Thursday, 8 November 2018

Warrington House Prices vs Warrington Rents since 2006




The Warrington housing market is a fascinating beast and has been particularly interesting since the Credit Crunch of 2008/9 with the subsequent property market crash. There is currently some talk of a ‘property bubble’ nationally as Brexit seems to be the ‘go-to’ excuse for every issue in the Country. Upon saying that, looking at both what we do as an agent, and chatting with my fellow property professionals in Warrington, the market has certainly changed for both buyers and sellers alike (be they Warrington buy to let landlords, Warrington first time buyers or Warrington owner occupiers looking to make the move up the Warrington property ladder).

Warrington house values are 4.25% higher than a year ago, and the rents Warrington tenants have to pay are 1.1% higher than a year ago

When we compare little old Warrington to the national picture, national property values have risen by 0.4% compared to last month and risen by 3.0% compared to a year ago, and this will surprise you even more, as nationally, property values are 19.8% higher than January 2015 (compared to 11.4% higher in the EU in the same time frame).

However, if we look further back...

Since 2006, Warrington house values are 23.24% higher, yet the rents Warrington tenants have had to pay for their Warrington rental property are 14.9% higher

...which sounds a lot, yet UK inflation in those 12 years has been 42%, meaning Warrington tenants are 27.1% better off in ‘real spending power terms’.

Looking at the graph, the rental changes have been much gentler than the roller coaster ride of property values. I particularly want to bring to your attention the dip in Warrington house values (in red) in the years of 2008 and 2009 ... yet as Warrington property values started to rise after the summer of 2009, see how Warrington rents dipped 6/12 months later (the yellow bars)…. Fascinating!



So, we have a win for tenants and a win for the homeowners, as they are also happy due to the increase in the value of their Warrington property.

However, maybe an even more interesting point is for the long-term Warrington buy to let landlords. The performance of Warrington rental income vs Warrington house values has seen the resultant yields drop over time (if house prices rise quicker than rents – yields drop).

Whilst, it’s true Warrington landlords have benefited from decent capital growth over the last decade –with the new tax rules for landlords – now more than ever, it’s so important to maximise one’s yields to ensure the long term health of your Warrington buy to let portfolio. More and more I am sitting down with both Warrington landlords of mine and landlords of other agents who might not be trained in these skills - to carry out an MOT style check on their Warrington portfolio, to ensure your investment will meet your future needs of capital growth and income. If you don’t want to miss out on such a MOT check up, drop me a line – what have you got to lose? 30 minutes of time against peace of mind - the choice is yours.

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 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 G5, Warrington Business Park, Long Lane, WA2 8TX. There is plenty of free parking and the kettle is always on.