The ‘Right to Buy’ scheme was a policy introduced by Maggie Thatcher in 1980 which gave secure council tenants the legal right to buy the Council home they were living in with huge discounts. The heyday of Council ‘Right To Buys’ was in the 80’s and 90’s, when 1,719,368 homes in the country were sold in this manner between October 1980 and April 1998. However, in 1997, Tony Blair reduced the discount available to tenants of council houses and the numbers of properties being bought under the Right to Buy declined.
So what does this mean for Aylesbury homeowners and landlords?
Looking at the figures for our local authority, whilst the number of ‘Right to Buys’ have dwindled over the last few years to an average of only 124 ‘Right to Buy’ sales per year, one must look further back in time. Looking at the overall figures, 5,760 Council properties were bought by council tenants in the Aylesbury Vale District Council area between 1980 and 1998. Big numbers by any measure and even more important to the whole Aylesbury property market (i.e. every Aylesbury homeowner, Aylesbury landlord and even Aylesbury aspiring first time buyers) when you consider these 5,760 properties make up a colossal 11.5% of all the privately owned properties in our area (because in our local authority area, there are only 49,702 privately owned properties).
Aylesbury first time buyers and landlords can now buy these ex-council properties second hand as those original 80’s and 90’s tenants (now homeowners) have more than passed the time of any claw back of the discount they received (council discount was repayable if the first owner sold within a stipulated time period - usually 5 years).
Yes, the modern stuff being built in Aylesbury is lovely, but some landlords purchase buy to let property solely based on where they would choose to live themselves, instead of choosing with a business head and choosing where a tenant would want to live ... because remember the first rule of buy to let property … you aren’t going to live in the property yourself. What an ex-council property may lack in kerb appeal can be more than made up for in other ways. Tenants are often more worried about how close the property is to a particular school or family member for child care.
Whilst ex-council properties tend to increase in value at a slower rate than more modern properties, that is made up for by the higher yields – and those built between the wars or just after are really well built. Tenant demand for such properties is good since Aylesbury property values are so expensive, a lot of people can’t get mortgages to buy, so they will reconcile themselves to renting, meaning there is a good demand for that sort of property to rent. The very fact the council were forced to sell these Aylesbury properties in the 80’s and 90’s, means that today’s younger generation who would have normally got a council house to live in themselves, now cannot as many were sold ten or twenty years ago.
So, Aylesbury landlords - don’t dismiss ex-council houses and apartments – but remember the first rule of buy to let (as above). However, those very same Aylesbury landlords should go in with their eyes open and take lots of advice. Not all ex-council properties are the same and even though they have good demand and high yields, they can also give you other headaches and issues when it comes to the running of the rental property. One source of advice as ever is the Aylesbury Property Blogwww.theaylesburypropertyblog.blogspot.co.uk/ or call me, Ian Davies, on 01296 398555
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