Monday, 16 May 2022

Warrington Property Market to Crash in 2022?


  • According to some newspapers and pundits, the property market boom could soon be over with the increasing interest rates and inflation.
  • In this article, I share the 3 fundamental economic reasons why things are different to the last property market crash.
  • The insider’s way to find out if there will be a property crash.
  • … and 4 reasons why buy-to-let landlords are coming back into the Warrington rental market to protect their wealth and hedge against inflation.
With inflation and the cost-of-living crisis, some say this could cause property values to drop by between 10% and 20% in the next 12 to 18 months.

There can be no doubt that the current Warrington property market is very interesting.

At the time of writing, there are only 186 properties for sale in Warrington (the long-term 15-year average is between 750 and 770), meaning house prices have gone up considerably.

According to the Land Registry …

Warrington property prices have increased by 14%
(or £30,100) in the last 12 months.

So, as Robert Kiyosaki says, ‘the best way to predict the future is to look to the past’. I need to look at what caused the last property crash in 2008 and how that compares to today.

1. Increase in Interest Rates

One reason mentioned as a possible cause of a crash is the rise in the Bank of England interest rates, affecting homeowners' mortgages.

Higher mortgage rates mean homeowners will have to pay a lot more on their mortgage payments, leaving less for other household essentials. In 2007 (and the 1989 property crash), many Warrington people put their houses up for sale to downsize to try and reduce their mortgage payments.

Yet the newspapers fail to mention that 79% of British people with a 
mortgage have it on a fixed interest rate (at an average mortgage rate of 2.03%).
Also, just under 19 out of 20 (93.2%) of all UK house purchases in 2021 fixed their mortgage rate.

So, in the short to medium-term (two to five years), most homeowners won't see a rise in mortgage payments for many years. Also, 27.8% of all UK house purchases were 100% cash (i.e. no mortgage).

Of the 932,577 house purchases registered since February 2021
in the UK, 259,205 were bought without a mortgage.

Yet some people say this will be a problem when all these homeowners come off their fixed rate. The mortgage lending rules changed in 2014, and every person taking out a mortgage would have been assessed at application as to whether they could afford their mortgage payments at mortgage rates of 5% to 6% rates, not the 2% to 3% they may well be paying now.

No pundit says the Bank of England interest rates will go above 2% with a worst-case scenario of 3%. If the Bank of England did raise interest rates to 3%, homeowners would only be paying 4.5% to 5.5% on their mortgages and thus well within the stress test range made at the time of their mortgage application.

This means the probability of a mass sell-off of Warrington properties or Warrington repossessions because of interest rate rises (both of which cause house prices to drop) is much lower.

2. House Price/Salary Ratio

Another reason being bandied about by some people for another house price crash is the ratio of average house prices compared to average wages.

The higher the ratio, the less affordable property is. In 2000, the UK average house price to average salary ratio was 5.30 (i.e. the average UK house was 5.3 times more than the average UK salary). At its peak just before the last property crash in 2008, the ratio reached 8.64.

The ratio now is 8.85, so some commentators are beginning to think we’re in line for another house price crash. However, I must disagree with them because mortgage rates are much lower today than in 2007. For example …

The average 5-year fixed-rate mortgage in 2007 was 6.19%
(just before the property crash), yet today it’s only 1.79%.


So, whilst the house price/salary ratio is the same as the last property crash in 2008, mortgages today are proportionally 71.1% cheaper.

3. Banks Reckless Lending

Another reason for a property crash in 2008 was the reckless lending practices in the run-up to that crash.

The first example of reckless lending was self-certified mortgages. A self-certified mortgage is when the lender doesn’t require proof of income.

In 2007, 24.6% of new mortgages were self-certified mortgages.

So, when the economy got a little sticky in 2008, the people that didn’t have the income they said they had to pay for their mortgages (because they were self-certified) promptly put their properties on the market.

The banks' second aspect of reckless lending was how much they lent buyers to buy their homes. Today, banks want first-time buyers to have at least a 10% deposit and ideally more. There are 95% mortgages available now (meaning the first-time buyer only requires a 5% deposit), yet they are pretty challenging to obtain.

Back in 2005/6/7, Northern Rock was allowing first-time buyers to borrow 125% of the value of their home. Yes, first-time buyers got 25% cashback on their mortgage!
In 2007, 9.5% of all mortgages were 95%, and 6.1% of mortgages were 100% to 125%.

Meaning that nearly 1 in 6 mortgages (15.6%) taken out in 2007
had a 95% to 125% mortgage.

When the value of a property goes below what is owed on the mortgage, this is called negative equity. A lot of Warrington homeowners with negative equity (or who were getting close to negative equity) in 2008 panicked because of the Credit Crunch and put their houses up for sale.

To give you an idea of what happened last year (2021) regarding mortgage lending, only 2.4% of mortgages were 95%, and 0.2% of mortgages were 100%. This is because the mortgage lending rules were tightened in 2014.

