The Aylesbury Property Blog for landlords...

The second in our series of videos discussing the Aylesbury property market and all things lettings.
We try to deliver news and property articles in a format that you can enjoy...any comments will be welcomed.
Have a great weekend.

With 11,162 people in Private Rented Properties in Aylesbury - Should you still be investing in Aylesbury Buy To Let?

As a buy to let landlord in Aylesbury today, I feel a little bruised by the assault made on my wallet after being (and continuing to be) ransacked over the last 12 months by HM Treasury’s tax changes on buy to let. To add insult to injury there has been a tempering of the Aylesbury property market with property prices not increasing by the levels we have seen in the last few years. I don’t think we will see a drop in property prices this year but if Aylesbury property prices did drop, the downside is that first time buyers could be attracted back into the Aylesbury property market. This would mean less demand for renting (rents would go down). Yet, before we all run for the hills, these things could be serendipitous to Aylesbury landlords, almost a blessing in disguise if this was to be the case. 

Aylesbury has a population of 71,076, so when I looked at the number of people who lived in private rented accommodation, the numbers astounded me … 

Aylesbury - Accommodation Type and the Number of Occupiers
Owned outright - Aylesbury	Owned with a mortgage - Aylesbury	Shared ownership (part owned and part rented) - Aylesbury	Social rented (aka Council Housing) -  Aylesbury	Private rented - Aylesbury	Living rent free - Aylesbury
14,301	33,466	724	10,918	11,162	505
20.1%	47.1%	1.0%	15.4%	15.7%	0.7%

 Yields will rise if Aylesbury property prices fall, which will also make it easier to obtain a buy to let mortgage, as the income would cover more of the interest cost. If property values were to level off or come down that could help Aylesbury landlords add to their portfolio. Rental demand in Aylesbury is expected to stay solid and probably even see improvements. However, there is something even more important that Aylesbury landlords should be aware of: the change in the nature of these 20 something potential first time buyers. 

I have just come back from a visit to relations after a family get together. I got chatting with a nephew and his partner.  Both are in their mid/late twenties, both have decent jobs and they rent. Yet, here was the bombshell, they were planning to rent for the foreseeable future with no plans to even save for a deposit, let alone buy a property. I enquired why they weren’t planning to buy? The answers surprised me as a 50 something, and it will you. Firstly, they don’t want to put cash into property, they would rather spend it on living and socialising by going on nice holidays and buying the latest tech and gadgets. They want the flexibility to live where they choose and finally, they don’t like the idea of paying for repairs. All their friends feel the same. I was quite taken aback that buying a house is just not top of the list for these youngsters. 

 

So, as 15.7% of Aylesbury people are in rented accommodation and as that figure is set to grow over the next decade, now might just be a good time to buy property in Aylesbury – because what else are you going to invest in?  Give your money to the stock market run by sharp suited city whizz kids – because at least with property – it’s something you can touch - there is nothing like bricks and mortar!

What is worth buying to let in Aylesbury, my top 3.

The Aylesbury sales market continues to be surprisingly strong. I expected prices to falter a little in the first quarter of 2017 as buyers sat on the fence and landlords took stock of what is going on . But prices are still solid although we are seeing the usual first quarter optimistic overpricing with some agents so you need to carry out your research before committing as usual. As has been the case for some time these bullish prices are supported by a lack of supply rather than a strong demand...but there is no sign of this changing any time soon.

In this environment good purchases are hard to find, no such thing as a bargain any more!
However there are still sensible buys and a hunt around today shows the following three properties. Only one of these is available via Mortimers, you will need to follow the link and contact the selling agents directly for any interest in the others.

