Thursday, December 31, 2015

Asfordby Hill for sale at £106,000 - 6.2% return

This property is on the market for £106,000 with Melton Premier. It is a 2 bed terrace in an area that is popular with people renting due to the convenient location for commuting to Leicester and Nottingham and the primary school around the corner. 

We let properties on this road for £ 550 pcm and this should achieve that. This would give a potential return of 6.2%.

Monday, December 21, 2015

Melton Mowbray House Price Monopoly: How do Prices vary?

Whether you are a homeowner or landlord in Melton Mowbray, what would a Monopoly board look like today in the town? Property prices over the last 80 years have certainly increased beyond all recognition, so looking at the original board, I have substituted some of the original streets with the most expensive and least expensive locations in Melton Mowbray today.

Initially, I have focused on the LE13 postcode only, looking at the Brown Squares on the board, the ‘new’ Old Kent Road in Melton Mowbray today would be Bramley Close, with an average value £48,400 (per property) and Whitechapel Road would be Drummond Walk, which would be worth £90,100. 

What about the posh dark blue squares of Park Lane and Mayfair? Again, looking at LE13, Park Lane would be Hunt Drive at £329,600 and Mayfair would be Kirby Lane at £420,200. However, look a little further afield from the LE13 postcode, and such roads as Pickwell Road in Leesthorpe would claim the Mayfair card at £765,000! 

Also, I can’t forget the train stations (my favourite squares), and over the last 12 months, the average price that property within a quarter mile of the station sold for was £215,950.

So that got me thinking what you would have had to have paid for a property in Melton Mowbray back in 1935, when the game originally came out?

  •         The average Melton Mowbray detached house today is worth £322,320 would have set you back 538 Pounds 3 shillings and 8 old pence.
  •         The average Melton Mowbray semi detached house today is worth £175,510 would have set you back 317 Pounds and 11 shillings.
  •         The average Melton Mowbray terraced / town house today is worth £148,680 would have set you back 269 Pounds and 1 old pence.
  •        The average Melton Mowbray apartment today is worth £118,590 would have set you back 214 Pounds 11 shillings and 3 old pence.

Anyway, I hope you enjoyed this bit of fun, but underlying all this is one important fact. Property investing is a long game, which has seen impressive rises over the last 80 years. 

In my previous articles I have talked about what is happening on a month by month or year by year basis and if you are going to invest in the Melton Mowbray property market, you should consider the Melton Mowbray property you buy a medium to long term investment, because Buy to let is pretty much what it sounds like – you buy a property in order to rent it out to tenants.

As I reminded a soon to be first time landlord from Thorpe Arnold the other week, Buy to let in Melton Mowbray (as in other parts of the Country) is very different from owning your own home. When you become a Melton Mowbray landlord, you are in essence running a small business – one with important legal responsibilities. 

On that note, I want to remind landlords of the recent and future changes in legislation when it comes to buy to let. This year, rules have changed about tenant deposits, carbon monoxide detectors and early in the New Year, landlords will have responsibilities to do immigration checks on all their tenants. Failure to adhere to them will mean a minimum of heavy fines in the thousands or in some cases, prison ... it’s a mine field!  

That’s why I write the Melton Mowbray Property Blog, where it has an extensive library of articles like this one, where I talk about what is happening in the Melton Mowbray property market, what to buy (and sometimes not) in Melton Mowbray and everything else that is important to know as a Melton Mowbray landlord. 

Thursday, December 17, 2015

Asfordby potential 5.5% return

I have overlooked this property on the market with Harrison Murray as I have not seen many houses on this street come up for sale and be presented so nicely. This one inside has been really well finished and is on the market for £120,000.

It would let for £550 pcm giving a potential return of 5.5%. Definitely worth a viewing.

Click on the link to look at the floor plan...

The Melton Mowbray Property Market and £1,300,000,000,000,000,000 in loose change

The 5th of March 2009 was the date Mervyn King, the then Bank of England Governor, slashed UK interest rates to the unparalleled figure of 0.5%. 

In just under five months, starting on 8th October 2008, the rate had come down from 4.5% to that low figure, all in an attempt to ensure the British economy survived the worldwide credit crunch. Now as we deck the halls with bows of holly nobody expected that, over six years later, rates would still be at that low level.

In the summer, people were predicting a rise in the New Year, yet now, some forecast it may remain the same for years to come the due to the issues in China. 

What I do know, speaking to my Melton Mowbray friends and Melton Mowbray landlords is that these low interest rates have hit savers really hard.

If you added up everyone’s bank and building society savings in the UK, they would add up to £1,300,000,000,000,000,000 (that’s £1.3 trillion), most of which is earning a pittance in interest.  That is why more and more 40 and 50 year old Melton Mowbray landlords have been investing some of that cash into Melton Mowbray bricks and mortar, as they search for a low risk investment opportunity.

Buying a Melton Mowbray buy to let property isn’t risk free, but there are certainly things you can do to mitigate and lower one’s exposure to risk. You see by buying a rental property, it potentially offers a decent proposition in terms of being able to obtain attractive returns that beat inflation and savings accounts, yet without taking the levels of risk associated with stock markets.

The UK residential property market has long been the safest form of collateral for lenders of all varieties. Against a backdrop of a greatly changing economic environment, Melton Mowbray house prices have been extraordinarily robust, increasing by over 1715.3% between 1974 and today. Some will say there have been significant property price falls, namely in 1975, 1988 and 2008, yet each time after this has been followed by an upturn in property values. For the record, the stock markets in the same time frame only rose by 432.5%!

