Warrington Property Blog: May 2017

Thursday, 25 May 2017

Warrington Flats Out-Perform Property Market Average by 33%

According to the Land Registry's latest House Price Index for Warrington and the surrounding locality, the value of apartments/flats are rising at a faster rate than terraced/town houses, semi-detached properties and even detached property.

The values of apartments in Warrington have increased by 10.14% over the past year, which is 33% more than the average rise in Warrington of 7.65%. The last time flats/apartments in Warrington out-performed all the other types of property by such a gulf, was back in the spring of 2003.

How do other types of property compare?

For comparison, the other property types performed as follows:

· Detached homes rose by 8.2%

· Semi-detached homes rose by 7.24%

· Terraced/Town-Houses rose by 6.8%

This moderately increasing rate of property value growth is opportune – but no one should confuse it with a strong and vigorous healthy Warrington property market. Instead, it is somewhat an indicator of the long-lasting lack of property on the market. In fact, I have spoken about the lack of homes for sale in Warrington on a number of occasions in my Warrington Property Blog and whilst it isn’t as bad as it was 12 months ago, choice is quite limited for buyers.

The average property value in Warrington now stands at £201,200.

When split down into property types:

· Warrington Apartments at £125,300

· Warrington Detached Homes at £320,800

· Warrington Semi-Detached Homes at £176,100

· Warrington Terraced/Town-Houses at £126,500

Is it just a Warrington thing?

So why have Warrington apartments performed so well? Is it just a Warrington thing?

When I scrutinised the figures for the rest of the UK, it appears that apartments are pacemakers in the clear majority of the country. Of the 379 local authority areas in the UK, the value of apartments is rising faster than detached, semi-detached and terraced houses in 320 of them.

So, should Warrington apartment owners be getting out the champagne? Well, I would keep it on ice as the Land Registry figures are notorious for short term fluctuations. It’s hard to have faith in the fact that Warrington house values rose rapidly last month given that, in the last six months, the Land Registry has frequently made downward revisions to their first published House Price Index figures.

Thankfully, the bigger picture from the Council of Mortgage Lenders (CML) stated that home buying activity last month was up 2% over the same month in 2016. That’s not bad as we have had autumn, winter and now spring since Brexit. The CML stated first time buyer’s levels of affordability was being squeezed and that the average amount borrowed by those first-time buyers dropped slightly last month, but the overall amount borrowed (by all buyers) was an impressive 12% higher than the same month in 2016.

So, what next for the Warrington Property market?

I believe the uplift in the values of apartments is a short-term blip. The real issue is with the way wage growth might not keep up with inflation as the effects of 2016 exchange rate sucks in inflation (meaning real wage growth stagnates). This will mean buyer demand growth will be curtailed and with property values already so full, I believe a renewed hastening in house price growth is unlikely.

I believe we are starting to return to the housing market we saw in the mid 1990’s, Steady demand, steady supply – nothing silly when it comes to house price growth. Therefore, I believe, with what is happening around us – this isn’t a bad thing at all.

HMS Warrington Property Market, “Nice and steady as she goes”, says the Captain.

You can always keep an eye on my blog for any properties I feel will make a good buy to let opportunity, or if you are after a second opinion then email over the property details or pop into my office for a chat, or even find out how we can get the best out of your investment property.

Email me on manoj@hamletwarrington.co.uk or call on 01925 235338. If you are in the area, feel free to pop into the office – we are based on 6 Bankside, Crosfield St, WA1 1UP. 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.

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Thursday, 18 May 2017

Should you be buying your next investment property in Warrington?

About two years ago, I wrote an article comparing Warrington, Widnes and Runcorn’s property markets to see which town’s property market would give an investor the best return on their investment. If you remember reading that article, I looked at the average property prices and the average rents in each town.

Two years ago, the research showed that Warrington was the safest of the three towns showing a yield of 5.7%, compared with Widnes’ of 4.5% and Runcorn’s 5.1%.

I thought I would re-visit my old research and see what changes have happened over the last two years. Although I compared Warrington against Widnes and Runcorn, today I will just be looking at Warrington and Runcorn (two bedroom terraced houses in particular).

How do the two towns stack up?

I decided to look at two bedroom terraced houses is because this is the most popular rental property in Warrington – this two up two down property investment strategy has been a strategy that has lasted the test of time. Providing you purchase at the right price and do your due diligence (or ask us to do it for you) you cannot go far wrong.

The average two bedroom terraced house in Runcorn comes in at £87,881 with an average rent of £501pcm, giving you a very strong yield of 6.8%.

Let’s take a look at Warrington. The average two bedroom terraced house In Warrington is £94,380 with an average rent of £560, giving us an even stronger yield of 7.1%.

It still goes to show, our town of Warrington is a good and safe place to invest in property. As always, this is a decision that you should not take lightly – both towns have their merits. These are only averages, so if you buy wisely and are in a position to move quickly, you could pick yourself up a property producing yields of 8%+ in either town.

As I always say, the trick is knowing WHAT and WHERE to buy – or even more important, what NOT to buy!

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

Thursday, 11 May 2017

Ask Andy - My Landlord Won't Issue Another Tenancy!!

''Dear Andy,

I have a twelve month tenancy agreement and my landlord had said she won't issue a new one, it runs out in three weeks. Is she right that my old tenancy will continue as it is? Please advise, I don't want to leave.

Thanks,

Pete.”

