Melton Mowbray House prices outperform the National Average in 2016

This week we have seen reports in the media surrounding house prices.   The Office for National Statistics has just released data collected from December 2016.

They have produced a comparison of the monthly inflation of house prices, calculated using data from Land Registry, for all areas across the UK.  The National average price of a property has risen by 7.2% during 2016.

Part of the report lists the top 5 UK Local Authorities to see the largest percentage annual growth in house prices in the year to December 2016.   

I was pleased to see Rutland made the 5^th spot!  The house price index revealed Rutland had seen 16.2% growth in house prices in the year to December 2016.

I had a closer look at the Melton Local Authority and came up with some interesting results.

Melton Local Authority had seen an increase of 2% higher than the national average - the average price of a property sold during the year to December 2016 had risen by 9.23% according to the ONS results.

The report had broken the increases down even further by each property type:

Detached houses 9.87% increase

Semi detached 9.77% increase

Terraced house 7.48% increase

Flat/maisonette 8.98% increase

Remember these figures are on sold prices as recorded at Land Registry not the advertised asking prices.   These results are very encouraging to see for anyone who already has an investment in property or who is considering becoming a Landlord.

Buying the right type of property is always going to be very important though – it needs to have minimal void periods as well as seeing some capital growth. 

Eagles Drive investment opportunity £117,000

Anthony Hancock are selling this 2 bed semi with off road parking for £117,000. We are now getting £525 pcm for similar properties on this estate which could see a potential return of 5.3%.

This property looks to be in good condition and with the added benefit of the parking it would let quickly. 

http://www.rightmove.co.uk/property-for-sale/property-64695425.html

Investment Gem in Asfordby £135,000 - 5.3% yield

This is a great 3 bed (check the floor plan) and it has a garage. We would easily let this for £600 pcm which would give a potential return of 5.3%. Benton's have just listed it for £135,000 and Asfordby appeals to tenants travelling to Leicester and Nottingham for work. 

Definitely one of the best potential investments I have seen for a while...


http://www.rightmove.co.uk/property-for-sale/property-58166677.html



  

Mortgages - Interest Only or Repayment?

I had a landlord visit me last week in my office on Burton Street interested in purchasing a property on Eagles Drive.    We had an interesting discussion about the best way to borrow funds for a property investment.

She had £50,000 for use as a deposit on a 3 bed semi with a purchase price of £140,000.  She had set aside the £4,500 for the stamp duty and solicitor’s fees and was planning to secure a mortgage for the remaining £90,000.  The property should see a rental income of £650 pcm

An independent mortgage broker had searched the market and come up with a few options - one of which came with no lender arrangement fee, 2 year fixed rate 2.39% and worked out at:

25 Year repayment mortgage would be £398 per month, Interest only mortgage £179 per month.

She wondered which would be the best type of mortgage to go for.   My preference would be to say a repayment mortgage but you have to consider an individual’s circumstance and exactly how they would like their investment to perform.

In her case she was looking for an income from her inheritance, already in early retirement she never planned to own the property.   So an interest only mortgage would suit her for the next 10 years of property rental.   This would maximise the monthly income she would receive until she sold.

With an interest only mortgage she would need to repay the mortgage when she sold it.  If property prices have remained the same over 10 years then she would be able to repay the original sum borrowed and retrieve the cash invested.

There is a risk that house prices may fall over that time and the value it is sold for will not cover the mortgage.

The history of sale prices is readily available on the Land Registry site or Rightmove and Zoopla websites so it is possible to track how these have performed over many years.

By discussing your options and researching your local market you are more likely to get the type of returns you are looking for.

When planning any investment it is important to understand tax liabilities that may be due when you come to sell the property.   We advise anyone looking to invest to seek independent financial advice.   

Figures supplied by Thomas Nicholas Financial Services in Melton Mowbray 8^th Feb 2017.

Baldocks Lane Investment potential

This 3 bed is on Baldocks Lane and is the type of property that would easily let for £650 pcm and looks to be in good condition. 

It is being marketed by Newton Falowell for sale at £ 164,950 and is the type of property that is in high demand by tenants in Melton Mowbray.


http://www.rightmove.co.uk/property-for-sale/property-58109689.html

Was it really harder to find a Buy to Let Investment in Melton Mowbray in 2016?

Many investment landlords tell me it is harder to find the right type of property to invest in these days.  It seems there are fewer suitable properties on the market for sale.  