.. and that is the best thing about buy to let property. Unlike the stock market, with its unfathomable equities, shares and bonds, that nobody really understands (as they are controlled by some faceless whizzkid in Canary Wharf!) with a buy to let property, landlords can take control and understand their investment .. in fact you can touch and feel the bricks and mortar investment.

..  but before you go out and buy any old Melton Mowbray property, plenty of landlords still get it wrong. You have to be aware of your legal responsibilities when it comes to tenant safety, tenants deposits, energy certificates and in the new year, landlords will have the added responsibility of checking the immigration status of prospective tenants. Get it wrong and big fines and even prison is an option – but that’s why many agents use a letting agent to manage their property for them.

Next, you have to buy the right property at the right price. Recently I have seen some really heart breaking situations in Melton Mowbray and the immediate area, of people paying way too much for a property, only to lose out when they came to sell. One example that comes to mind is that of a property owner in an apartment on Buttermere Close (just off the A607) .. a decent, well presented, two bed, ground floor, apartment, 54 sq metres inside (581 sq ft in old money) sold in October 2006 for £110,700. In the summer, it only obtained £100,000, a drop of 9.67% or 1.15% a year - a very disappointing result.

I cannot stress enough the importance of doing your homework. One source of information and advice is the Melton Mowbray Property Blog or please pick up the phone and give me a call, I am always happy to talk about the Melton Mowbray Property market!

Thursday, December 10, 2015

Has Osborne killed the buy to let market in Melton Mowbray?

Well George Osborne, in his Autumn statement, caused Melton Mowbray landlords to ask whether buy to let is a viable investment option, when he announced that landlords, when buying another buy to let property from April 2016 will have to pay an additional 3% stamp duty on top of the standard rate.  

So if an investor wanted to buy a property in Melton for £123,000, before they would not have had to pay a penny in stamp duty, but from April next year it will be  £3,690. Move up market and it means that the stamp duty bill for a £285,000 buy to let home will rise from the current £4,250 to £12,800 from April next year. 

Some say property in Melton Mowbray will be worth less because potential landlords will not be willing to pay as much for them, and if house builders or existing homeowners don't feel they are going to get as much for them, then there is less motivation to build / sell them?... and the person we can blame for this is George himself. Back in 2012, he chose to utilise the British housing market to kick start the UK economy, with  subsidies, Funding for Lending and Help to Buy.

Others say this is the straw that breaks the camel’s back as over the next four years Landlords will slowly lose the ability to offset all their mortgage interest against tax on rental income, after changes announced in the Summer Budget. At the moment, landlords can claim tax relief on buy to let mortgage monthly interest repayments at the top level of tax they pay (ie 40% or 45%). 

However, over the next four years this will be reduced slowly to the basic rate of tax – currently 20%.
Surely this is the end of Buy to Let in Melton Mowbray? Probably.. but before we all run to hills panicking .. let me give you another thought.

Stamp Duty rules were changed in December 2014. Before then, landlords were eagerly buying up properties under the ‘old slab style Stamp Duty’ system. For example, the stamp duty bill on that £285,000 property was lower on the old slab style duty (pre Dec 2014), at £8,550, yet it isn’t a million miles away from new £12,800 stamp duty bill. Interestingly though, George has left a legal loophole in the new rules, because when it comes to selling up, they can offset purchase costs against any eventual capital gains tax, including stamp duty.

I believe that total returns from buy to let will continue to outpace other investments, such as the stock market, gilts, bonds and even pensions. Also, the best part about investing in property is that it is bricks and mortar. You can touch it, you can feel it, and it isn’t controlled by some City whiz kid in Canary Wharf .. the British understand property and that goes a long way!

Buy to let has enough impetus behind it that prospective landlords will continue to buy even with a larger stamp duty bill. Melton Mowbray landlords will need to be savvy with what property they buy to ensure the extra stamp duty costs are mitigated.   Buying buy to let property is a long term venture. 
Now with these extra taxes, the adage of ‘any old Melton Mowbray house will make money’ has gone out the window.   You wouldn’t dream of investing in the stock market without at least looking in the newspapers or taking advice and opinion from others, so why wouldnt you take the same advice and opinion about buying a buy to let property in Melton Mowbray? please feel free to give me a call for honest, unbiased advice on potential buy to let investments. 01664 569700

Wednesday, December 9, 2015

Blyth Avenue - great investment for sale at £125,000

This property has been listed by Harrison Murray and is on the market for just under £125,000. Although it has a shower room it would easily let for £550 pcm - potential 5.2% return. 

These types of properties are popular with professional couples as they are a nice size and have a manageable garden.

Thursday, December 3, 2015

Melton Mowbray Property Market Values

Many landlords have been asking me my thoughts on the Melton Mowbray property market recently, and in particular, what is happening to property values.   My calculations show property values in Melton Mowbray grew in the month of September by 1.9%.   

When one looks at the annual growth, Melton Mowbray values are 6.9% higher (when comparing Sept 14 to Sept 15), impressive when you consider the annual growth of property values dropped to only 0.7% per annum in May.   

There are signs, however,  that the fundamental growth of property values in Melton Mowbray has now peaked, despite those average property values being below levels recorded in 2007 (just before the 2008 crash).

Whilst the Melton Mowbray headline rate appears to be better, i.e. the year on year (Sept 14 to Sept 15) growth rate of 6.9% is obviously better than the drop of 0.7% in May 14 to May 15), this impressive rise of Melton Mowbray property values masks the underlying truth in what is really happening to local property values in the town.  