So why did Warrington house prices drop in 2008?

Well, in a nutshell, a lot more Warrington properties came onto the market at the same time in 2008, flooding the Warrington property market with properties to sell.

Meanwhile, mortgages became a lot harder to obtain (because it was the Credit Crunch), so we had reduced demand for Warrington property.

Prices drop when we have an oversupply and reduced demand for something. Warrington property prices fell by between 16% and 19% (depending on the property type) between January 2008 and May 2008.

So, what were the numbers of properties for sale in Warrington during the last housing market crash?

There were 990 properties for sale on the market in Warrington in the 
summer of 2007 (just before the crash), whilst a year later, when the 
Credit Crunch hit, that had jumped to 1,820.

This vast jump in supply and the reduction in demand caused Warrington house prices to drop in 2008.

Compared with today, there are only 186 properties for sale in Warrington, whilst the long-term 15-year average is between 750 and 770 properties for sale.

So, what is going to happen to the Warrington property market?

The Warrington house price explosion since we came out of Lockdown 1 has been caused by a shortage of Warrington homes for sale (as mentioned above) and increased demand from buyers (the opposite of 2008).

However, there are early signs the discrepancy of supply and demand for Warrington properties is starting to ease, yet this takes a while before it has any effect on the property market, so it will be some time before it takes effect.

This will mean buyer demand will ease off whilst the number of properties to buy (i.e. supply) increases. This should gradually bring the Warrington property market back in line with long-term levels, rather than the housing market crash.

My advice is to keep an eye on the number of properties for sale in Warrington at any one time and only start to worry if it goes beyond the long-term average mentioned above.

But before I go, I need to chat about what inflation and the cost of living will do to the Warrington property market.

How will inflation and cost of living affect the
Warrington Property Market?

There is no doubt that cost-of-living increases will have a dampening effect on buyer demand. If people have less money, they won’t be able to afford such high mortgages. This will slow Warrington house price growth, especially with Warrington first-time buyers.

Yet, the reduction in first-time buyers is being balanced out by an increase in buy-to-let landlord's buying, especially at the lower end of the market.

This, in turn, will stabilise the middle to upper Warrington property market. This means the values of such properties (mainly Warrington owner-occupiers) will see greater stability and a buyer for their home, should they wish to take the next step on the property ladder.

So why are more Warrington landlords looking to extend their
buy-to-let portfolios, even in these economic circumstances?

I see new and existing buy-to-let Warrington landlords come back into the market to add rental properties to their portfolios. As the competition with first-time buyers is not so great, they’re not being outbid as much.

Yet, more importantly, residential property is a good hedge against inflation.

Firstly, in the medium term, property values tend to keep up with inflation.

Secondly, inflation benefits both landlords and existing homeowners, with the effect of inflation on mortgage debt. As Warrington house prices rise over time, it reduces the loan to value percentage of your mortgage debt and increases your equity. When the landlord/homeowner comes to re-mortgage in the future, they will receive a lower interest rate.

Thirdly, as the equity in your Warrington property increases, your fixed-rate mortgage payments stay the same.

Finally, inflation also helps Warrington buy-to-let landlords. This is because rents tend to increase with inflation. So as rents go up, your fixed-rate buy-to-let mortgage payments stay the same, creating the prospect of more significant profit from your buy-to-let investment.

If you are looking for an agent that is well established, professional and communicative, whether you’re buying, selling or looking for an investment opportunity, then contact us to find out how we can get the best out of the Warrington property market.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235 338 – we are based on the Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Warrington Property News.

CLICK HERE TO FIND OUT HOW MUCH YOUR WARRINGTON HOME IS WORTH FOR FREE
Hamlet Homes Warrington, your local Estate Agent
Follow my Warrington Property Market Blog
Hamlet Homes Warrington LinkedIn Page
Hamlet Homes Estate Agents Warrington Facebook Page
Hamlet Homes Estate Agents Warrington Twitter Page

Friday, 13 May 2022

7 Safety Checks You Should Make When You Move Into Your New Home in Warrington


So you’ve moved home, you have the keys, you’re in, and the kettle and mugs have been unpacked. Sure, you’ve got boxes here, there and everywhere, but at least you’ve finally moved and are happy!

It’s time to start a new chapter in the house of your dreams. But, you don’t want the dream to turn sour, so we suggest that after making a cup of tea and getting settled in, you should do some standard safety checks.

Why? Because you need to ensure your home is safe and isn’t going to cause you any issues.

So, what should you be checking? Well, we’ve put together a list of seven safety checks you should make when you move into your new home.

1. Check the Windows and Doors

First things first, safety and security go hand in hand. Walk around your property and look at the windows and doors, noting whether they have safety catches on them or security locks. If they haven’t, put it on your urgent “to do” list. With your external doors, many new occupiers choose to change the locks as you never know where a spare key has gone in the past.

Top Tip: Write a list and work through it methodically – it’ll save you time in the long run!