Fairford Leys Aylesbury apartment with potential 5.36% gross yield

What appears to be a smart two bedroom flat on Fairford Leys £195,000 guide price. There is very little of quality sub £200k when it comes to two bedroom apartments in good locations, this one appears to fit the bill. It is of the smaller design without an ensuite but still works well as a rental.
click here to see details on Rightmove
You should see a rental return of around £825 giving a gross yield of over 5%. If you can nibble the price down to £190,000 and improve the rent to £850 this increases to 5.36% gross yield...very respectable. In 2014 these and similar were selling for around £150,000 so there has been good capital growth which looks set to continue.

Rye Close Aylesbury two bedroom semi with 4.16% gross yield at £245,000

This looks like a good buy and in good condition, not sure why it has been on the market since December unless the agent has failed to change it's status. In any event tis represents good value for a buy to let likely to let for around £850 giving a gross yield of 4.16% with great potential for capital growth.
click here to see details on Rightmove

Cooks Road Fairford Leys Aylesbury, two bedroom house, gross yield of 4.07%

This excellent two bedroom house is available via Mortimers click here to see details on Mortimers website
Good presentation, cloakroom and garage are some of the benefits from this modern house on the edge of the estate. The price is sensible, £264,950 and you are likely to achieve a rent around £900 giving a respectable gross yield of 4.07%. But the big plus for Fairford Leys property is the potential for good capital growth whilst achieving good rent , low maintenance costs and a lack of void periods.
Properties similar to this were selling in the region of £190,000 in 2014 and at present the potential for further capital growth looks good. This house would be a great property to start off your portfolio or indeed a great addition to an existing one.

As always carry out your own research. If you want to sanity check a property your are thinking of buying to let please get in touch. My advice and knowledge are free, my opinions driven by my own experience as a landlord as well as an estate agent of many years. Get in touch  

181 Aylesbury Households Occupied by OAP Renters

Recent statistics published by the Office of National Statistics show that there are 267,704 private rented households in the Country that are occupied by people aged 65 and older, meaning 4.39% of OAP’s are living in private rented property. 

It got me thinking two things. How many of these OAP’s have always rented and how many have sold up and become a tenant?  In retirement, selling up could make financial sense to the mature generation in Aylesbury, potentially allowing them to liquidate the equity of their main home to enhance their retirement income.  I wanted to know why these older people rent and whether there was opportunity for the buy to let landlords of Aylesbury? 

The Prudential published a survey recently that said nearly six out of ten OAP renters had never owned a home.  Two out of ten OAP renters were required to sell up because of debt, just about one in ten OAP renters sold their property to use the money to fund their retirement and the remaining one out ten OAP renters, rented for other reasons. 

Funding retirement is important as the life expectancy of someone from Aylesbury at age 65 (years) is 19.4 years for males and 21.6 years for females (interesting when compared to the National Average of 18.7 years for males and 21.1 years for females).  The burdens of financing a long retirement are being felt by many mature people of Aylesbury.  The state of play is not helped by rising living costs and ultra-low interest rates reducing returns for savers. 

So, what of Aylesbury?  Of the 5,611 households in Aylesbury, whose head of the household is 65 or over, not surprisingly 4,291 of households were owned (76.47%) and 1,016 (18.11%) were in social housing.  However, the figure that fascinated me was the 181 (3.23%) households that were in privately rented properties.

 

Anecdotal evidence, by talking to both my team and other Aylesbury property professionals is that this figure is rising.  More and more Aylesbury OAP’s are selling their large Aylesbury homes and renting something more manageable, allowing them to release all of their equity from their old home.  This equity can be gifted to grandchildren (allowing them to get on the property ladder), invested in plans that produce a decent income and while living the life they want to live.  

These Aylesbury OAP renters know they have a fixed monthly expenditure and can budget accordingly with the peace of mind that their property maintenance and the upkeep of the buildings are included in the rent.  Many landlords will also include gardening in the rent! Renting is also more adaptable to the trials of being an OAP - the capability to move at short notice can be convenient for those moving into nursing homes, and it doesn't leave family members panicking to sell the property to fund care-home fees. 