Throughout 2015, property values have been yo-yo like on a month by month basis, for example,
  •          September 2015             1.9% rise
  •          August 2015                   0.2% rise
  •          July 2015                       2.3% rise
  •          June 2015                      0.4% rise
  •          May 2015                       0.3% drop
  •          April 2015                      0.4% drop
  •          March 2015                    2.7% drop

This is in part due to seasonal factors, as well as mortgage approvals increasing over June and July then falling by over 15% in August, according to the Council of Mortgage Lenders (CML).

The outlook for the Melton Mowbray property market remains positive against the foundations of low mortgage rates and growing consumer confidence. 

On a positive note, Melton Mowbray property values are still running ahead of salaries and average property values are 5.1% below the levels recorded in 2007.

Readers might be interested to note that before the 2008 property crash, all the UK region’s housing markets tended to move up and down in tandem.   Since then though, the Greater London property market took off like a rocket in 2009/10, whilst the rest of the UK only really started to grow in 2012/13, and even then that growth was a lot more modest than the Capital’s.  

Looking closer to home, it can even be different in neighbouring towns, areas and cities, so whilst Melton Mowbray property values are 6.9% higher than a year ago, Leicester property values are 4.1% higher than a year ago.

I cannot stress enough the importance of doing your homework.  

One source of information and advice is the Melton Mowbray Property Blog where I have similar articles to this about the Melton Mowbray property market and what I consider to be the best buy to let deals around at any one time in the town, irrespective of which agent it is on the market with.  please feel free to give me a call 01664 569700

Wednesday, December 2, 2015

Modern 3 bed new to the market - Valiant Way, Melton Mowbray

As I have mentioned before, nearly new homes make a wise investment choice.  Always popular with tenants, with little maintenance, plus warranties in case things do go wrong, here is a great example of such a property.  

Being marketed by Connells, this is a 3 bed property situated on a popular development close to good schools and within walking distance of the town centre.

Looks to be in good order so should be a quick and easy process to letting your next investment property.

Full details can be found here:

Thursday, November 26, 2015

Values of Melton Mowbray Terraced Houses smash through the £190/sqft barrier

The Council of Mortgage Lenders (CML) latest snapshot of the buy to let mortgage market shows us that buy to let landlords haven’t been put off by the Chancellors announcements on the way buy to let’s are taxed.

Last month, the CML stated £1.4billion was borrowed by UK landlords to purchase 10,500 buy to let properties, up 26.5% from the same month in 2014, when only 8,300 properties were bought with a buy to let mortgage. Go back two years and the number of buy to let mortgages used for purchasing (again not re-mortgaging) is 36.4% higher! Even more interesting has been the fact that the average amount borrowed has risen as well. The average buy to let mortgage last month was £133,330, up from £128,480 a year ago.

In Melton Mowbray, I am speaking to more and more landlords, be they seasoned professional landlords or FTL’s (first time landlords), as they read reports that the Melton Mowbray rental market is doing reasonably well, with rents and property values rising.  Interestingly, one landlord recently asked how much he should be paying per square foot (more of that in a second).

The first thing you have to decide is whether you want great capital growth or great rental yield, as every knowledgeable landlord knows, you can’t have both. Over the last twenty years, property values in Melton Mowbray have risen by 160.31%, compared to Greater London’s 436.2%. This has proved that capital growth increases faster in the more expensive South, but your investment money doesn’t go very far, meaning there won’t be as much rental yield from a 1 bed flat in Chelsea (2% per year at best with a fair wind) as a 2 bed semi in Melton Mowbray. However, whilst the figure of 160.31% is an average for the area, certain areas of Melton Mowbray have seen capital growth much higher than that and others areas much worse (we have talked about those in previous articles).

If you recall in an earlier article, my research reveals that Melton Mowbray apartments tend to generate a better yield than houses, probably because several sharers can afford to pay more than a single family. But houses tend to appreciate in value more rapidly and may well be easier to sell, simply because there are fewer being built.

So what should you be buying in Melton Mowbray, and more importantly, how much?

  •         The average apartments in the town are currently selling for approximately £144 per square foot.
  •         Terraced houses in Melton Mowbray are currently obtaining, on average, £145,900 or £190 per square foot,
  •          An average semi in Melton Mowbray is selling for £172,200 (and achieving £187 per square foot). 

Now these are of course averages, but it gives you a good place to start from. In the coming weeks, I will look at rents being achieved on Melton Mowbray houses and apartments, and the yields that can be obtained, depending how many bedrooms there are. 

Thursday, November 19, 2015

Melton Mowbray Buy To let –Freehold House or Leasehold Flat?

Well my Melton Mowbray Property Blog reading friends, as seems to be all the rage with Jeremy Corben asking the PM questions emailed in to him at Prime Minster Question Times, I to wish to answer a question emailed into me from a potential Melton Mowbray landlord last week. Nice chap, lives in Thorpe Arnold, and it turns out, after having a coffee with him, he works in IT, has a spare bit of cash (now the kids have flown the nest) and wanted to buy his first buy to let property.

His main question was ... Do I buy a freehold house or a leasehold flat in Melton Mowbray?