2. Check the Water and Electrics

Now, this really is something you should do as soon as possible. Even if your property is brand-spanking-new, you need to know it is as safe as houses.
  • Look for the stop cock
  • Note where the fuse box is
Should you need to take action in an emergency, you should know where important things are located. You should also look at the plug sockets and wiring to make sure all is correct.

Top Tip: If any work needs doing, you may need to get a more competent, professional tradesperson to help you – particularly with the electrics.

3. Check the Appliances

Your new home may have appliances already in-situ. A washing machine, for example, or an oven. It saves you time and expense, of course, but you should check them over to ensure they are safe to use.

Top Tip: When you’re looking around a potential new home, you should always ask to see the appliances working if they are included.

4. Look Around the Garden

Look at those roses there, and that lovely fence, oh and that old tree in the corner. But wait. Is your new garden actually safe?
  • Are your little ones going to be able to toddle through the gate?
  • Will they know the dangers of the small pond?
  • Is that old tree safe, or should you get someone in to assess it and lop a few rotten branches off if necessary?
  • Are there gaps in hedges where your dog could escape?
Top Tip: Do a complete audit of the garden. It’s better to spend an hour checking everything than spending a lot longer having to deal with an emergency.

5. Is the House Childproof?

We don’t need to explain why child safety should be paramount. You should walk around the house to ensure everything is in place to help keep your children safe. This includes safety catches on cupboards, padlocks on areas where things like cleaning products are stored, locks on front and back doors and side gates and stairgates.

Top Tip: Little people are curious and will stick their fingers in everything! Most hardware stores carry home safety packs that include plug socket covers and cupboard catches. Keep a spare set so you are always prepared.

6. Check the Smoke Alarms

Safety is a priority, and alarms alert you to danger. Make sure there are working batteries in the smoke alarms and in the carbon monoxide alarm. If it is a wired-in smoke alarm, test it. Make sure your family know what they are for, what they sound like and what they should do if they hear them.

Top Tip: Test all your alarms monthly without fail.

7. Plan an Emergency Escape Route

You’ve done all the safety checks but, what happens if something goes wrong and you need to get out of your property? You should plan how you and your family will escape from the house in an emergency. You need to think about routes and who is responsible for whom, and where to meet up when you’re outside.

Top Tip: Having a plan can save you time, and in an emergency, time is of the essence. Make sure the whole family knows the plan and practice it if you need to.

Hamlet Homes Warrington are your local property experts for the Warrington area. Call us on 01925 235 338 or email manoj@hamletwarrington.co.uk to chat with a member of our friendly and experienced team.

If you are looking for an agent that is well established, professional and communicative, whether you’re buying, selling or looking for an investment opportunity, then contact us to find out how we can get the best out of the Warrington property market.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235 338 – we are based on the Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Warrington Property News.

CLICK HERE TO FIND OUT HOW MUCH YOUR WARRINGTON HOME IS WORTH FOR FREE
Hamlet Homes Warrington, your local Estate Agent
Follow my Warrington Property Market Blog
Hamlet Homes Warrington LinkedIn Page
Hamlet Homes Estate Agents Warrington Facebook Page
Hamlet Homes Estate Agents Warrington Twitter Page

Monday, 9 May 2022

Warrington Rental Homes Nightmare

  • Warrington needs 645 additional private rented properties per year to keep up with current and future demand from Warrington tenants.
  • Yet over the last 5 years, Warrington has lost 556 private rented homes.
  • What are the 5 reasons the supply of private rental properties in Warrington are falling? What does this mean for tenants and landlords in Warrington?
There has been a rise in demand for rental properties and an 8.9% fall in the number of Warrington private rented properties, which has caused Warrington rents to rise by 10.4% in the last year, a new all-time high.

The National Residential Landlords Association asked the respected economics think tank Capital Economics, to carry out research on the UK rental market. It found that if the current trends in the property market in terms of growth of the population, Brits living longer, the lack of new homes building, the reduction in social housing (aka council housing), then demand for homes in the private rented sector needs to increase by 227,000 homes per year.

So, based on those numbers, Warrington needs to have an additional 645 private rented properties per year.

The problem is the number of private rented properties in Warrington has reduced from 10,425 in 2017 to 9,869 in 2021, a net loss of 556.

So, why has supply of private rented homes in Warrington reduced?

Section 24 Income Tax

Section 24 was introduced in 2017 to level the playing field on the taxation of property between homeowners and landlords. Section 24 stops landlords from offsetting their buy-to-let mortgage costs against the profits from their rental property. Interestingly, no other kind of UK business is affected by the Section 24 taxation. In other words, whatever other form of business you might be in, be it butcher, baker or candlestick maker, every other business can offset their finance costs against their profits, except buy-to-let.

The issue caused by Section 24 Tax is that some landlords ended up paying more income tax than they really made in profit after paying their buy-to-let mortgages. Meaning on the back of rising Warrington house prices in the last five years, some Warrington landlords have sold their buy-to-let investments.

