After the shock of the
Conservatives returning to power with a majority at Westminster, all the
potential issues and possible uncertainties of a hung parliament has lifted the
cloud from the Canterbury property market.
Talking to other Canterbury agents, surveyors and solicitors in the area
over the last few days, there are signs that this has started a new impetus for
the Canterbury property market after a subdued six months, when an amalgamation
of tougher lending conditions, a natural correction after the strong recovery
in Canterbury property prices in 2014, and political uncertainty ahead of the
General Election slowed demand.
Against the back drop of Labour’s
election promises of rent controls and three year tenancies, some Canterbury
buy to let landlords were waiting to see how these new policies would be
implemented before they committed themselves to buying more property for their buy
to let portfolio. Now that uncertainty has been removed, the long term picture
is very positive.
So, with all that uncertainty now
removed, where next for the Canterbury property market? Well with inflation at zero and with the money
markets happy David Cameron is still at No.10, the Bank of England have no
reason to raise interest rates until 2016 at the earliest. As mortgage rates
are at their lowest levels since 2010, landlords with large deposits will now
be wooed by the mortgage companies in the coming months with low rates.
You see over the past couple of
years, Canterbury landlords have benefitted from a booming Canterbury job
market. Unemployment in the city has dropped to 1.6%, as a year ago 1,229
people were claiming unemployment benefit compared to today’s 806. With more
jobs and better pay, as the level of rents is directly linked to tenant’s
wages, there has been an increase in the rental prices tenants are willing to
pay for good quality Canterbury properties.
Some landlords might be nervous
about Tory’s plans for the housing market in the next five years in terms of
tenant demand for their rental properties. One plan is for Housing Association
tenants to have the right to buy their property. These kind of tenants were
never in the private rented sector and will actually increase the supply of
properties in the housing stock in decades to come. The Government ‘Help to Buy
Scheme’ has only helped to buy 31 Canterbury properties since April 2013. Considering 693 properties have changed
hands in the last year alone in Canterbury, I don’t think it has made a
huge difference to our local property market.
The biggest matter, when it comes
to tenant demand of rental property going forward, comes from the shift in the
mindset and attitudes towards renting itself. Twenty years ago you were seen as
a second class citizen if you rented a property. In Canterbury, as in the rest
of the UK (apart from Central London), renting continues to offer good value
for money for tenants. If you are an
existing landlord in Canterbury or thinking of becoming one (or as we like to
call you .. a FTL .. a ‘first time landlord’), then I must suggest you seek out
specialist advice and opinion. Like many agents in Canterbury, we will happily
give you our opinion on the current state of the market and the
advantages/disadvantages to investing in the Canterbury property market if you
pop into our offices. However, if time is at a premium, another source of
information on the Canterbury Property Market is the Canterbury Property Blog at
www.canterburypropertyblog.com
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