Most people will say freehold every time, because you own the land. However, it’s not as simple as that (it never would be would it!). The definitive answer though is to research what Melton Mowbray tenants want in the area of Melton Mowbray they want! The tenant is ultimately your customer, and, if they don't want to rent what you decide is best to buy, then you are not going to have a successful BTL investment. So starting with the tenant in mind and working backwards from there, you won’t go far wrong. In a nutshell, find the demand before you think about creating the supply.

Leasehold flats and apartments in Melton Mowbray are excellent in some respects as they offer the landlord certain advantages, including the fact a flat can be initially cheaper to buy. Yields can be quite good, offering better cash flow. The building will already be insured and yes there is a service charge, but it’s still for a service at the end of the day and that cost is spread between many others (i.e. when your freehold house roof goes, its falls 100% on your shoulders) and one of my favourites is that there is often no garden to maintain or blown down fences to replace!

However, some Melton Mowbray leasehold flats can suffer from poor capital growth. Some leasehold properties have no cap on the level of the service charge and it may get out of control. The length of the lease will significantly affect value if not renewed before it gets too short. Thankfully there’s not many, but some Melton Mowbray apartments/flats have burdensome clauses. Finally, with leases, there can be sub-letting issues – which means you can’t let them out.

So what do the numbers look like? Well since 2003, the average freehold property in Melton Mowbray (detached, semis and terraced) has risen from £113,357 to £179,358, a rise of 58% whilst the average Melton Mowbray leasehold property (flats and apartments) has gone up in value from £62,498 to £114,950, a greater rise of 84%. 

I was really interested to note that of the 2,738 rental properties in the Melton Borough Council area that the Office of National Statistics believe are either let privately or through a letting agency, 476 of them (or 17.4%) are apartments. However, there are only 1,622 apartments in the whole council area (be they owned, council rented or privately rented), which represents 7.5% of the whole housing stock in the area. This really intrigued me that, quite obviously, there is a high proportion of Melton Mowbray’s leasehold apartments/flats rented to tenants compared to detached, semi’s or terraced. Fascinating don’t you think?

Every Melton Mowbray apartment block, every terraced house or semi is different. Like I said at the start, the definitive answer though is to research what Melton Mowbray tenants want in the area of Melton Mowbray they want. Demand for town centre apartments, near transport links can be popular and can offer the Melton Mowbray landlord very good yields with minimal voids. However, Melton Mowbray terraced houses and semis, whilst not always offering the best yields (although sometimes they can), they do offer the Melton Mowbray landlord decent capital growth.

My advice to the prospective landlord as it is to you is do your homework.  What many Melton Mowbray landlords do, irrespective of whether you are a landlord of ours, a landlord with another agent or a DIY landlord, if you see any property in Melton Mowbray, that catches your eye as a potential buy to let property, be it a terraced house, semi or flat ... email me and I will email you back with my thoughts (although I will tell you what you need to hear .. not want to hear!)

Friday, November 13, 2015

6% return on a £95,000 investment

For sale with Richard Watkinson a great property that could provide a 6% return. 

These quarter houses really let well for £475 pcm. This one has a lovely kitchen and bathroom that will appeal to a professional tenant. It is on the market for £95,000 and looks to be in good condition. 

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Image 2 of 9: Lounge.JPG

Thursday, November 12, 2015

How EU Migration has changed the Melton Mowbray Property Market

The argument of migration and what it does, or doesn’t do, for the country’s economic wellbeing is something that has been hotly contested over the last few years. In my article today, I want to talk about what it has done for the Melton Mowbray Property market.

Before we look at Melton Mowbray though, let us look at some interesting figures for the country as a whole. Between 2001 and 2011, 971,144 EU citizens came to the UK to live and of those, 171,164 of them (17.68%) have bought their own home. It might surprise people that only 5.07% of EU migrants managed to secure a council house. However, 676,091 (69.62%) of them went into the private rental sector.  This increase in population from the EU has, no doubt, added great stress to the UK housing market.

Looking at the figures, the housing market as a whole is undoubtedly affected by migration but it has been the private rented housing sector, especially in those areas where migrants come together, that is affected the most.  Indeed, I have seen that many EU migrants often compete for such housing not with UK tenants but with other EU migrants. In 2001, 3.68 million rented a property from a landlord in the UK.  Ten years later in 2011, whilst EU migration added an additional 676,091 people renting a property from a landlord, there were actually an additional 4.14 million people who became tenants and were not EU migrants, but predominately British!

As a landlord, it is really important to gauge the potential demand for your rental property, especially if you are a landlord who buys property in areas popular with the Eastern European EU migrants.  To gauge the level of EU migration (and thus demand), one of the best ways to calculate the growth of migrants is to calculate the number of people who ask for a National Insurance number (which EU members are able to obtain).
Interestingly, in Melton Mowbray, migration has fallen over the last few years. 

For example, in 2006 there were 202 migrant national Insurance cards (NIC) issued and the year after in 2007, 207 NIC cards were issued. However, in 2014, this had slipped to 159 NIC’s. However, if the pattern of other migrations since WW2 continues, over time there will be an increasing demand for owner occupied property, which may affect the market in certain areas of high migrant concentration. On the other hand, over time some households move into the larger housing market, reducing concentrations and pressures.

In essence, migration has affected the Melton Mowbray property market; it couldn’t fail to because of the additional 1,596 working age migrants that have moved into the Melton area since 2005. However, it has not been the main influence on the market. Property values in Melton Mowbray today are only 3.6% higher than they were in 2005. According to the Office of National Statistics, rents for tenants in the East Midlands have only grown on average by 0.66% a year since 2005 .... 