3% More Stamp Duty for Landlords

When someone buys a property, they normally must pay a tax to the Government for the privilege. This tax is called Stamp Duty. Yet landlords must pay an additional 3% stamp duty supplement on top of that when they purchase a Warrington buy-to-let property. Evidence suggests some Warrington landlords have decided to hold off or scale back buying additional buy-to-let properties for their portfolio because of the thousands of extra pounds that landlords have to pay to buy the rental property.

Holiday and AirBnb Lets

Some Warrington landlords are converting their long-term rental properties into short-term furnished holiday and AirBnB properties. Whilst the hassle, stress and service levels are much higher, these types of properties do tend to make more money and aren’t as heavily taxed as normal lets. When properties convert to short-term lets, it removes another Warrington property out of the general supply chain of long-term rental properties.

Greater Legislation for Rental Properties

With more than 150 pieces of legalisation, and new laws being added each year, the burden on landlords is huge. On the horizon is the Renters Reform Bill which will remove the no fault evictions. Also, all rental properties with an Energy Performance Certificate (EPC) rating of below a ‘C’ will have to be improved (i.e. money spent on them) by the landlord. This could be more than £10,000 per property. Hence, why some Warrington landlords have been selling their rental properties with low EPC ratings in the last 18 months.

Accidental Landlords Selling Up

There are some Warrington landlords who are classed as ‘Accidental Landlords’. In 2008/9, with a slowing property market and house price values dropping in the order of 16% to 19% (depending on the type of property) some Warrington homeowners decided to let their home out as opposed to selling it at a loss. Yet, with the price booms of the last 18 months, many decided to cash in on the higher property prices and sell - again taking another private rental property out of the system.


So, why is demand of private rented homes in Warrington 
increasing, even though more people own their home in 
Warrington than 5 years ago?

Even with better provision of affordable social housing and higher rates of owner occupation in Warrington (rising from 66.52% of homes in Warrington being owner occupied in 2017 to 68.96% in 2021), demand for private rental property continues to outstrip supply.

There are many reasons behind this including:
  1. People are living longer, meaning not so many properties are coming back into the mix to be recycled for the younger generation.
  2. Net migration to the UK has continued at just over a quarter of a million people a year since 2017, meaning we need an additional 115,000 households to house them alone.
  3. For the last two years, one in six of the owners of properties that have been sold have moved into rented accommodation instead of buying on because of the lack of properties to buy.
So, what is the outcome of the imbalance between supply and 
demand on Warrington rental properties?

Quite simply - Warrington rents have rocketed. They are 10.4% higher today than the spring of 2020 … and that’s on the back of rents being 6.9% higher in spring 2020, compared to spring of 2019.

The severe shortage of housing in the private rented sector is pushing up rents in Warrington as demand continues to grow. Many Warrington people are finding it hard work to find appropriate accommodation at a reasonable rent, and with mounting numbers of tenants predicted to continue, this situation will only get worse unless more houses are built.

My heart goes out to those Warrington tenants struggling with the cost-of-living crisis, only to then be hit by higher rents.

Yet, these higher rents are now enticing new landlords back into the Warrington buy-to-let market because of the higher returns.

With higher inflation, property investment has been seen in the past a safe harbour to invest one’s money in. With the bonus of rising yields (because of the increase in rents) together with the nervousness of the Bank of England to increase interest rates too much because of the issues in Eastern Europe, this could be the start of a second renaissance in the Warrington buy-to-let market.

If you have concerns about the issues in legislation and taxation, then the advantage of employing a letting agent, with the choice of property, what you pay for it and how it’s managed, will go a long way to mitigate them.

If you are considering getting into the Warrington buy-to-let market for the first time or expanding your property portfolio (whether you are a client of mine or not) please do not hesitate to give me a call and we can discuss these matters further.

If you are looking for an agent that is well established, professional and communicative, whether you’re buying, selling or looking for an investment opportunity, then contact us to find out how we can get the best out of the Warrington property market.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235 338 – we are based on the Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Warrington Property News.

CLICK HERE TO FIND OUT HOW MUCH YOUR WARRINGTON HOME IS WORTH FOR FREE
Hamlet Homes Warrington, your local Estate Agent
Follow my Warrington Property Market Blog
Hamlet Homes Warrington LinkedIn Page
Hamlet Homes Estate Agents Warrington Facebook Page
Hamlet Homes Estate Agents Warrington Twitter Page

Friday, 6 May 2022

How to Sell Your Warrington Home Fast This Spring


If you’re thinking about selling your home in Warrington this spring and want a quick sale, then here are our tips to help you find a buyer in no time at all.
  • Be Flexible on Price
When it comes to selling your property in Warrington, a good estate agent will be able to give you a clear idea of the price range that it falls into.

Ideally you’ll get the full asking price, and if you’re very lucky then you may be offered more if a couple of potential buyers want to compete.