Aylesbury landlords should seriously consider low maintenance semi-detached bungalows on decent bus routes and close to doctor’s surgeries as a potential investment strategy to broaden their portfolio.  Get it right and you will have a wonderful tenant, who if the property offers everything a mature tenant wants and needs, will pay top dollar in rent!

In times when landlords and their returns are being put under pressure it can pay to consider alternative strategies.

This is what happens when you ask a Husky to smile for the camera!

Aylesbury Unemployment Drops to 3.2% , its impact on the Property Market

It was late May 2016, The Right Hon. Member for Tatton, Mr George Osborne, published an official HM Treasury analysis stating UK house prices would be lower by at least 10% (and up to 18%) by the middle of 2018 compared with what is expected if the UK remained in the European Union. So, eight months on from the Referendum, are we beginning to see signs of that prophecy? The simple answer is yes and no. 

A good barometer of the housing market the share price of the big UK builders. Much was made of Barratt’s share price dropping by 42.5% in the two weeks after Brexit, along with Taylor Wimpey’s equally eye watering drop in the same two weeks by 37.9%. Studying the most recent set of data from the Land Registry, property values in Aylesbury are 0.23% down month on month (and the month before that, they had barely grown with an increase of only 0.11%) – so is this the time to panic and run for the hills?  

Doom and Gloom then? Well, let’s consider the other side of the coin. 

It is dangerous to look at short term. I have mentioned in several articles, that the heady days of Aylesbury property prices rising quicker than a thermometer in the desert sun between the years 2011 and late 2016 are long gone. Yet it might surprise you that during those impressive years of house price growth, the growth wasn’t smooth and all upward. Aylesbury property values dropped by 1.18% in January 2012 and 2.06% in June 2013 – and no one batted an eyelid then. 

You see, property values in Aylesbury are still 12.16% higher than a year ago, meaning the average value of an Aylesbury property today is £371,100. Even the shares of those new home builders Barratt have increased by 43.3% since early July and Taylor Wimpey’s have increased by 37.3%. The Office for Budget Responsibility, the Government Spending Watchdog, recently revised down its forecast for house-price growth in the coming years - but only slightly.  

The Aylesbury housing market has been steadfast partly because the wider economy has performed better than expected since Brexit. There is a robust link between the unemployment rate and property prices, and a flimsier one with wage growth. Unemployment in the AVDC area stands at 3,300 people (3.2%), which is considerably better than a few years ago. In 2013 there were 5,400 people unemployed (5.8%) in the same council area.  

However, inflation is the only thing that does worry me. Looking at all the pundits, it will reach at least 3% (if not more) in the latter part of 2017 as the drop in Sterling in late 2016 renders our imports with higher prices. If that transpires then the Bank of England, whose target for inflation is 2%, may raise interest rates from 0.25%. However, that won’t be so much of an issue as 81.6% of new mortgages in the UK in the last two years have been fixed-rate and who amongst us can remember 1992 with Interest rates of 15%!  

Forget Brexit and yes inflation will be a thorn in the side – but the greatest risk to the Aylesbury (and British) property market is that there are simply not enough properties available thus keeping house prices artificially high. Good news for those on the property ladder, but not for those first-time buyers that aren’t!

Posing for a treat.

£8.48bn – The total value of all Aylesbury Property Market

“How much would it cost to buy all the properties in Aylesbury?”

This fascinating question was posed by the 11-year-old son of one of my Aylesbury landlords when they both popped into my office before the Christmas break (that seems an age away now!). I thought to myself, that over the Christmas break, I would sit down and calculate what the total value of all the properties in Aylesbury are worth … and just for fun, work out how much they have gone up in value since his son was born back in the autumn of 2005.

In the last 11 years, since the autumn of 2005, the total value of Aylesbury property has increased by 77% or £3.69 billion to a total of £8.48 billion. The FTSE100 has only risen by 30.78% and inflation (i.e. the UK Retail Price Index) rose by 37% during the same 11 years. 