I would say if it wasn’t for the migrants, we would be in a far worse position when it came to the Melton Mowbray property market. This was backed up by the then Home Secretary Theresa May back in 2012 - more than a third of all new housing demand in Britain is caused by inward migration and there is evidence that without the demand caused by such immigration, house prices would be 10% lower over a 20 year period.

If you are considering investing in a rental property please give me a call or pop into see me for unbiased opinion on the potential return of a buy to let purchase. 

Thursday, November 5, 2015

Melton Mowbray Property Market Crisis as New House Building slumps by 83.33%

One of the key factors that determine the price of anything is the demand and supply of the item that is being bought and sold. When it comes to property, demand can change overnight, but it takes years and years to build new properties, thus increasing the supply.

The Conservatives have pledged to build over 1 million homes by 2020. I am of the opinion that as a country, irrespective of which party, we have not built enough homes for decades, and if the gap between the number of households forming and the number of new homes being built continues to grow, we are in danger of not being able to house our children or grand children. I believe the country is past the time for another grand statement of ambition by another Housing Minister.

Surely it’s right to give normal Melton Mowbray families back the hope of a secure home, be that rented or owned? As a town, we need to exert pressure on our local MP Alan Duncan, so they can make sure Westminster is held accountable, to ensure there is a comprehensive plan, with enough investment, that can actually get these homes built.

To give you an idea of the sorts of numbers we are talking about, in the Melton Borough Council area in 2007, 210 properties were built. In 2008 that rose to 250 and a year later in 2009, it peaked at 300. By 2014, that figure had dropped by a massive 83.33% to 50 properties built.

The outcome of too few homes being built in Melton Mowbray means the working people of the town are being priced out of buying their first home and renters are not getting the quality they deserve for their money.

I talk to many Melton Mowbray business people and they tell me they need a flexible and mobile workforce, but the high cost of moving home and lack of decent and affordable housing are barriers to attracting and retaining employees. Furthermore, building new homes is a powerful source of growth, creating jobs across the county and supporting hundreds of Melton Mowbray businesses.

It is true that landlords have taken up the mantle and over the last 15 years have bought a large number of properties. The Government need to be thankful to all those Melton Mowbray landlords, who own the 1,533 rental properties in the town. Most local landlords only have a handful of rented properties (to aid their retirement), and without them, I honestly don’t know who would house all the extra people in Melton Mowbray!

Moving forward, those Melton Mowbray landlords have many pitfalls, both in the short term and medium term. For instance, were you aware that the rules of changes for new tenancies from the 1st October 2015 (with some imposing penalties including loosing the right to require the tenant to vacate, if they are done incorrectly) or in the medium term, the planned change in the way buy to let’s are taxed?

More than ever, the days of buying any old property in Melton Mowbray and you would be set for life are gone. Now, it’s all about ensuring you stay the right side of the law, buying the right property (and that might mean even selling some to buy others), so you build the right portfolio for you as a landlord.

Please give me a call or pop into see me to seek honest advice before you invest in a buy to let property.

Monday, November 2, 2015

Great Investment opportunity on Browning Close

This is a great family property for sale with Connells, currently on the market for £190,000. It is in an area that sees great capital growth and is ideally located for John Ferneley Secondary School and Sixth Form. 

This would easily let for £675 pcm, (probably more in the current rental market) 4.2% yeild - but more exciting is the potential capital growth.

According to Zoopla, semi detached properties in the street have seen an increase of 16% over the last 5 years and this property has the potential for an extension. This means the property will have a greater appeal when it comes to resale whether it has been extended or still has the opportunity for this to be done. Something that is just not an option when investing in new build properties.

Thursday, October 29, 2015

Project property for sale at offers over £80,000

Ok so this house is not a looker but it has potential! Its on the market with Springbok Properties for offers over £80,000 and could be a good option for someone looking to take on a project. 

As long as no more that £20,000 was spent on the kitchen and bathroom then when it achieves £475 pcm in rent you will see a 5.7% return. We have a few of the two beds in this row and they let easily at £475 pcm.

Could your Melton Mowbray property save you from Pension oblivion?

If you were born in the early 1970’s or late 1960’s, if you haven’t started to think about it yet, retirement is closer than you think. In fact the number of years you have left to work is less than the number of years you have worked. The basic state pension is worth £115.95 a week for a single person in 2015/16 (or £6,029 a year) and £231.90 a week for a couple (£12,118 a year) as long as your partner has paid their stamp (although there are certain get of jail cards if they haven’t). 

As a household, could you live on just over £12k a year?

However, could the property you are living in in Melton Mowbray save you from poverty when you reach retirement? You see, a regular income is vital in retirement, and the bricks and mortar you own in Melton Mowbray could provide a way for you to finance life when you retire.

If you are in your 30’s, you could keep your terraced or small semi, turning it into buy a buy to let property, let the rent pay the mortgage and then rely on capital growth to provide you with a lump sum when you sell the property and retire.  

One of the biggest plus points of buy to let is what is known as leverage. Let me explain ... say you have a deposit of 25% and the value of the property rises by 3% a year, your gains in fact multiply to 12%.  However, if property prices drop, 'leverage' can be catastrophic, as losses will also be multiplied. Property values have dropped a number of times in the last 50 years, but they always seem to bounce back ... property must be seen as a long term investment.