However, if you want a quick sale then you may need to be prepared to accept a little under the asking price. You should be willing to be flexible, especially if the property is looking tired and some of the major components need updating, such as the boiler or windows.

Have an amount in mind that you would be willing to accept but don’t allow yourself to be forced into accepting a low offer if you won’t be happy with the price.
  • Find the Right Buyer
While it’s natural to want to achieve the highest possible price for your property, it may be worth sacrificing a small amount to get a sale completed as quickly as possible.

For example, one buyer may offer you the full asking price but be part of a long chain, whereas a first-time buyer may come in with a slightly lower offer but with no chain to consider.

So if you’re looking to sell in a hurry, then it may be worth your while choosing a buyer who’s ready to go quickly, even if it costs you a bit of money in the short-term.
  • Give Your Home a Lick of Paint
Buyers will be far more attracted to a property that’s ready to move into immediately, and you don’t need to spend a fortune getting the place ready either. A fresh coat of paint will do the job, even if it’s just a touch up rather than a full paint job.

Go for neutral colours too, such as an off-white or magnolia. Buyers want to imagine themselves living in the property they’re viewing, so giving them a blank canvas will be far more appealing than jungle-themed wallpaper for example!
  • Boost Kerb Appeal
Many buyers will make up their mind about a property before they’ve even stepped foot inside.

If you’ve allowed the front garden to become overgrown, or your overflowing wheelie bins are blocking the path then it’s time to get the gardening gloves on and tidy it up.

Add a hanging basket or two, or some pots, and perhaps touch up any paitwork if you want to really make an impression.
  • Show off your Home’s Assets
You want to show your property in its best light, so that means highlighting everything that’s good about it.

For example, you may have been using the second bedroom as a dumping ground for all your old coats or magazines, but buyers will want to see how they can use the space as a second bedroom.

So clear all the clutter out of sight, make the bed and let buyers see what it’s meant to be used for.
  • Declutter…Everywhere!
This ties in nicely with showing off your property’s assets. Buyers want to see a property that’s well looked after and don’t want to be overwhelmed with clutter when they walk through the door.

So if you have been using the understairs cupboard for junk or piling up paperwork in the sitting room then it’s time for a clearout. And there’s the added bonus of potentially making a few pounds by selling some of your unwanted possessions.
  • Fix any Minor Issues
When you’re living in a place it’s easy to overlook a missing lightbulb, a damaged fence or a cracked window.

However, if you’re looking to sell, then these minor issues are all things that buyers could pick up on, and which might put them off making an offer.

Some buyers may see minor issues like these as a sign of potentially bigger issues elsewhere, and it gives them the impression that the house isn’t well maintained generally.

So before you come to sell, just take some time to sort out those odd jobs that you’ve been putting off.
  • Clean Your House
You don’t need to get the professionals in or spend all day doing a deep clean, but before any viewings just make sure you’ve whizzed round with the vacuum and a duster, emptied the bins and tidied up.

You’d be amazed how much of a difference it can make to buyers, and it’s further proof that you take pride in your property and maintain it to a good standard.

Hamlet Homes Warrington are your local property experts for the Warrington area. Call us on 01925 235 338 or email manoj@hamletwarrington.co.uk to chat with a member of our friendly and experienced team.

If you are looking for an agent that is well established, professional and communicative, whether you’re buying, selling or looking for an investment opportunity, then contact us to find out how we can get the best out of the Warrington property market.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235 338 – we are based on the Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Warrington Property News.

CLICK HERE TO FIND OUT HOW MUCH YOUR WARRINGTON HOME IS WORTH FOR FREE
Hamlet Homes Warrington, your local Estate Agent
Follow my Warrington Property Market Blog
Hamlet Homes Warrington LinkedIn Page
Hamlet Homes Estate Agents Warrington Facebook Page
Hamlet Homes Estate Agents Warrington Twitter Page

Tuesday, 26 April 2022

Warrington Homeownership Rockets by 3,727 Homes in the Last 5 Years


  • The Warrington housing market over the last five years has behaved oddly.
  • Warrington house prices are 33.5% higher than in 2017, even though during those five years, the British economy had the uncertainty of Brexit and the massive fall in GDP during the pandemic.
  • Yet, a less observed trend is that the net number of homeowners in Warrington has risen by 3,727 households, a jump of 3.7%.
  • Why has growth in homeownership happened, and what does it mean for Warrington's existing homeowners (and landlords)?
With the newspapers full of news about the death of homeownership and the growth in Generation Rent, it must surprise many (as it did with me) that the number of homeowners in Warrington has grown.

To give some context …

the number of homeowners in Warrington dropped between 2011
and 2017 by 379 households, yet between 2017 and 2021, that
grew by 3,727 households.

So, what is behind this growth in homeownership and is it a good thing?

Politicians love it when homeownership rises, as they believe owning a house turns individuals into model upright citizens. It was one of the critical reasons for the council house sell-off in the 1980s.

Yet the hard data to back this up is unexpectedly slim, whilst other studies hint that homeownership has some harmful costs to the economy, such as reduced entrepreneurial spirit and the disinclination to move home to find work.