When I delved deeper into the numbers, the average price currently being paid by Aylesbury households stands at £300,629.… but you know me, I wasn’t going to stop there, so I split the property market down into individual property types in Aylesbury; the average numbers come out like this .. 

Aylesbury Property Market
Average Value of a Detached Property	Average Value of a Semi-Detached Property	Average Value of a Terraced/Town House Property	Average Value of an Apartment
£541,759	£288,679	£261,924	£169,236

 ... yet it got even more fascinating when I multiplied the total number of each type of property by the average value. Even though detached houses are expensive, when you compare them with the much cheaper terraced/town houses and apartments, you can quite clearly see detached properties don’t fare any better in terms of total pound note value of the terraced/town houses and apartments.

Total Value of all the Aylesbury Detached Properties	Total Value of all the Aylesbury Semi-Detached Properties	Total Value of all the Aylesbury Terraced/Town House Properties	Total Value of all the Aylesbury Apartments
£2,384,281,359	£2,692,509,033	£2,473,610,256	£936,044,316

 What does this all mean for Aylesbury?  Well as we enter the unchartered waters of 2017 and beyond, even though property values are already declining in certain parts of the previously over cooked Central London property market, the outlook in Aylesbury remains relatively good as over the last five years, the local property market was a lot more sensible than central London’s.

 

Aylesbury house values will remain resilient for several reasons. Firstly, demand for rental property remains strong with continued immigration and population growth.  Secondly, with 0.25 per cent interest rates, borrowing has never been so cheap and finally the simple lack of new house building in Aylesbury not keeping up with current demand, let alone eating into years and years of under investment – means only one thing – yes it might be a bumpy ride over the next 12 to 24 months but, in the medium term, property ownership and property investment in Aylesbury has always, and will always, ride out the storm.

 

As always, my articles can be found at the Aylesbury Property Market Blog here or you can pop in to see me any time you are passing my office in Temple Street.

Forecasts for the Aylesbury property market 2017.

There have been many wild predictions in the media for 2017...according to those that tell us they know best we are going to see something between a crash and a boom! Not overly helpful. I enlisted the help of some friends and local professionals working on the front line to get their view...

As always if you are thinking of buying for the first time or adding to your existing portfolio get in touch ian@mortimersaylesbury.co.uk

Are there good returns to be had in Aylesbury in 2017?

It is great to be in the new year! Once December arrives the new year always seems to take an age to arrive. When it does you can wipe that slate clean and the next 12 months stretch endlessly out in front of you with all the great opportunity a new year brings. Many of you will be considering property matters.

The mortgage market has changed and the affordability criteria mean you will most likely need a 40% deposit to get the best rates. If you are buying a two bedroom property that equates to a substantial £100,000 plus costs including weighted Stamp Duty.

Is it best to sit back and wait for the market prices to ease before committing? Unfortunately this does not look like a good strategy as supply is so weak that the number of buyers still supports current pricing.

What does your £250,000 buy in the current market. As frequent readers know I always suggest buying a two bedroom house if budget allows and Fairford Leys is my suggested location.
This what you can buy today...click here.

You can buy a two bedroom house in a great location for your money but what will it rent for...click here.

So lets say you buy at the full price of £250,000 and achieve a rent of £900, lower than those shown here. That gives you a gross yield of 4.32% still way better than the miserly banks will give you. PLUS you get capital growth! A year ago my sales colleagues were selling similar property around £200,000, so if you had taken this action a year ago you would have around £50,000 plus your monthly return to show for your efforts. Not bad for a pretty safe investment of £100,000.

Obviously there is no guarantee that returns will be as good over the next few years but most of us consider property a long term strategy, for our pension pot or as a legacy for children.