I thought I would have a look at the Rightmove stats and see if there was any evidence to support this. I started by looking at what happened to the properties being marketed for sale in the LE13 area in 2015 vs 2016.

From the figures available it looks as though there has been a 15% decrease in the average numbers of properties being marketed for sale each month during 2016 when compared to 2015.

There has also been a decrease in the numbers of sold properties each month for the same area. These have decreased by around 36 % in 2016. The average number of properties sold sits just over 30 each month where it was nearly 50 per month in 2015.

The figures seem to suggest there were less properties coming onto the market in 2016 but also fewer properties actually selling. I wonder if it has something to do with the perception of the vendors that as there are fewer properties on the market they can achieve a higher price for their property?

In my opinion this does make it harder for investors to find the right property and for them to get a deal which will achieve the return they are hoping for.  As the demand from tenants is only increasing in Melton Mowbray let’s hope 2017 has more property coming onto the market for sale.

If you are considering investing in property please follow my blog.

Lovely 3 bed on Blyth Avenue - potential 5% return on investment

This is a lovely 3 bed family home that would definitely attract long term tenants. It is on the market with the online agent Ewemove for £157,250 and looks to be in really good order. 

I would expect to let this for £650 pcm which should give a potential return of 5% depending on the negotiated purchase price!

http://www.rightmove.co.uk/property-for-sale/property-46734198.html

Hope for a Better Rental Market in 2017

Despite government changes and fresh challenges in the ‘buy-to-let’ market, the future for rented property will continue to be one of the best bets for the country’s growing number of tenants as well as landlords.

Although the market is likely to be slowed down by the threat of stricter ‘buy-to-let’ rules - including tougher affordability checks for buy to let mortgages and the withdrawal of tax relief on mortgage interest – we are still reporting an increase in demand for houses to rent.

If you are a cash investor, or perhaps an ‘accidental landlord’ who has inherited a property with no mortgage repayments, you can expect a very healthy return on your investment – far better than you could achieve from mainstream savings products.  

A priority in 2017 will be to carry on sourcing more local, good quality rental accommodation to satisfy both landlord and tenant client demand across the board.

Recent figures suggest an encouraging rise in the number of rental properties coming onto the UK market in nearly 60 per cent of UK towns and cities. And although rents are rising modestly they are, nevertheless, rising.

A Labour-backed inquiry into the nation’s housing crisis revealed that almost two-thirds of UK tenants don’t expect to afford a mortgage in the next five years either.

Meanwhile, government house building targets have let them down again. A House of Lords committee called for 300,000 new homes to be built in England each year - but in 2015-16 just under 190,000 new properties were added to the housing stock.

The private rented sector plugs a serious gap and provides essential good quality, affordable housing for a modern generation of tenants while opening up new opportunities for people who can invest in ‘buy-to-let’ properties.

New property investors will need to have a very clear strategy, in terms of what they expect from rental returns and capital growth. Renting in 2017 is expected to be an increasingly real alternative to home ownership but landlords need to buy property at the right price and thoroughly research its marketability.

If you are considering investing in a property please give me a call for honest advice on rental returns on 01664 569700. 

2 Potential Investment properties new to the Melton Mowbray Property Market

This is on the market with Fox Butler for £130,000 and is a 2 bed semi on Staveley Road in Melton Mowbray. 2 beds on this road generally let for £ 575 pcm  and I don't see why this couldn't achieve the same level of rent. That could be a potential return of 5.3%...

http://www.rightmove.co.uk/property-for-sale/property-46521612.html

  



This nice 2 bed in Asfordby is on the market for £139,950 with Melton Premier.
It would easily let for £ 550 pcm which is a potential 4.7% return if purchased for the asking price.

http://www.rightmove.co.uk/property-for-sale/property-64164224.html

  



As many of you know I am always conservative when talking about rental valuations as I feel any investor considering a property should use realistic figures. It will be likely that we can achieve a little more on the day. 

There are other costs that should be taken into consideration include Conveyancing Fees and Stamp Duty which is higher when purchasing a second property. 

If you are considering investing in a buy to let then please give me a call for honest advice on rental returns. 

Just reduced to £130,000 - Asfordby Hill 5.3% potential return

***Update*** Harrison Murray have just reduced the asking price to £130,000 and at £575 pcm you could be looking at 5.3% return 


I keep looking at this property on for sale with Harrison Murray. It is in Asfordby Hill and this area attracts families due to the local Primary School. It is currently on for £135,000 and has been on for a little while now. 