However, increasing homeownership may be a good foundation for Britain’s economic recovery after the last few years. Homeowners have a greater propensity to live in single-family unit homes like townhouses and semi-detached houses.

A greater demand for more single-use homes supports the construction of such dwellings (instead of other types such as small apartment blocks or Homes of Multiple Occupation). This is important because single-family unit homes tend to be better build quality, have more extensive gardens, and have more local amenities.

So, what are the sort of numbers I am talking about in Warrington?

In 2017, there were 48,544 Warrington owner-occupied homes.
By 2021, this had grown to 52,271 Warrington homes.

This means homeownership in Warrington has risen from 66.52%
of the households in Warrington in 2017 to 68.96% in 2021,
a proportional increase of 3.7%.

So, what is behind this growth in homeownership?
  1. 95% mortgages have been readily available at low-interest rates now for over a decade. In 2017, first-time buyers also got an exemption from stamp duty. This created a perfect storm of demand, which caused the number of Warrington first-time buyers to rise.
  2. Whilst the rise in homeownership in Warrington precedes the pandemic by a couple of years, another factor to the growth relates to the last property market recession of 2008/9 (the Credit Crunch). Between 2009 and 2012, many Warrington homeowners found themselves unemployed and still had to pay mortgages at 6% to 8%. Some homes were repossessed or some had to sell their home at a low price to unshackle themselves from their high mortgage costs. This development, nevertheless, took many agonising years to play out, reducing the homeownership until the middle of the last decade.
  3. People’s views on the way they live have altered during the lockdowns. In a sphere of stay-at-home instructions and social distancing, the peace of mind of homeownership gives Warrington homeowners the security of tenure.
  4. Finally, there has been a long-term change in the demographics of the UK. Millennials (currently aged between 26 and 41) are less likely to be homeowners than their Baby Boomer parents were at the same age. Yet, the British millennial generation is now entering its prime home-buying period as they have saved their deposit and are more likely to inherit money from their grandparents. (The average age of a first-time home-buyer in the UK is 33 compared to 26 in the mid-1990s).
So, the final question has to be …

how much further could homeownership go in Warrington?

The biggest hurdle could prove to be the supply of available homes.

Many 'accidental landlords' have been selling their properties recently, which first-time buyers have bought. Accidental landlords put their own homes up for rent in the early to mid-2010’s because they could not sell. Now they have been motivated to cash in on the higher Warrington house prices in the last couple of years, which increased the supply of properties to buy for owner-occupation.

Also, the number of houses on the market in Warrington available to buy from existing owner-occupiers is starting to grow (up from 355,700 in December 2021 to 431,000 in March 2022). This is giving greater confidence to other Warrington homeowners too scared to put their homes up for sale because they are concerned they would not be able to find anything. Things are starting to change in that regard.

Also, there are signs of a recovery in British new home building as the number of new housing starts in 2021 hit the highest level since the financial crisis of 2007. Yet with a steady increase in Warrington landlords returning to the market in the last few months, this tide will turn.

Warrington’s homeownership could continue to swell for a while yet!

P.S. What does this mean to the private rented sector in Warrington? Come back next week as I give some fantastic insights every Warrington landlord will want to read to ensure they remain profitable in the Warrington buy-to-let market.

If you are looking for an agent that is well established, professional and communicative, whether you’re buying, selling or looking for an investment opportunity, then contact us to find out how we can get the best out of the Warrington property market.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235 338 – we are based on the Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Warrington Property News.

CLICK HERE TO FIND OUT HOW MUCH YOUR WARRINGTON HOME IS WORTH FOR FREE
Hamlet Homes Warrington, your local Estate Agent
Follow my Warrington Property Market Blog
Hamlet Homes Warrington LinkedIn Page
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Hamlet Homes Estate Agents Warrington Twitter Page

Tuesday, 19 April 2022

17,979 Warrington Terraced Houses Why are they so popular?


The terraced house is one of the most familiar styles of home in Warrington (and the UK as a whole).

25.5% of Warrington people live in a terraced home, interesting 
when compared with the national average of 22.7%.

So, what is it about the humble terraced/townhouse us Brits love so much? In this article, I look at the history of the terraced house, how it relates to Warrington and what the future holds for terraced homes.

A terraced house is a property built as part of a continuous row of three (or more) properties in a similar and uniform style.

The reason the British call them 'terraced houses' and not 'row houses' came about because 18th century British architects borrowed the phrase 'terrace' from 'terraced gardens’. Terraced gardens were known for their uniform nature (in looks, style and height etc.), so the architects decided to name them the same way as opposed to a ‘row house'. In fact, in most countries, they are called 'row houses'.

The terraced house originated in the Low Countries of Europe
in the late 1500s.

Terraced houses were first built en-masse in the UK after the Great Fire of 1666 with the rebuilding of London.

