Walsall Property Market

Comment on the Walsall property market

Are Walsall tenants priced out of the Walsall Property Market?

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , , , ,

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I had an interesting chat with a property landlord the other day about my thoughts on the Walsall Property Market.  The subject of the affordability gap between renting property in Walsall against purchasing came up in conversation and how that would affect tenant demand.  As a local Property Manager I have noticed how, in recent years, our tenancies are being sustained with tenants staying with us for longer.  So my curiosity got the better of me and I just had to take a look at the figures.  Here’s what I found…

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Walsall Property Prices Cut…But Values Go Up!

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , , ,

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Those of you who regularly read my weekly articles in the Walsall Property Blog will know I like to keep abreast of the Walsall Property Market.  Something attracted my attention this week about the local property market, something I wanted to share with my many readers.

Over the last month, there appears to have been an anomaly in the local property market, whereby asking prices in the town have dropped, yet property values have increased.  The average asking price of a Walsall property, according to Rightmove, fell 1.1% this month yet the average value of a Walsall property rose by 1.2%.

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Stamp duty changes kills the Walsall property market?

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , , , , , , ,

 

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As per my previous article, after receiving numerous calls and emails on the recent upcoming changes to the ‘Stamp Duty’, I feel I have to write about the subject this week…

Our Chancellor of the Exchequer, Mr George Osbourne announced in his autumn statement that from April 2016 investors buying any buy to let property will have to pay an additional 3% stamp duty in addition to the standard rate.  This has caused many landlords to ask the question; whether or not purchasing a property in Walsall will still be a viable option?

So for example, It means that the stamp duty bill for a £150,000 buy to let home will rise from the current £3,000 to £7,500 from April next year.

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Many property experts are saying that property in Walsall will be worth less because potential landlords will not be willing to pay as much for them, and if house builders or existing homeowners don’t feel they are going to get as much for them, then there is less motivation to build or sell?… and the person we can blame for this is George himself.  Back in 2012, he chose to utilise the British housing market to kick start the UK economy with subsidies and initiatives such as Funding for Lending and Help to Buy.  However, whilst that helped the Tories get back into power in 2015, some say that this impressive growth in the UK property market has been at the expense of pricing out youngsters wanting to buy their first home.

Others say that this is the straw that is going to break the camels back as, over the next four years, landlords will slowly lose the ability to offset all their mortgage interest against tax on rental income, after changes announced in the Summer Budget.  At the moment, landlords can claim tax relief on buy to let mortgage monthly interest repayments at the top level of tax they pay, typically 40%.  However, over the next four years this will reduced slowly to the basic rate of tax – currently 20%.

So, that’s it then!  Surely this is the end of Buy to Let in Walsall?  Well, it’s not great news is it?  But, before we all run to hills panicking… let me give you another thought.

Although your Stamp Duty bill will rise, George has left a significant loophole in the new rules.  When it comes to selling your investment property, you can offset the purchase costs against any eventual capital gains tax; including stamp duty.

I still firmly believe that total returns from buy to let will continue to outpace other investments, such as the stock market, gilts, bonds and even pensions.  Also, the best part about investing in property is that it is bricks and mortar.  You can touch it, you can feel it, and it isn’t controlled by some City whiz kid in Canary Wharf… the British understand property and that goes a long way!

Buy to let has enough impetus behind it that prospective landlords will continue to buy even with a larger stamp duty bill.  Walsall landlords will need to be savvy with what property they buy to ensure the extra stamp duty costs are mitigated.  Buying buy to let property is a long term venture.  In the past, it didn’t matter what property you bought in Walsall or at what price – you would always make money.  Now with these extra taxes, the adage of ‘any old Walsall house will make money’ has gone out the window.  You wouldn’t dream of investing in the stock market without at least looking in the newspapers or taking advice and opinion from others, so why would you take the same advice and opinion about buying a buy to let property in Walsall?

One source of information, opinion and advice is my Walsall Property Blog; sign up for new articles by email now!

 

Phone: 01922 311016

Email: salekm@ashmorelettings.co.uk

 

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Walsall landlords!! What are the trends of tenants in Walsall?

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , ,

This is a subject that I have touched on quite often recently, however, I really do feel it’s a big issue so make no apologies for mentioning it again from another point of view – the landlord’s!

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I was reading a report the other day produced by the Halifax, about the UK property market and why more and more of the younger generation seem to be renting than buying.  I find it fascinating that over the last ten years, the British obsession of buying a house and the fact that if you rented, you were once seen as a second class citizen, has turned on its head to a point where the hopes and dreams to own a nice home will be replaced by the ambition simply to live in one!  In the latter half of the 20th Century, you left school, got a job, bought a small house and kept buying and selling property; constantly upgrading until eventually they carried you out in a box.

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Could a buy-to-let property in Walsall save you from pension oblivion?

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , ,

Ramblers

I met up with a friend this week who is also a landlord.  He is from the south west part of the country and also uses the services of a professional managing agent to manage his portfolio.  As we were talking, over some light lunch, the subject had to come up and so we obliged.  My friend told me how he was going to rely on his property portfolio to save himself from pension oblivion.  This of course got me thinking so I thought I’d share those thoughts with you below.

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Walsall Landlords Exceed £891 Million in Buy to Let Mortgages!

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , ,

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The nations favourite topic at lunchtime tends to be about ‘the boss’ and in the evening….we can’t stop talking about property!  The hot topic of discussion at the dinner parties, BBQ’s and local pub meetings of the movers and shakers of Walsall is the subject of the local property market, but in particular, buy to let in Walsall.  These people are buying up buy to let properties quicker than a seasoned Monopoly player.. or so it would seem if you read the Sunday papers.  So, is the buy to let market a sure fire way to make money?   Is it something everyone should be jumping into?  Is it a dead cert that you will get a return?  The answer isn’t as simple as that, to all those questions as it all depends on the plan and strategy you apply to your investment similar to any other!