Let me explain how leverage could work for you. If you had bought a Melton Mowbray house in Spring of 1983 for £25,000, using a 75% mortgage and 25% deposit, (meaning your deposit would be £6,250). Today, that Melton Mowbray property would have risen in value to £168,458, a rise of 541.8%. However, when you look at the growth on just your deposit, the rise is even better ... instead of 541.8%, we see a rise of 2467% (remembering that the mortgage would have been paid off).

However, buy to let is not all about capital growth and in retirement, income is more important than capital growth, as rent is the key to a steady income.

So surely the best strategy is to buy those Melton Mowbray properties with the high rents (when compared to the value of the property). These are called high yield properties in the buy to let world because the monthly return is so much greater. So surely they are the best in Melton Mowbray? Possibly, but the properties that offer these higher yields (in the order of 6% to 9% per year) tend to be in such areas as Asfordby in Melton Mowbray, historically they haven’t offered such good capital growth when compared to the town average.

Another strategy could be buy a property with relatively smaller rental returns of 4% to 5% per year (i.e. lower yields), but in a more up market area such as Burton Lazars. Properties such as these tend to suffer from less void periods (i.e. when there is no tenant in the property paying you rent) and they historically have had better long term capital growth when compared to the town average.

Every landlord is different and every property is different. All I suggest to you is do your homework.

As regular readers will know, I am happy to share my knowledge and experience of the Melton Mowbray property market, high yields, high capital growth, what to buy, what not to buy and where to buy in the Melton Mowbray Property market can always be found on the Melton Mowbray Property Blog or pop in and see me at our Burton Street office.

Wednesday, October 28, 2015

Brand new buy to let opportunity on Scholar's Grange, Melton Mowbray

New builds are forever popular with tenants, and make a wise choice for investors too. Benefiting from a 2 year warranty on most items inside the property, plus the 10 year NHBC warranty, buying a new build ensures a pretty maintenance free investment opportunity.

Situated on a popular, quiet development by Persimmon Homes, this plot is on the market for £175,995.  As it is one of the last plots available of this phase, I suspect there are bargains to be had!  It should see a return of over 5%.

Full details can be found here:

3 bedroom semi detached house for sale in Leicester, Leicestershire, LE13 1LB - The Redcar

Thursday, October 22, 2015

Melton Mowbray tenants feel the squeeze as rents continue to rise

As my regular readers know, my passion is talking about Melton Mowbray property. This week, I want to highlight the plight of the tenants of Melton Mowbray as more and more of their wages are being taken up by ever increasing rents.

The cost of renting a home in Melton Mowbray has nearly broken through the £600 a month barrier as the average rent for a property in the town, now stands at £594 per month, a rise of 1.6 % last month, leaving rents for new lets 6.6% higher than they were 12 months ago.

House price inflation has certainly eased in Melton Mowbray from the heady days of 2014, but still with retail price inflation (for goods and services) reducing to 0% any increase in property values, no matter how small, means in real terms property is still getting more expensive. Meanwhile, many tenants have given up saving for a mortgage deposit as rents continue to take more and more of their wage packets leaving nothing to save for a deposit. That means, more and more tenants are deciding to rent for the long term and therefore the desire for decent high quality rental properties continues to exceed the available rental stock.
I would go as far as to suggest that rents are an ideal barometer to the state of the local economy as a whole and strongly believe that the recent increase in Melton Mowbray rents are a sign that the Melton Mowbray economy is picking up. 

This means Melton Mowbray landlords are continuing to capitalise on the Melton Mowbray property market. The most recent Land Registry data suggests the annual property price rises in the town have eased over 2015, leaving property values only 3.89% higher than 12 months ago, so as property price growth is easing off, with the increased rents, rental yields are strengthening for the first time in years to compensate. The mortgage market has become more stable after the mad months of May and June after the Conservatives got back into No.10, and so, everything is set to be good news for landlords; even with the Chancellors change of tax rules in the coming years for buy to let mortgages.

You can get some amazingly low mortgage rate deals at the moment, so with mortgage rates so low and returns still extraordinarily attractive, there’s rarely been a better time to invest in rental properties.

However, (you knew there would be a however!), it’s all about buying the right property at the right price. Not all property types are seeing equal rises in rents and capital growth.  Different parts of the town, different types of properties are experiencing quite different changes.  For example, the average length of time the 17 Melton Mowbray properties up for rent between £250 to £500 per month is an eye watering 272 days, whilst the average length of time the 25 properties at £500 to £1000 per month is 37 days and 4 properties that fall into the £1000 to £2000 per month price bracket just 23 days.

When you start comparing different parts of Melton Mowbray, the numbers are even stranger!  The bottom line is that you must take advice and opinion. One source of advice and opinion is the Melton Mowbray Property Blog. In the Melton Mowbray Property Blog, you will see many more articles like this, discussions and even what I consider to be the best buy to let deals around, irrespective of which agent is selling it.

Thursday, October 15, 2015

Melton Mowbray Property Market - Asking Prices Drop but Values remain the same

Over the last month, there appears to have been an anomaly in the local property market, whereby asking prices in the town have dropped, and property values have remained the same.  The average asking price of a Melton Mowbray property, according to Rightmove, fell 1.4% this month yet the average value of a Melton Mowbray property stayed the same.

So how does this relate in monetary terms?  This anomaly has driven the average asking price of a Melton Mowbray property down slightly to £205,900 whilst the average value is now £230,100.

So why the difference? Technically an ‘asking price’ can be any price that a homeowner wants to place his or her property on the market for. Unfortunately, many times this is done without research and can result in overpriced properties that don't sell. As the Summer months are normally slightly quieter those left on the market wanting to sell often temper their asking prices in these months to try and generate interest in their property.

