Monday, 7 March 2016
Private Renting in Canterbury increases by 160% in 20 years
You find me in a reflective mood today as I want to talk about the future of investing in property in Canterbury. The truth is that we have got fat and lethargic, with many people having mistaken the ever rising Canterbury (and in fact the whole of the UK) property market since the 1960’s as the eternal gift that kept giving as property prices constantly rose and doubled every five to seven years.
The days of making money from property
as easy as falling off a log, like taking candy
from a baby, are sadly over my Canterbury Property Blog
Whilst George Osborne has decided now is the time to milk the ‘Golden Cow’ of UK’s private landlords, with changes in taxation for buy to let property, many pundits are predicting the end of buy to let as we know it. However, it is still possible to make a reasonable, profitable and safe return on property with these changes. You see, I have always seen investing in the Canterbury buy to let market (as I would anywhere in the UK), as I might see Mother Nature, creating some truly wonderful stunning warm weather but at the same time, she will bite, creating catastrophic situations such as snowstorms and hurricanes. You need to study the market, take advice and opinions from many people and then decide what the proverbial property weather will be … remember, tenants will always want a roof over their head and I don’t see the HM Government building the millions of houses required to house them?
Nobody knows the future, and yes people can predict but I wouldn’t be afraid of this change .. because as a famous French proverb says, (I told you I was in a reflective mood today), ‘the more things change, the more they stay the same’. I mean, no one could have predicted how the property market has changed in Canterbury over the last couple of decades? Looking specifically at the Canterbury Parliamentary Constituency, twenty years ago, 26,512 households (meaning 68.33% of property) was owned and only 3,103 households were privately rented (meaning 8% of property was rented out by private landlords). Roll the clocks on twenty years and the change has been seismic …. Now 27,121 of properties in the Constituency are home-owners (a drop to only 62.96% being owner occupied) and the jump in private renting has been out of this world, as 8,959 properties are now privately rented proportionally 20.8%). (NB Neighbouring Constituencies show similar changes as well)
Who would have predicted in 1995 the private rental sector
in Canterbury would have grown by 160% in the proceeding 20 years?
Also, if you had asked someone in 1995 to predict what would happen to property values over the proceeding 20 years (i.e. between 1995 and 2015), they might have predicted similar growth to the growth experienced over the previous 20 years (i.e. between 1975 and 1995), which was a very impressive 351.55%. Yes, property values in Canterbury have increased over the last 20 years (between 1995 and 2015), but by a more modest 240.77% (and most of that can be attributed to house price growth between 2000 and 2006.)
The property market is constantly changing and buy to let for too long has been heavily dependent solely on house price growth, where yield has been almost forgotten. I see the changes in tax and landlord and tenant law in a different perspective to the doom-mongers and see it as bringing many opportunities. You might need to change your buy to let benchmarks, your approach to financing or even consider places other than Canterbury in which to invest your money, but this will shine a light on investing in properties with healthier yields and create more realistic long term buy to let opportunities, instead of short term growth bets and wagers.
The advice I give to my landlords, and you my blog reading friends is this; these changes will make some landlords panic, meaning competition for decent Canterbury buy to let bargains will reduce as fear of change kicks in and amateur investors flee the market. These opportunities will provide a more stable platform for knowledgeable and wise Canterbury buy to let landlords to thrive in. If you want to learn more about the Canterbury Property Market, feel free to pop in for a coffee at our office for a chat with me, or failing that, visit the Canterbury Property Blog, where you will find many more articles like this ..solely on the one topic of the Property Market in Canterbury …. www.canterburypropertyblog.com