Andy’s Answer:

Hi Pete,

All assured shorthold tenancies automatically become periodic at the end of the fixed term period, as long as the tenant(s) continue to live in the property, so you needn’t worry about leaving unless you want to give notice and move.

Should the landlord create another fixed term tenancy, this may give you more peace of mind. A renewal ties you in for another six, twelve, etc months (as stated in the tenancy).

What are the disadvantages of renewing tenancies?

About two years ago I renewed a tenancy for a tenant after speaking to the landlord. It’s worth mentioning that this tenant wanted the security of having the property for at least another 12 months.

Three months into the renewal I received an email from the tenant – to cut a long story short, his mother became unwell and needed constant care back home. This would mean he would no longer need the property. Unfortunately, he was now liable for the full 12 months.

Now the tenant had a few options: he could pay the full 12 months and leave the property, or we as the agent would find a new tenant – however, all costs would be charged to this current tenant and rent would still need to be paid until a suitable tenant was found (the landlord can not incur any more costs).

If this tenant did not request to be tied in for another 12 months, all they would have needed to do is given one months notice.

Now, if the landlord wanted the property back for whatever reason he/she cannot issue a Section 21 Notice (two month’s notice) to get their property back until after the fourth month of a six month fixed term tenancy, or the tenth month in a twelve month fixed term tenancy.

So I really see no major advantage of renewing a tenancy.

At Hamlet Homes I advise all my tenants and landlords to allow the AST to roll into periodic once the fixed term comes to an end.

Some agents will do renewals of tenancies (but that’s only because they charge a renewal fee).

I hope I have put your fears to bed.

If you are a tenant and have a question, feel free to drop me an email or give me a call, my details are at the bottom of this article.

Landlords, if you are looking for an agent that is well established, professional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on andy@hamletwarrington.co.uk or call on 01925 235338. If you are in the area, feel free to pop into the office – we are based on 6 Bankside, Crosfield St, WA1 1UP. 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.

Thursday, 4 May 2017

Baby Boom Causes Warrington Property Shortage

As more babies are being born to Warrington mothers, this increase will continue to add pressure to the over-stretched Warrington property market – and materially affect the local property market in the years to come.

On the back of eight years of ever incremental increasing birth rates, a significant 4.06 babies were born for every new home that was built in the Warrington area in 2016.

I believe this has and will continue to exacerbate the Warrington housing shortage. This means demand for housing (be it to buy or rent) has remained high. The high birth rate has meant Warrington rents and property prices have remained resilient and they will continue to remain high in the years to come – even with the challenges the economy has felt over the last eight years.

Increasing Birthing Rates

This ratio of births to new homes has reached one its highest levels since 1945.

Back in the early 1970s, the average was only one and a half births for every household built.

· The latest figures show the Warrington area had an average of 62.7 births per 1,000 women aged 15 to 44.

· Interestingly, the national average is 61.7 births per 1,000 women aged 15 to 44.

The number of births from Warrington women between the ages of 20 to 29 is close to the national average, but those between 35 and 44 were slightly lower. Overall, the birth rate is still increasing. When that fact is combined with the ever-increasing life expectancy in the Warrington area, the high levels of net migration into the area over the last 14 years and the higher predominance of single person households…

This can only mean one thing: a huge increase in the need for more housing in Warrington.

Demand VS Supply

More and more tenants are having children because they feel safe in rented accommodation. Renting is becoming a choice for Warrington people.

The planners and politicians of our local authority, central Government and people as a whole need to recognise that with individuals living longer, people having more children... demand for property is simply outstripping supply. Whilst divorce rates have dropped recently, they are still at a relatively high level (meaning one household becomes two households).

The simple fact is: more Warrington properties need to be built.

Green Belt Land

Only 1.1% of the Country is built on by houses. Now I am not suggesting we build tower blocks in the middle of the Cotswolds, but the obsession of not building on any green belt land should be carefully re-considered.

Yes, we need to build on brown field sites first, but there aren’t hundreds of acres of brown field sites in Warrington. What’s more, what brown field sites there are, building on them can only work with complementary public investment. Many such sites are contaminated and aren’t financially viable to develop, so unless the Government put their hand in their pocket, they will never be built on.

I am not saying we should crudely go ‘hell for leather’ building on our Green Belt, but we need a new approach to enable some parts of the countryside to be regarded more positively by local authorities, politicians and communities and allow considered and empathetic development.

Society in the UK needs to look at the green belts outside their leisure and visual appeal, and assess how they can help to shape the way we live in the most even-handed way.

Interesting times!

If you would like more information about the Warrington property market, email me on manoj@hamletwarrington.co.uk or call on 01925 235338. If you are in the area, feel free to pop into the office – we are based on 6 Bankside, Crosfield St, WA1 1UP. 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.

About Me

I have been in the Warrington property market since 2004, owning and running, the Hamlet Homes office in Warrington with my excellent team.

I have always shared my thoughts on the local property market in Warrington with my landlords, but now I want to share with everyone with an interest in property in Warrington.

In my blog, I will talk about what is happening in the Warrington property market itself, even looking at specific streets or housing estates. At other times, I will post what I consider decent buy to let deals. I like to look at the whole of market and give you, what I consider to be, the best buy opportunities.

If you see a potential deal, and want a second opinion, email the link to manoj@hamletwarrington.co.uk and I will always give you my honest opinion on the property and its investment potential – good or bad.