I have always been of the opinion that the market in London is quite different to the rest of the country. More resilient, driven with an unquenchable thirst for bricks and mortar from first time buyers and naturally a place where people live for convenience of travel. It's no wonder that new developments on the outskirts of Glasgow are still advertised with "only xxx minutes to London by train." Everybody measures that distance when moving out. When you factor in the 17 changes, potential for train delays and the tube trip, bus ride, and 20 minute march to one's office those times certainly add up. Decision made, let's stay in London for a bit longer.
Location, location, location, it must be London then. This explains (partially at least) why the London property market is so strong. A vast factory always seeking worker bees - London offers a wide range of jobs for all levels. It's normal to work long hours, so cutting down the commute at the end of the day seems sensible. Bear this in mind of course when looking for your next investment.
The media seems to want to admit that the scaremongering of late is just that. The market is strong, and my thoughts are confirmed by this article from the Independent.
Their thoughts of late mirror mine when it comes to other factors as well, such as first time buyers. The article confirms that figures show a 17% rise in first time buyers completing on mortgages vs this time last year. Good news if you are developing properties for that market. I have spoken to several clients over the past month and said that the home mover market is rather slow (£750,000 - £1,500,000) which again the article confirms - the FTB completions outperformed this segment for the third month running.
Rents have been fairly stable at the moment due to a slight surge in supply - this is caused by accidental landlords selling up. Increasing regulation and taxation has pushed a few BTL properties on the sales market and a lot of these were snapped up in March to beat the April tax hike in stamp duty (a whopping 3% surcharge), but as summer is here the spike in demand is causing the usual (annual) peak in prices. Rents are up by 5.2% according to ARLA, but I predict that over the next few years (in London) we'll see much stronger increases once landlords start paying their tax bills and realising their costs have gone up by more than anticipated.
All in all the market is dependent on confidence - and this certainly exists. The Brexit vote was relatively evenly split (although of course a small majority for exit overall) so we must not forget that a lot of people that voted feel that the UK is better off outside the EU. Although there may not have been a majority who thought so in the South, you will see it's business as usual when you look at the price growth overall - over 5% this year.
Money is as cheap as it will ever be with the Bank of England base rate at 0.25% - hints have even been made that it will drop to 0.1%. All good signs really. Time to invest your time to research and your money in bricks and mortar!
If you are looking to make an investment decision then do get in touch and start a conversation. I have years of experience building portfolios for clients and can help you too. Having secured 4 properties this year, two of which are completed, I have a proven track record of investing other people's money as well as my own. You can also come along and meet me in person at the Clapham Property Meet on Wednesday 28th September. Do book a ticket promptly though as places are limited. We are having a social evening of networking along with quality content from my colleague Trevor Cutmore, guest speaker Mike Frisby (specialist in multi-lets and serviced accommodation) and of course me. You can book tickets at www.claphampropertymeet.co.uk.
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