They became fashionable for the landed gentry in the early Georgian era with chic and stylish terraces appearing in London's Mayfair and Bath with its Queen Square (the forerunner of the famous Royal Crescent) and were sometimes built around a garden square.

However, it wasn’t until the early 1800s that the terraced house turned out to be the solution to the increasing population of the towns as more and more people were attracted to towns and cities for work.

The terraced house fell out of favour with the upper-middle classes in the late Victorian age (1870’s onwards) as they wanted more privacy and space. They moved to live in detached houses or semi-detached villas, as the terrace house had started to become associated with the lower-middle and working classes.

With all these terraced houses being built, their quality of construction and design dropped as builders tried to squeeze more profit. The biggest issue was that most of the terraced houses built in the early to mid-Victorian age (1840s to 1870s) were made back-to-back with no rear garden, causing unsanitary conditions. Therefore, the Public Health Act of 1875 was introduced to regulate the building of terraced houses with design and standards.

These new building standards in the Act improved the terraced house’s ventilation and, more importantly, required the house to have a toilet (frequently built outside). To meet these new building standards, the designs of these new houses created the well-known landscape of ‘grid' streets lined with two-storey terraces serviced by a pedestrian path between them, the name of which is a hotly debated topic. The various names for the pathway include alleyway/jitty/cut/ginnel/snicket/passageway/ten foot/five foot witchel/ lonnin/vennel.

As a Warrington resident, why not say what you call them in the comments.

As we entered the 20th Century, the terrace house continued to
be popular, albeit with some new architectural additions.

The advent of Arts and Craft architecture with stain glass windows, Tudor style cladding, ornate porches, and elaborate chimney stacks.

After the First World War and the introduction of the Housing and Town Planning Act 1919 (which made local councils build council houses), the Victorian terraced rapidly became associated with overcrowding and slums (especially those back-to-back terraced houses built before 1875). Many of the back-to-back terraced houses were knocked down between 1930 and 1960 in what is known as the slum clearances.

Private builders started building the iconic suburban semi-detached houses with more extensive gardens, and local authorities decided to build high-rise blocks after World War II. Yet after the partial collapse of Ronan Point in 1968, the popularity of high-rise tower blocks waned.

Since the early 1990s though, the terraced house has steadily
come back into favour as building land prices have increased
by 322% in the last 30 years.

Many private builders have started to build modern three-storey townhouses in rows of five to seven. This terraced 'townhouse-style' allows three and four bedrooms on a land footprint that would have usually only accommodated a smaller two-bed property.

So, let's look at some interesting stats on Warrington terraced houses.
  • There are 17,979 terraced houses in Warrington (broken down as 10,788 privately owned terraced houses, 4,151 terraced council houses and 3,040 in the private rented sector)
  • 16.9% of terraced houses in Warrington are in the private rented sector, which is below the national average of 19.1%
  • The most expensive terraced house in Warrington ever sold was on Eagle Brow, Lymm, Warrington for £850,000 in 2017
  • The cheapest Warrington terraced house sold in the last two years was on Blackcap Walk, Birchwood, a four-bed terraced house for £54,000
  • Terraced houses in Warrington sell for an average of £158 per square foot
I hope you found that thought-provoking?

So, why is the terraced house, be it a red brick Victorian house or a more modern three-storey townhouse, still popular today in Warrington?

They are typically well built, cheaper to maintain (especially the older terraced houses), comparatively spacious, and in good locations. Many terraced houses have been improved and extended through the inventive use of rear gardens/yards and converted roof spaces; their unpretentious design remains adaptable enough for 21st century living; what isn't there to like about them?

These are my thoughts; tell me your thoughts about the humble yet versatile Warrington terraced house.

If you are looking for an agent that is well established, professional and communicative, whether you’re buying, selling or looking for an investment opportunity, then contact us to find out how we can get the best out of the Warrington property market.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235 338 – we are based on the Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Warrington Property News.

CLICK HERE TO FIND OUT HOW MUCH YOUR WARRINGTON HOME IS WORTH FOR FREE
Hamlet Homes Warrington, your local Estate Agent
Follow my Warrington Property Market Blog
Hamlet Homes Warrington LinkedIn Page
Hamlet Homes Estate Agents Warrington Facebook Page
Hamlet Homes Estate Agents Warrington Twitter Page

Monday, 11 April 2022

75% Drop in Warrington Council Houses in the Last 40 years


  • In 1981, 28.6% of properties in Warrington (and the Warrington Borough as a whole) were council houses. Today, that figure stands at 7.2%, a proportional drop of 75%.
  • Why has the number of council houses dropped so much in those 40 years?
  • How has that changed the dynamics of the Warrington property market in those 40 years?
The ability of local authorities to build council houses came into law in July 1919 with the 1919 Housing and Town Planning Act. It was one of the most important pieces of domestic legislature passed after WW1 and was the first time in the UK that a nationally public funded system of providing homes was made for the masses. It was paid for mostly by central government and provided by local authorities (councils) and public utility societies (which in later years became today’s housing associations).