Looking at the details it looks like it needs a new kitchen but the rooms are large and the fabric of the building looks to be in really good order. The rear of the property might not suit everyone but I believe we could get £575 pcm for this which is a potential return of 5.1% if purchased for the asking price. 


http://www.rightmove.co.uk/property-for-sale/property-56267806.html

Asfordby 2 bed - 4.8% potential return

This 2 bed semi close to the centre of Asfordby could make a great investment property. It is on the market with Melton Premier for £135,000. It would let for £550 pcm easily - giving a potential return of 4.8% 

It looks to be double glazed throughout and in good order. Its an affordable rental so I would expect it to let quickly. Asfordby is a popular location for tenants commuting to Leicester.

http://www.rightmove.co.uk/property-for-sale/property-63876914.html

Melton Mowbray - A plan for the future ...

Last week on the blog I looked at Capital Growth of property in Melton Mowbray, but the capital growth a town can hope to achieve is reliant on the Melton Borough being a desirable place to live over the next 20 years.

This is where we rely on the Melton Borough Council delivering a well thought out plan for the Borough that considers the needs of the families in the town and also employers.

One great thing about Melton Borough Council is the availability of information.    Reading through the plan it is clear they are seeking to improve –

•          Traffic flow
•         Housing that will appeal to first time buyers and young families in Melton.

Both of these improvements will encourage investment from employers through a good pool of appropriately skilled work force and ease of movement to major road networks.

You can read the draft plan at www.meltonplan.co.uk    The plan is currently at draft plan stage and completion for adoption by the council is 2018.   This is when we hope to see investment in the form of new developments and roads that will help the town to thrive in a sustainable way for the growing population.

Property investment should be carefully considered to include the potential future plans of an area. Good levels of capital growth cannot be achieved unless an investor has thought through how the town could look in 20 years time - when they may be considering selling their property.    If it's yield you are after the considerations are different.

I regularly meet with people looking to invest and each person has a different aim for their potential investment.    We have an honest discussion around the pro's and con's of any property - call me to arrange a meeting or pop into our office on Burton Street.    It is important for us that our landlords make the right investment. 

Asfordby Hill - Potential 5% return on investment

This is a really smart property on Asfordby Hill for sale with Newton Fallowell. It is a good size and looks like it needs nothing doing to it. 

It's on the market for £ 145,000 and would easily achieve £600 pcm, I always like to be realistic with my rental valuations and we would expect to achieve more than that on the day.

http://www.rightmove.co.uk/property-for-sale/property-63946250.html

Capital Growth in Melton Mowbray

If you are thinking of investing in property you need to consider the growth on the capital invested in a property as well as the rental yield you can be likely to expect.

I looked through the figure for properties in Melton Mowbray and this week I concentrated on my firm favourite a modern 2 bed house.

There are a few developments that were built around 10 years ago – still modern enough to be built with efficiency in mind and you would expect them to be low maintenance for the next 10 years.

Using Rightmove’s log of sold prices you can see exactly what each house was purchased for and what they have recently sold for as the data is collected from the Land Registry.

I found modern 2 bed properties that had been bought in 2005 and sold again in 2016 had seen an average of 11.5% growth in the capital over this time. When you consider during this 10 year period we have also had a double dip recession I think that’s pretty good going.

The rental income on these has also increased over this time. Back in 2005 we would be getting £525pcm for these 2 beds and now we are getting £595pcm.

Asfordby has also seen an increase on the 2 bed houses built around the same time, these have seen a 15% growth in capital since 2005. There are not many of these types of houses in our area though as a lot of the new building stopped around 2008.

If you consider purchasing a brand new property in 2017 you can expect to pay a premium and unless a deal can be negotiated with the developer the yields are not always favourable for investors – this is why many like the properties built around 2005.

The difficulty for investors is getting hold of these types of properties. They don’t come on to the market very often and they sell quickly. Keep an eye on my blog for properties coming up for sale in the Melton area.

New Year Resolutions

As I look to welcome in the New Year I have started to think about New Year resolutions. If you have considered investing in property then 2017 might be the year to do it.   

Although the Government’s attitude to landlords appears to be fairly negative at the moment; I think that they will soon realise the housing market needs a good balance of quality rental properties alongside affordable homes.

The government must also encourage people to plan for their future.  The historic poor performance of many pension plans has put people off these types of investments.   A lot of our landlords see their investment property as a source of income when they retire.