On the other side of the coin, the property ‘value’ is the price that a willing buyer is prepared to pay and a willing seller is prepared to sell at.   Therefore, in a nutshell, Melton Mowbray property values are continuing to rise and those homeowners in Melton Mowbray who have properties on the market, last month on average, reduced their asking prices .. great news for property owners and buyers alike!

In previous articles, I have spoken about the continued fundamental shortage of property coming on to the market compared to buyer demand. That is especially true for homeowners wanting to upgrade to a better house/better location.  I can appreciate Melton Mowbray home owners are reluctant to put their own property on the market speculatively and wait for the right property to become available and some high demand locations can suffer from a property stalemate.

However, for the landlord/buy to let investors, these potential problems are nothing further from the truth. As I write this article, there are 18 flats for sale, 41 terraced houses and over 28 semis for sale in Melton Mowbray.  Landlord/Buy to let investors can normally pick up some bargains in the Autumn months, as sellers who are selling their homes often have a pressing need to sell by this time.

The types of houses a Melton Mowbray landlord typically buys, are not the same types as the homeowners. The best types of properties for buy to let are the smaller flats, terraced and semis (not the big detached ones).

If you are a landlord or thinking of become one for the first time, and you want to read more articles like this about the Melton Mowbray Property Market together with regular postings on what I consider the best buy to let deals in Melton Mowbray, out of the many of properties on the market,  irrespective of which agent is selling it, then keep an eye on this property Blog. 

Robin Crescent, on the market for £89,950

These quarter houses are a great investment for someone. This one is listed with Moores and is on the market for £89,950. 

We let these for £450 - £475 pcm and this one looks to be ready to let, no work needed and low maintenance.

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Thursday, October 8, 2015

Wren Close - 3 bed semi potential 5.2% return

This property is for sale with Melton Premier and is for sale at £136,950. It is a nice size property that would easily let for £600 pcm.

Definitely worth considering as a buy to let investment as it looks to be in good condition from the pictures.

Swallowdale catchment area properties outperform Melton Mowbray average by 36.11%

I was having a chat with a Melton Mowbray property investor the other day, when he asked if schools, especially primary schools, affected the local property market in terms of demand from buyers and tenants to a property.  

Anecdotally, I have always known this to be true, a good school creates good demand and good demand does affect house prices.  So, we looked at the phone calls from people putting themselves on our mailing list and they confirmed that most people cite location as their number one factor.

After looking through our mailing list, it confirms there is a close correlation between the high demand areas of Melton Mowbray and the close proximity to a good primary school.  Not just families either. An area will appeal to couples setting up home who want to live in an area that has benefitted from the popularity a good primary school provides.
Those of you who regularly read this blog will know I like a challenge, so I decided to look at the science behind these assumptions.  

According to the SchoolGuide website, Swallowdale Primary School is one of the best primary schools in Melton Mowbray.  Its figures are certainly impressive. Their last Ofsted Report classified it as Outstanding, 90% of 11-year pupils achieving Level 4 or above in maths, reading and writing whilst 25% of them achieved level 5.  Finally, the schools’ KS2 rating was classed as Good.

Looking at property sales within half a mile of Swallowdale, property values have risen in value since 1999 by 168.11%, whilst according to recent figures, the Melton Mowbray average as a whole has risen in the same time frame by 123.51%.

That means the parents of Swallowdale have seen the values of their properties rise proportionally 36.11% more than the Melton Mowbray average ... interesting don’t you think?

However, whilst a good primary school significantly contributes more to house prices, the same can’t be said for secondary schools. There are two reasons for this, firstly, as secondary schools are much larger, so their catchment areas are correspondingly much larger, meaning parents don’t need to live so close to the school. Secondly, in the UK, whilst the difference between the top 25% and bottom 25% of secondary schools is not insignificant, in the primary school sector, the difference between the top 25% and bottom 25%, according to the London School of Economics, is considerably and significantly more.

Many other Melton Mowbray landlords, both who are with us and many who are with other Melton Mowbray agents, like to pop in, ring or email us to discuss the Melton Mowbray property market, to consider how Melton Mowbray compares with its closest rivals and hopefully we can answer all their questions. You must take lots of advice and seek out the best opinion. One good source of opinion, specific to the Melton Mowbray property market is the Melton Mowbray Property Blog I don’t bite, I don’t do hard sell, I will just give you my honest and straight talking opinion.

Thursday, October 1, 2015

Crisis in the Melton Mowbray Property Market ..probably?

I don’t know about you, but if you watch Sky News every waking hour or read the newspapers, it always seems we as a Country, Europe or the World seem to lurch from one crisis to another.

This month’s crisis is the buy to let boom and as George Osborne always likes to be topical, in the July emergency budget, he declared that he will start to scale back, from 2017, the tax relief that those high income tax rate landlords with a mortgage have benefited from. The Daily Mail ran headlines stating it was the end of the private landlord; predicting many landlords will give up on buy to let altogether and we will be inundated with rental properties up for sale as landlords feel squeezed from the market.

Even Mr Carney, the Governor of the Bank of England, recently cautioned that the buy to let property market could destabilise the whole UK property market. He was concerned landlords who bought with high loan to value mortgages could be spooked if there is a property crash, they would panic because of negative equity, sell cheaply, which would worsen house price falls.