Firstly, the government gives tax breaks to landlords, as it allows the mortgage interest payments on a buy to let property to be tax deductible (some changes are afoot).  A landlord only has to flick through Rightmove or Zoopla, pick any property at random and agree a price.  Find a modest deposit of 25%, often by re-mortgaging their own home, which for an average Walsall terraced house, would mean finding £22,455 for the deposit because the average Walsall terraced house is currently worth £89,818.  Then borrow the rest with a low interest rate buy to let mortgage.  Finally, the landlord would rent out the property in a matter of hours for top dollar and live happily ever after, with the rent then covering the mortgage payments, with loads of money to spare and come retirement have a portfolio of property that would have quadrupled in value in fifteen years.  Sounds wonderful – doesn’t it? Or does it?

Let us not forgot that the half of one per cent Bank of England base rate is artificially low.  The international money markets can be fickle and if interest rates do rise quicker and higher than expected because of some unforeseen global economic situation, that monthly profit will soon turn into a loss as the mortgage will be more than the rent.  Even though tenants are staying longer in their rental property, they still come and go and my guidance to landlords is they should allow for void periods, plus the maintenance costs of a rental property, agent’s fees, building insurance and home emergency cover… all things that eat into that profit.

Interestingly, by my calculations, there are approximately 3,790 Walsall landlords owing in excess of £891million in mortgages on those buy to let properties.   An impressive amount when you consider Walsall only has 0.491% of the all the rental properties in the Country.  It really does come down to a number of important factors going forward to ensure you are water tight for the future.  A lot of my existing landlords are fixing their mortgage rates.  One told me that the Metro Bank are currently offering a 5 year fixed BTL remortgage rate at 3.79% for 5 years based on a 75% loan to value.  I don’t give financial advice, so you must speak with a qualified mortgage advisor.. but that sounds very fair!

However, one thing I do know is this.  Buy to let is a long term investment.  It’s a ten, fifteen, twenty year plan and property prices will go down as well as up.  You wouldn’t dream of investing in the stock market without advice, so why invest in the Walsall Property Market without advice?  We give bespoke, detailed advice to our landlords to enable them to spot trends in the Walsall Property Market before others, enabling them to buy in better properties at better prices.  For example, did you know that flats are selling for around 10% lower than 12 months ago in Walsall yet semi’s are selling for 14% more?  This means we can advise on which properties will go up in value better (or lose less if property prices drop), we can also advise which have lower voids and which properties have higher maintenance issues.

If you would like to discuss anything property related please feel free to contact me and I would love to hear from you.

Phone: 01922 637672

Email: salekm@ashmorelettings.co.uk

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What type of property is best to invest in, in Walsall? Detached or Terraced?

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , ,

One of my professional landlords called me towards the end of last week informing me how he thinks he should be purchasing more detached properties in Walsall.  He told me how he thinks they will bring about better returns when he sells them although he hasn’t sold anything yet.  I thought this didn’t ring quiet true in my mind so, me being me, I began to look at the stats to see what the actual numbers was telling us.

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Rightmove announced that average ‘asking prices’ fell slightly last month by 0.6% in the West Midlands, leaving them 2.9% higher than a year ago.

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The Time Bomb of The Walsall Property Market

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , ,

I had an interesting telephone conversation with a local property developer and landlord.  Amongst other matters we began to talk about the future of the Walsall property market.  He wanted to know my thoughts on the future of the Private Rental Sector (PRS) nationally and especially locally.  As usual I had an opinion and it sounded like he wanted to hear it.  Below are my thoughts on how I think the next 10 years will play out and why I think the PRS is set to grow even further in Walsall.

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Thatcher’s government introduced the right to buy of council homes but that’s not where the British obsession for owning your own home began.  Prior to WW2 the aspiration of the people wasn’t to buy but to rent.  Looking at the country as a whole, in 1951, 30% of residential properties were owner occupied, then every ten years that rose incrementally to 39% by 1961, 51% by 1971, 58% by 1981, 68% by 2001 but after that, it dropped to 63.4% by 2011 and continues to drop today.

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Is the Walsall buy to let Market in Crisis?

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , ,

A Walsall landlord who manages a portfolio of properties called me after reading my Blog.  He was concerned about the Walsall Property Market where he has 4 properties and after the recent changes he is considering whether to exit the market by selling the portfolio.  We discussed many things but mainly he wanted to pick my brains and thoughts around what he called the crisis in the market.  I’m a glass full sort of guy so where others see ‘doom and gloom’, I only see opportunity.

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It was only last summer the soothsayers were predicting the end of the world over the supposed house price bubble that many believed was developing in the West Midlands, including the Bath Property Market.

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Just who are the renters in Walsall?

Head of Juicing @Ashmore Lettings & Sales Ltd Walsall Property Market , , ,

I recently went to a property auction and bumped into one of my landlords!  We got talking about the state of the Walsall property market and whether we, as a country, are turning more and more to the European style of property ownership, where it is the norm to rent as opposed to automatically buying once you have a good job etc.  So I got to work when I returned to my desk….

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Even though a recent report by the Halifax stated home-ownership remains a goal for 85% of twenty to forty five year-olds, there is information emerging that attitudes in the UK towards renting your own home as opposed to owning it have softened, showing more and more, that renting is being seen as a life style choice.  In fact it is recognised in learned circles that the cycle of renting is also repeated by the fact that people who grow up primarily in rented accommodation are themselves more likely to rent than buy.

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