Property investment is not a quick cash option but a long term investment and with the right consideration can give you a mortgage free asset in 20 years.   Even with the ups and downs of the recessions if you are in a position to hang onto your investment property is a great option.

Looking at Rightmove there is a really nice 2 bed on the Country Park Estate for just under £120,000 with a garden and a garage in a block.   It is on the market with Harrison Murray and they have said the vendor is keen to sell as the property is currently empty.  This would let really quickly for at least £550 pcm.  (I always like to be realistic with any rental valuation so investors can calculate yields based on an easily achievable figure). See my blog post on the 22nd December 2016.

Why not make an appointment to talk to myself or Katie at our office or at your home and we can go through what it's like to be a landlord.   We will ensure you have all the facts and figures to make sure you can make the right decision.   We can help you find a property that will appeal to tenants and give a stable return on your investment.

So my resolution for 2017 is I believe it is going to be one of hard work and making the most of the opportunities we have.

Christmas Bargain - £119,950 on the Country Park Estate 5.5% return!

Harrison Murray have just listed this great 2 bed ground floor property with its own private garden and a garage in a block. These were built I believe as an affordable option on the Country Park Estate - I guess in the 1970's?

Its one of the nicest areas in Melton Mowbray and a great location for local schools. These typically let for £550 pcm which is a 5.5% return if purchased for the asking price. 

http://www.rightmove.co.uk/property-for-sale/property-63668129.html

New Street Asfordby, 5.3% return on £122,500 investment

This is a nice 2 bed on the market for sale with Harrison Murray for £122,500 and is in Asfordby.

It looks to be in good condition inside and would easily let for £550 pcm. This type of property lets really quickly.

http://www.rightmove.co.uk/property-for-sale/property-63426056.html

Melton Mowbray Town Centre Stunning Refurbishment 5% Return

This former office building has been beautifully refurbished and looks to have a thoroughly modern finish while retaining the character features. This property has large rooms and would let really well I think. It has a parking space at the back and the high spec finish will help it achieve a potential 5% return on investment.

http://www.rightmove.co.uk/property-for-sale/property-57231658.html

Uncertainty in the Melton Mowbray Property Market for 2017

I have been reading lots of articles in the media about uncertainty in 2017, if 2016 is anything to go by who knows what will happen!!

It got me thinking about the Melton Mowbray property market, employment levels and the availability of credit?

We have to realise that the chronic shortage of housing will keep prices buoyant even if lending does become more difficult.

We have seen lots of changes in Melton Mowbray since 1998.  If there has ever been a problem for people to borrow money or to secure a mortgage, it has always increased the numbers of people looking to rent a property.

The increased demand, and shortage of rental available, only results in rents increasing.   Perhaps it will become more viable for a landlord to invest if they can see the returns on a rental property grow.

The government do seem keen to keep increasing the taxation levels on landlords.   Without people investing in property there would be no Private Rented Sector to cater for those who choose to and need to rent.   It’s often their only option or the best option for their current circumstances.

I believe we will see those with some cash to invest still buying property, especially if the yields become more favourable, as the returns from savings are expected to remain low.  The increasing yields would offset the increasing taxation levels for landlords but it is not going to help the tenants of Melton Mowbray – many who are just about managing at the moment.

If you are already a landlord and concerned about the effect of a potential unsettled period there are things you can do to minimise your exposure to risk.   The main things are ensuring your property is well maintained and regularly inspected.   Make sure you have a comprehensive Buildings insurance with reasonable excesses – you don’t want any nasty surprises from an escape of water for example.

It seems very unlikely, but should employment levels in Melton Mowbray ever be affected, Landlords could consider taking out a Rent Guarantee.   If a tenant becomes unable to pay then the rental income will be protected and the costly eviction process will also be covered.   I do believe here in Melton Mowbray we are well placed geographically for people to be able to find work.

If you would like to discuss anything about the Melton Mowbray Property Market please call me on 01664 569700

2 Bed Investment Could See Return of Over 5% - Wellington Way, Melton

These ever-popular 2 bedroom properties are situated on a quiet development on the north side of town.  They always let quickly and easily and this particular example looks to be in great condition.

On the market for sale with Newton Fallowell with an asking price of £139,950, it could give the investor a yield of around 5%.

Full details can be found here:

http://www.rightmove.co.uk/property-for-sale/property-57254650.html