End of the world then?   .. this week, yes probably, but next week .. that’s another story!  Before we all go and live like a hermit in the Scottish highlands, let me explain to you my perspective on the whole subject. As I mentioned a few weeks ago, two thirds of buy to let properties bought in the last eight years have been bought mortgage free – so they won’t be affected by the Chancellors’ tax changes.  Also, something I feel is often overlooked but very important, is the fact that landlords historically have only been able to normally borrow up to 75% of the value of the rental property.  In the last property crash of 2008, property values dropped by the not so insignificant figure of 16.9% in Melton Mowbray, but even then, when we had the credit crunch and the world’s banking sector was on the brink, no landlord would have been in negative equity in Melton Mowbray.

I believe we have a case of ‘bad news selling newspapers’ and I believe that buy to let, and the property market as a whole, will carry on relatively intact. It’s true reducing tax relief will hit landlords who pay the higher rate of income tax and this may slightly diminish buy to let as an investment vehicle, but I doubt people will sell. Many landlords have been lazy with their investments, buying with their heart, not their head. You would never dream of investing in the stock market without doing your homework and talking to people in the know. If you want to make money in the Melton Mowbray property market as a buy to let landlord, it’s all about having the right property and as you grow, the right portfolio mix to offer a balanced investment that will give you both yield and capital growth.

The Melton Mowbray buy to let market still offers good investment opportunities to new and old alike. Those who have bought in the last twelve to eighteen months have reaped the benefit from buying in Melton Mowbray, because the town offered a combination of reasonable house prices with subsequently increasing rents.  Property values have risen by 7.8% in the last eighteen months in Melton Mowbray, whilst looking at rents, in Q2 2015, average rental values for new tenancies were 3% higher than Q2 2014, which is particularly interesting as they only rose by 1% between Q2 2013 and Q2 2014.

I cannot stress enough the importance of doing your homework. One source of information and advice is the Melton Mowbray Property Blog. If you haven’t visited and you are interested in the local property market in Melton Mowbray .. you are missing out! .. 

3 bed on West Avenue £120,000

This property for sale with Connells on West avenue, it has been let in the past for £535 pcm but would go on the rental market today for at least £550 pcm, possibly £575. 

It has large bedrooms and open views at the back so it has been a popular rental property. At £120,000 and letting for £550 pcm would see a potential return of 5.5%.

Thursday, September 24, 2015

Interest rates set to rise – How will that affect the Melton Mowbray property market?

Previously, I mentioned in this blog about how the Bank of England has been indicating recently that UK interest rates will be going up in the not too distant future. Therefore, if you are one of the 4,249 homeowners in Melton Mowbray, who own your own home with a mortgage, then you need to consider your options and start to budget for an interest rate rise. However, if you are a landlord, who owns one of the 1,378 rental properties in the town, whilst your exposure to interest rate rises is lower, it is most certainly something you should be aware of.

Since the spring of 2009, British interest rates have been at a record low of 0.5%. It’s not a case of if, but when, they will rise. Some people think it will be before Christmas, although I am of the opinion, it will early in the New Year around Easter time, when they do rise. I also expect those rises will be slow, steady and limited. It depends on what is happens to UK wage rises, UK inflation and the general state of the British economy. Nevertheless, as much most of us in Melton Mowbray would love to pull the shutters and stick two fingers up to the world, we have to recognise we are part of a global economy and global economic worries still exist to prevent an abrupt and instantaneous rate rise.

Those Melton Mowbray landlords, who do have a mortgage, need to realise that as interest rates rise, their monthly mortgage costs rise. It’s easy to say you will look at your mortgage next month, then before you know it, Christmas will be here!  Don’t forget, mortgage lenders have always removed the juicy low rate mortgage deals a few months before interest rate rise. Speak to a qualified mortgage arranger, there are lots of them in Melton Mowbray and seriously consider fixing your mortgage rate now.  You didn’t buy your Melton Mowbray buy to let property for it to become a millstone around your neck. It’s all about mitigating your costs and maximising your income to make your Melton Mowbray buy to let property the investment you want it to be.

However, on the other side of the coin, two in three landlords who have bought property since 2007, have done so without a mortgage. A rise in interest rates might be a good thing. Let me give you some background first, then I’ll explain why. Melton Mowbray landlords have see their return on investment for their Melton Mowbray buy to let property, over the last couple of years, perform very well indeed with Melton Mowbray property values rising by 13.83% since the Spring of 2009. 

However, when rates do rise, whilst more expensive mortgage rates will ease the demand for borrowing, on the other hand, it may temper house price growth, making the property market more competitive... and therefore, we should see the return of some bargain property buys in Melton Mowbray!

If you are a landlord looking for a bargain now, don’t despair ... there are plenty out there, if you know where to look! One place is Rightmove, another Zoopla and another OnTheMarket. However, sometimes, you can’t see the wood for the trees. At the time of writing, Rightmove had 168 properties for sale in Melton Mowbray, Zoopla 79 properties for sale in the town and OnTheMarket 46 properties ... where do you start? A lot of savvy Melton Mowbray landlords like to visit this Blog, where, irrespective of which agent is selling it, I regularly post what I consider out of the many properties on the market, to be the best buy to let deal in Melton Mowbray.   

At last! some new builds for sale in Melton Mowbray!!

Bentons have just listed this new development with an open house on the Saturday 3rd October. 

They are priced from £132,500 and would let for at least £550 pcm, depending on the plot and parking they could achieve £595 pcm. 

They have a layout that suits the modern tenant and have been built by builders with a good reputation. I know these would let really quickly...

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