Pension rules have been relaxed and several of my landlords have taken advantage to generate a deposit by drawing down from their pension (not for everybody). Some have had endowment policies mature (remember them!) while others have inherited money. But whatever your situation, YES there are still good returns to be had, but you need to be canny over where you buy and what you pay. You need to take the right legal and financial advice, taking advantage of the best buying methods to ensure maximum returns and tax efficiency.
I can help with many of these areas and put in touch with the right professionals, no obligation, no fuss, just helpful advice. You can read the 'John and Alice story' here

Good luck for 2017 whatever your plans.

Nala has promised to smile more this year

ian@mortimersaylesbury.co.uk

Can we blame Aylesbury landlords for the housing crisis in the town?

Many of these landlords are also known as the ‘Baby Boomer Generation’. These Aylesbury people were born after the end of the Second World War as the country saw a massive rise in births as they slowly recovered from the economic hardships experienced during wartime.

Throughout the 1970’s and 1980’s, they experienced (whilst in their 20’s, 30’s and 40’s) an unparalleled level of economic growth and prosperity throughout their working lifetime on the back of improved education, government subsidies, escalating property prices and technological developments. They have emerged as a successful and prosperous generation. 

Yet some have suggested these Aylesbury baby boomers have (and are) making too much money to the detriment of others, creating a ‘generational economic imbalance’, where mature people benefit from house-price growth while others are forced to pay massive rents or pay large mortgages.

Between 2001 and today, average earnings rose by 65%,

but average Aylesbury house prices rose by 123.6% 

The issue of housing is particularly acute for the generation called the Millennials, who are young people born between the mid 1980’s and the late 1990’s. These 18 to 30 year olds, moulded by the computer and internet revolution, are finding as they enter adult life, that it is very hard to buy a property. These ‘greedy’ landlords are buying up all the property to rent back out to them at exorbitant rents ... it’s no wonder these Millennials are lashing out at buy to let landlords, as they are seen as greedy, immoral, wicked people cashing in on a social despair.

Like all things in life, we must look to the past, to appreciate where we are now.

The three biggest influencing factors on the Aylesbury (and UK) property market in the latter half of the 20^th Century were, firstly, the mass building of Council Housing in the 1950’s and 60’s. Secondly, for the Tory’s to sell many of those Council Houses in the 1980’s and finally 15% interest rates in the early 1990’s which resulted in many houses being repossessed. It was these major factors that underpinned the housing crisis we have today in Aylesbury.

 

In 1995 the USA relaxed its lending rules by rewriting the Community Reinvestment Act. This Act saw a relaxation on the Bank’s lending criteria as there was pressure on these banks to grant mortgages in low wage neighbourhoods, as the viewpoint in the USA was that anyone (even someone on the minimum wage) any working class person should be able to buy a home.  Unsurprisingly, the UK followed suit in the early 2000’s, as Banks and Building Society’s relaxed their lending criteria and brought to the market 100% mortgages, even Northern Rock started lending every man and his dog 125% mortgages. 

We can observe today those very same banks (that lent 125% with a just note from your Mum and a couple of breakfast cereal tokens), reciting the Bank of England hymn-sheet of responsible-lending. On every first time buyer mortgage application, they are now looking at every line on the 20-something’s bank statements, asking if they are spending too much on socialising and holidays ... no wonder these Millennials are reluctant to ask for a mortgage (as more often than not after all that – the answer is negative). 

Conversely, you have unregulated Buy To Let mortgages. As long as you have a 25% deposit, have a pulse, pass a few very basic yardsticks and have a reasonable job, the banks will throw money at you ... I mean Virgin Money are offering 2.99% fixed for 3 years – so cheap!

In 1971, around 50% of people owned their own home and, as the baby-boomers got better jobs and pay that rose to 69% by 2001. Homeownership was here to stay as for many it’s very much a cultural thing here in Britain to own your own home. 

Many of these same baby boomers started to jump on the band wagon of Aylesbury buy to let properties as an investment. Aylesbury first time buyers were in competition with Aylesbury landlords to buy these smaller starter homes … pushing house prices up in the 2000’s beyond the reach of many first time buyers. Alas, it is not as simple as that. Other factors come into play, such as economics, the banks and government policy. But are Aylesbury landlords really fanning the flames of the Aylesbury housing crisis? 

