Following on from last week’s discovery that house prices
have jumped on average in Swanscombe by 18% in the last year, we’ve briefly
condensed information for you on the reported housing market ‘bubble-pop’ that
the media seem so keen on this week.
House prices shooting up? Will the Bank of England increase
interest rates next year? Tough new lending rules? All of these have lent
weight to the idea the housing market is going to deflate at some point
throughout the year. But what will this mean for you as home owners and investors?
Issue: House prices are soaring in the South East
Answer: Oh, the age old issue of supply & demand, don’t you just love it? London & the South East have the fastest growing populations in country – and, unsurprisingly, there is not enough housing in these areas, thus pushing the largest price hikes, and pushing down rental yields. Great if you’re selling, not so much if you’re buying.
Answer: Oh, the age old issue of supply & demand, don’t you just love it? London & the South East have the fastest growing populations in country – and, unsurprisingly, there is not enough housing in these areas, thus pushing the largest price hikes, and pushing down rental yields. Great if you’re selling, not so much if you’re buying.
Issue: No decent rental yields
Answer: There isn’t enough decent stock out there… that’s about the gist of it. Prices are currently so high that they have forced rental yields down. Fine for a cheap property you purchased in 2008, as it’s unlikely to have affected you (rising rental figures help here), but not so great for if you want to add to your portfolio now.
Answer: There isn’t enough decent stock out there… that’s about the gist of it. Prices are currently so high that they have forced rental yields down. Fine for a cheap property you purchased in 2008, as it’s unlikely to have affected you (rising rental figures help here), but not so great for if you want to add to your portfolio now.
Issue: Are the media scaremongering?
Answer: KPMG & Shelter have released some dire figures: if England continues to build less than half of the 250,000 new properties needed yearly, the average house price will rise to £900,000 in 20 years’ time. Bear in mind, the average house price in England in 2009 was £151,000, it’s currently £183,000, and when was the last time this country built 250,000 homes? Where are they getting these figures from?!
Answer: KPMG & Shelter have released some dire figures: if England continues to build less than half of the 250,000 new properties needed yearly, the average house price will rise to £900,000 in 20 years’ time. Bear in mind, the average house price in England in 2009 was £151,000, it’s currently £183,000, and when was the last time this country built 250,000 homes? Where are they getting these figures from?!
Issue: How will affect investor purchasers?
Answer: Positively! Aside from the obvious potential cheaper prices &
higher yields, swathes of people to rent will come to the market as they can’t
secure a mortgage, or are struggling to get a deposit. You’ll have a better choice
of tenant as a lot of potential buyers will be looking to the rental market (although,
in the recovery, they will likely move on to purchase). And you’ll (hopefully)
get a better choice of property to buy (people need to move, slump or no slump).
You’ll have opportunity. What more could you ask for?
For all your rental advice and property needs, call us on
01474 833050, email us here, visit our website, or pop in to Southfleet or
Sutton-At-Hone to speak to us (and don’t forget, you’ll even get a nice cup of
tea to go with your advice).
Have a great Bank Holiday weekend!
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