall landlords can learn to protect themselves, and in fact create opportunities both in the short term and ultimately the longer term. For the purposes of this article, I would like to split these and look at the challenges and then the opportunities.
So, let’s consider the challenges ahead for Walsall landlords …
The impending rise in unemployment stands to hamper tenants’ ability to pay their rent.
The current rents being achieved pushing affordability in some cases out of reach for many tenants.
The possible Capital Gains Tax changes might mean an increase in tax paid by Walsall landlords when they come to sell their Walsall buy-to-let (BTL) properties.
Since going into lockdown in March, the Government proclaimed a ban on tenant evictions, pledging that no tenant in a private rented home, who had lost their wages due to Covid-19 would be kicked out of their private rented home until the late summer. Fast forward to August and the press were being briefed as late as Wednesday 19th August that this freeze in evictions in England and Wales would cease on the 23rd August. That was until just after 4pm Friday 21st August when Mr Jenrick, the Housing Minister, announced that the eviction ban would be extended for a further four weeks and buy to let landlords must also now give their tenants six months notice to gain possession.
Cue crocodile tears for all the 4,291 Walsall landlords
My Blog reading friends may be aware of the ‘eviction ban’ introduced at the start of the pandemic. The good news is this is being lifted on the 23rd August 2020.
Our government recently announced changes to the eviction processes in England and Wales. These temporary measures aim to help the courts cope with the influx of possession proceedings once the ‘eviction ban’ is lifted.
The changes include claimants needing to issue a “reactivation notice” to resume halted evictions and will be effective until March 28th, 2021.
As if Walsall landlords and landlords across the country don’t have enough to contend with, new rules on Electrical Inspection Condition Reports (EICR) has kicked in from this month.
In my day job at Ashmore Lettings & Sales, historically we have always advised landlords to conduct this check to obtain a condition report. Therefore, most of our clients are already ahead of the game. I have to admit, explaining this to some landlords has been an uphill battle especially, when my colleagues in the industry dissuaded many Walsall landlords to not obtain an EICR.
“So where is the Walsall property market heading?”. “How will a recession affect the market?”. Just a couple of common questions I’ve been fielding recently. As usual, for the benefit of my Blog reading friends, here are my thoughts…
There are plenty of investors who think nothing of legally committing to buying a property ‘off plan’ before it’s built – yet over the last few weeks, it has become the norm in the resale (second-hand) Walsall property market and they have now stolen a march and bagged some property bargains.
Normally, the physical viewing is the first step of the resale house buying process … yet now it’s becoming the ‘new normal’ that some Walsall agents are carrying out semi-professional video viewings or video tours. Even homeowners are getting in on the act and managing a Facetime or Zoom video viewing by walking around their house with their mobile phone.
On the 13th May 2020 the Government announced that the Estate & Letting Agency industry could reopen meaning people could view houses, visit agents and move home be they tenants, buyers, landlords or home sellers. This is all subject to general and specific social distancing rules, specific hygiene regulations and suitable PPE being used.
So what has been happening in the last few weeks in the Walsall property market?
When it comes to buy-to-let (BTL) deals in Walsall, there hasn’t been much to sing and dance about in recent times. But if you look underneath the covers…there are always hidden gems to be found. Some of my Blog reading friends may know that I have been quietly plugging away in the background looking at deals and helping clients connect the dots to help make those all important life changing decisions. Like people come in all shapes and sizes so does their area of knowledge/ expertise. In recent times I have had my Walsall Property Sourcing Clients ask me a similar question which, I thought I would answer here by providing an insight into some of the reasons why I view Walsall BTL investments the way I do…
…so without further ado…!! Above pictures are of two seemingly investable properties for a Walsall Landlord to consider. However, when you delve a little deeper and past the numbers, what do you actually see…?
There is no doubt we are living in challenging times. Until recently I thought, the main talking points this April would be around changes to EPCs and EICRs – but things are a little different now.
Walsall Landlords and tenants have a lot of questions about what all of this means for them and what support will be available during the coronavirus pandemic if they need it.
Over the past couple of weeks information/ announcements have been coming through thick and fast. To help you as best as possible I’ve put together some of the primary information issued by the government for the private rental sector. We’re all aware that things are changing almost daily, and we’re keeping a close eye on the news as the government continues to issue further guidance and support. The information I have to date is as of 31/03/2020.