Between 1919 and 1979, 6.94 million council houses were built.

Just over 1 million council houses were built between 1920 and 1939, whilst 5,804,150 council houses were built between 1946 and 1979. This is compared to 4,533,440 private homes and 260,910 housing association properties in the same time frame (’46 to ’79).

So, between 1946 and 1979, the council house was the dominate force of British housing. But that all changed in 1979!

Many people believe it was Margaret Thatcher who was the architect of allowing the sitting tenant of a council house to buy their home. Interestingly, council house tenants have been able to buy their council house from as early as the mid-1930s, albeit with little or no discount. Also, as late as 1977, the Labour Housing Minster published a Green Paper extolling the virtues of homeownership and council tenants being able to buy their home at a discount.

But after the General Election of 1979, the new Tory government drafted the Housing Act 1980, which gave the Right to Buy, which became law in the autumn of 1980. Then things really took off!

This new law established a right for most council tenants who had been in their home for three years or more to a discount. The discount started at 33% and increased by 1% for each extra year, up to a maximum of 50%. If the tenant sold the house within the first five years of ownership, a prorated repayment of their discount was required.

Between 1980 and 1989, 970,558 council houses
nationally were sold at a discount.

Yet the issue was, when a council house was sold, it took that house out of the council’s portfolio for future generations. From the start, there were limitations on local authorities’ use of monies from the council house sales as most of it had to be given to central government in London, meaning only 390,560 new council houses were built between 1980 and 1989. Looking at the numbers locally …

In 1981, there were 16,746 council houses
in Warrington today it’s 6,147.

No wonder the country has a housing crisis ... yet as my regular readers know - the devil is in the detail … and that devil is the humble housing association.

The Tory General Election Manifesto in 1979 had proposed the rights for both council house and housing association tenants to buy their own house under the Right to Buy scheme. The Conservatives argued housing associations, who obtained government funding, should be subject to the same Right to Buy proposals as councils. The Government won the vote in the Commons, yet lost the vote in the Lords, meaning housing association tenants could not buy their homes at a large discount.

At the time, there were only 400,000 housing association properties in the country, so the Government were not that worried. But the significance of housing associations developed in the 1980s and beyond as they were allowed to borrow money from the private sector.

Between 1949 and 1979, the average number of housing association properties built annually was 8,524. Since 1979 to today, it has been 25,062 per year (and 31,606 per year in the 2010s).

Also, the Government encouraged councils to transfer their remaining council houses to housing association schemes from 1986. The advantage to these ‘stock transfers’ was the Government allowed housing associations to access private funding to improve their existing properties and buy new ones (good news for existing tenants complaining that the local authority never upgraded their homes).

Moreover, the Tory Government liked stock transfers, as it allowed them to dismantle council housing from the inside. Interestingly, Labour expanded the ‘Stock Transfer’ process in 1997 and further reduced the eligibility for council tenants’ Right to Buy, meaning the number of council tenants exercising their Right to Buy declined considerably.

Meaning today, even though the provision of council housing has dropped like the proverbial stone …

the number of housing association properties in Warrington has 
increased from 744 in 1981 to 7,171.

So, how has this changed the dynamic of the Warrington property market in the last 40 years?

Would it surprise you to learn that the number of people who own their Warrington home today is very similar to what it was 20 years ago before the property boom started? It’s just that even though we’ve had a large drop in the number of council houses and an increase in the number of housing association properties, the number of people owning their home has remained relatively the same (in some areas of Warrington this has actually increased), the significant issue is the growth of the private rented sector in Warrington.

It's almost as if people who used to rent from the council now rent
from a private landlord.

The question is, is it right for private individuals to make money from tenants who rent from them as opposed to the local authority? Or are private landlords providing better types, choices and quality of accommodation for these tenants, albeit at a higher rental rate than if they rented a council house?

I really do believe if it wasn’t for the growth of the buy-to-let landlord, which began in the early 2000s, we would have an even bigger housing crisis on our hands than the one we have currently.

Both local and central government have had their hands tied behind their backs since 2008 with a lack of funding, and it’s the humble private landlord who has stepped up and supplied in excess of 2.3million additional rental properties since 2001, housing nearly 5,520,000 Brits. These landlords have saved the day since the big council house sell off in the 1980s!

What are your thoughts on this matter?

If you are looking for an agent that is well established, professional and communicative, whether you’re buying, selling or looking for an investment opportunity, then contact us to find out how we can get the best out of the Warrington property market.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235 338 – we are based on the Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Warrington Property News.

CLICK HERE TO FIND OUT HOW MUCH YOUR WARRINGTON HOME IS WORTH FOR FREE
Hamlet Homes Warrington, your local Estate Agent
Follow my Warrington Property Market Blog
Hamlet Homes Warrington LinkedIn Page
Hamlet Homes Estate Agents Warrington Facebook Page
Hamlet Homes Estate Agents Warrington Twitter Page