The landlords of the 4,701 Aylesbury rental properties are not exploitive and are in fact, making many positive contributions to Aylesbury and the people of Aylesbury. Aylesbury (and the rest of the UK) isn’t building enough properties to keep up with the demand; with high birth rate, job mobility, growing population and longer life expectancy.

 

According to the Barker Review, for the UK to stand still and meet current demand, the country needs to be building 8.7 new households each year for every 1,000 households already built. Nationally, we are currently running at 5.07 per thousand and in the early part of this decade were running at 4.1 to 4.3 per thousand. 

It doesn’t sound like a lot of difference, but for Aylesbury to meet its obligation on the building of new homes, Aylesbury would need to build 251 households each year. We are missing that figure by around 105 households a year.

For the Government to buy the land and build those additional 105 households, it would need to spend £40,160,927 a year in Aylesbury alone. Add up all the additional households required over the whole of the UK and the Government would need to spend £23.31bn each year.

It is the property developers who are buying the old run-down houses and office blocks and turning them into new attractive homes to be rented privately to Aylesbury families or Aylesbury people who need council housing because the local authority hasn’t got enough properties to go round.  

The bottom line is that, as the population grows, there aren’t enough properties being built for everyone. Rogue landlords need to be put out of business, whilst tenants should expect a more regulated rental market, with greater security for tenants, where they can rely on good landlords providing them high standards from their safe and modernised home. As in Europe, where most people rent rather than buy, it doesn’t matter who owns the house – all people want is a clean, decent roof over their head at a reasonable rent.  

So only you, the reader, can decide if buy to let is immoral, but first let me ask this question - if the private buy to let landlords had not taken up the slack and provided a roof over these people’s heads over the last decade ... where would these tenants be living now?

If you are a landlord future demand looks secure set against this climate. If you are thinking of becoming a landlord demand is not what should concern you. Buy the right product in the right location at the right price and all will be well. To discuss your plans get in touch ian@mortimersaylesbury.co.uk

 

Nala is happy now it is so cold, makes her feel at home!

 

Aylesbury OAP’s sitting on £2.17 bn of Property

Aylesbury people aged over 65 currently hold more housing wealth in their homes than the annual GDP of the whole of the Scottish Borders … and this is a problem for everyone in Aylesbury!

Many retiree’s want to move but cannot, as there is a shortage of such homes for mature people to downsize into. Due to the shortage, bungalows command a 10% to 20% premium per square foot over houses of the same size with stairs. To add to the woes, in 2014, just 1% of new builds in the UK were bungalows, according to the National House Building Council - down from 7% in 1996.

Research has found that there are 5,738 households in Aylesbury owned outright (i.e. no mortgage) by over 65 year olds. Taking into account the average value of a property in Aylesbury, this means £2.17 billion of equity is locked up in these Aylesbury homes, compared to the GDP of the whole of the Scottish Borders being £1.7 billion of GDP.

A recent survey by YouGov, found that 36% of people aged over 65 in the UK are looking to downsize into a smaller home. However, the Government seems to focus all its attention on first-time buyers with strategies such as Starter Homes to ensure the youngsters of the UK don’t become permanent members of ‘Generation Rent’. Conversely, this overlooks the chronic under-supply of appropriate retirement housing essential to the needs of the Aylesbury’s rapidly ageing population. Regrettably, the Aylesbury’s housing stock is woefully unprepared for this demographic shift to the 'stretched middle age’, and this has created a new 'Generation Trapped’ dilemma where older people cannot move.

Some OAP’s who are finding it difficult to live on their own, are unable to leave their bungalow because of a lack of sheltered housing and ‘affordable’ care home places. So, older retirees can't leave bungalows, younger retirees can't buy bungalows and younger people can't buy family houses.

Interestingly, adding insult to injury, the problem will only get worse, as in the 50 year old to 64 year old homeownership age range there are an additional 4,021 Aylesbury households that are mortgage free and a further 5,039 Aylesbury households who will be completing their mortgage responsibility. With Government projections showing the proportion of over 65’s will rise by over a third from the current 17.7% to 24.3% of the population in the next 20 years ... this can only add greater pressure to the Aylesbury Property market.

  

House prices have rocketed over the last 40 years because the supply of property has not kept up with demand. With migration, people living longer and high divorce rates (meaning one family becomes two) we need, as a Country, 240,000 properties to be built a year to just stand still. In the 1990’s and early 2000’s, the Country was building on average 180,000 to 190,000 households a year, but since the Credit Crunch (2009), that has only been between 130,000 and 145,000 households a year.

The solution …. release more land for starter homes, bungalows and sheltered accommodation because land prices are killing the housing market as the large firms dominating the construction industry are more likely to focus on traditional houses and apartments. My opinion – until the Government change the planning rules and allow more land to be built on – Bungalows could be a decent bet for future investment as they continue to attract ever growing premiums?

As always any thoughts are always welcome, ian@mortimersaylesbury.co.uk

I wish you all a merry Christmas and a prosperous new year.

Aylesbury Property Market – Q4 Update

Well, hasn’t 2016 been eventful. The ups and downs of Brexit, the Queen’s 90^th, Andy Murray winning Wimbledon, Trump, Bake Off to Channel 4 and something close to the hearts of every buy to let landlord and homeowner in Aylesbury ... the Aylesbury property market.

So, let’s look at the Aylesbury property market...

In the last month, Aylesbury property values dropped by 0.08%, leaving them, year on year 13.69% higher, whilst interestingly, Aylesbury asking prices are down 2.0% month on month. All three statistics go to show the Aylesbury property market has recovered well after the summer lull, which was worsened by the uncertainty surrounding the EU vote back in June. Irrespective of all the issues, the average value of an Aylesbury home now stands at £379,500.

Generally, Aylesbury asking prices continue to hold up well, as asking prices are 4.7% higher year on year. At this time of year, asking prices tend to drop on the run up to Christmas and locally, they had dropped by 2.0% last month (November 2016), although this compares well with last year’s drop in Aylesbury asking prices, as we saw asking prices drop by 1.1% in November 2015.

After chatting with fellow property professionals in Aylesbury, all of us have seen the number of property sales fall slightly, suggesting a slowing market. However looking at what our own sales team have done in December so far, they have seen much improved results when comparing with previous years.

The numbers are limited, so it’s interesting to take note from a recent survey by the Royal Institution of Chartered Surveyors, stating new buyer enquiries and new instructions are falling at the same rate, suggesting that there will not be a downward pressure on property values.

Looking at the figures for the UK, property values are generally rising slower than a few years ago, but on a positive note, there's still growth across the UK. You see, slowing property value growth isn't solely Brexit related, but after a number of 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 rates being at a record low of 0.25% are helping the property market. The cut in interest rates in the late summer was the medicine for the post-Brexit worry and will, as a consequence, ensure that the UK economy continues to be underpinned by buoyant property prices.

 So, what will happen in 2017 in the Aylesbury property market?

Some say until we know what type of exit the UK will make from the EU it is hard to evaluate the outcome. Although, I believe, the whole Brexit issue is a sideshow to the main issue in the UK (and Aylesbury) 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. Aylesbury has an ever-growing population: with immigration (we still have at least two years of free movement from EU members into the UK), people living longer and the fact we need thousands of additional households as the country has nearly 115,000 divorces a year (where one household becomes two households).

As always, you can find me in my Temple Street office and I welcome your thoughts when you are next in town. Ian@mortimersaylesbury.co.uk

 

I'm looking forward to Christmas Turkey.