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Should Crediton Landlords Be Worried About These New Rental Regulations?

Everyone should be doing their bit to help reduce the UK’s carbon footprint on the globe – yet the question is, is that burden being put too much on the shoulders of Crediton landlords with potential bills of £7,600+ in the next four years?

The background – the UK has obligated itself to a legally binding target to be carbon neutral by 2050. One of the biggest producers of greenhouse gasses is residential homes.

To hit that carbon-neutral target (as one-fifth of the UK’s carbon output comes from residential property), every UK home will need to achieve a minimum grade of ‘C’ on their Energy Performance Certificate (EPC) by 2035. Each EPC has a rating between ‘A’ and ‘G’ – ‘A’ being the best energy rating and ‘G’ the worst – like an energy rating on a fridge or washing machine.

All UK rental properties have required an EPC. Yet, from April 2020, the Minimum Energy Efficiency Standards (MEES) regulations have required all private rental properties (including rental renewals) to have a minimum EPC rating of ‘E’ or above.

Yet new legislation being discussed by the Government’s Climate Change Committee has suggested that landlords should play their part and increase the energy efficiency of their private rented homes. Sounds fair until you dive into the details.

The Government is muting the idea that all new tenancies (i.e. when a new tenant moves in) in private rented properties should be at an EPC rating of ‘C’ or above by 2025 (and all existing tenancies by 2028). The issue is…

69.95% of all private rented properties in Mid Devon have an EPC rating of ‘D’ or below.

The problem is some Crediton landlords will find it very expensive, neigh impossible, to improve the energy efficiency of their Crediton rented properties, especially those Crediton landlords who hold older housing stock such as terraced properties built in the 1800s. These Victorian terraced houses never perform well on EPC ratings as they have solid walls.

Now, of course, you can improve the EPC rating of a terraced house by improving roof insulation, boiler replacement, solar heating, and high-grade uPVC windows. Yet, with some terraced houses, there will come the point where you will be unable to get to the haloed ‘C’ rating without installing external or internal wall insulation, sometimes even floor insulation.

With wall insulation costing between £5k and £15k and floor insulation around £5k…

the bill to improve all Mid Devon’s private rented properties will be a minimum of £21,307,960.

But before I talk about what the options are for Crediton landlords, here’s the weird part of EPC’s. An EPC rating is calculated on the cost of running a property and not the carbon output or energy efficiency, despite its name.

My advice to Crediton landlords – although it’s correct to create a future strategy, all I can say at this point is ‘more haste less speed’. These rule changes are only a discussion paper, and it remains open for consultation by any member of the British public until 30th December 2021. That means the Government’s strategies and tactics may change.

Given that 57% of private rented properties are below a ‘C’ EPC grade, it is hard to believe the Government could achieve this without making big cash grants available.

For example, there is presently a cap of £3,500 for energy improvements that Crediton landlords have to spend to get it to the existing EPC ‘E’ target grade on private rented homes (i.e. if you have a privately rented home at an ‘F’ or ‘G’ EPC rating, you only need to spend a maximum of £3,500 as a landlord on improving your EPC rating and still being legal even if those £3,500 don’t get you to the current ‘E’ rating minimum). So, if the current rules allow an exemption to the EPC renting rules, if a Crediton landlord can’t improve their Crediton property enough, conceivably, could this be extended?

So, what are Crediton landlord’s options?

One thing you could do is put your head in the sand and hope it all goes away!

Another thing some savvy Crediton landlords do (be they my client, clients of other letting agents in Crediton or even self-managing landlords) is to sit down and plan a strategy for their Crediton rental portfolio. I print off all the EPCs of their rental portfolio, look at the recommendations, then discuss a plan to ensure they are covered whatever the Government decides to make the new EPC rules. Like all things in life, plan for the worse and hope for the best.

If your agent isn’t offering that service, please drop me a line because I would hate for you to miss out on the advice and opinion that so many Crediton landlords have already had from me. The choice is yours.

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With Crediton Tenants Deposits Totalling £522,120, How Will ‘Lifetime Deposits’ Change the Crediton Rental Market?

The Government’s scheduled publication of their White Paper for the Renter’s Reform Bill, which incorporates proposals to forbid Section 21 evictions and introduce ‘Lifetime Deposits’, has been suspended until 2022.

The additional time is required to give a chance to create a level playing field to reforms for both landlords and tenants in the private rented sector in England.

In this article, I want to look at these lifetime deposits. How could the Lifetime Deposit Scheme work, and how could they benefit both Crediton landlords and Crediton tenants?

When a tenant moves between rented homes, they need the deposit for their new home before being released from their old home.

The average deposit for a Crediton rented home stands at £859.

This means finding that amount of money at the time of moving home can be difficult for many tenants; thus, they become stuck in their existing rental.

Therefore, Westminster wants to propose in this White Paper a new deposit choice for tenants. A deposit is transferred from the old landlord (letting agent) to the new landlord (letting agent), thus making life simpler as the tenant doesn’t need to save for an additional new deposit every time they move home.

Now, of course, it’s vital that any new ‘deposit scheme’ does not dissuade Crediton landlords from making valid claims for damage to properties. Landlords cannot be expected to give up their right of recourse to a security deposit until such time that they are satisfied there will be no need to claim it.  

So how would Lifetime Deposits work?

There would need to be some form of system safeguarding that the new Crediton landlord is protected by a whole deposit, even if the deposit on the old Crediton home comes into dispute.

This will be critical and central to Crediton landlords having conviction in the Lifetime Deposit Scheme. That could be something like an interest-free loan for the tenant on the crossover between the properties.

Another advantage to the scheme is that ‘lifetime deposits’ could be used for tenants to build a deposit for a house for the future.

What about the existing system of deposits?

The rules regarding the amount of deposit held by a Crediton landlord were changed a couple of years ago, where only five weeks’ worth of rent can be held as a deposit.

The deposits Crediton tenants have had to save for certainly raises the cost of renting a Crediton home.

Some say this extra burden puts another nail in the coffin of the dream of homeownership for many Crediton renters. To give you an idea of the level of deposits held for Crediton rental properties…

The total of all the tenants’ deposits in Crediton are £522,120.

Yet the other side of the argument contends that if the Crediton tenant misses more than one month’s worth of rent, the landlord is immediately out of pocket, even before they’ve got the costs of solicitors and any improvement works from the tenant trashing the place. 

Does a deposit of just over one month provide Crediton landlords with a decent level of protection against unpaid rent or damage to the property? When you consider…

The total value of all the privately rented properties in Crediton is £192,726,880.

Before I conclude my thoughts to the initial question of lifetime deposits, the need for decent landlord insurance to ensure you are adequately covered as a Crediton landlord is vital.

So, what are my thoughts on ‘Lifetime Deposits’?

It is my opinion the common need for Crediton tenants to stump up a ‘two-fold deposit’ is not helping many Crediton renters when it comes to moving home. It’s clear the standard cash down deposit is not fit for purpose for the 21st Century.

One might suggest the Government’s quest for the ‘lifetime deposit’ could open the door to other deposit alternatives that have come onto the market for tenants in the last few years.

Some landlords don’t require a deposit yet are compensated by asking the tenant to pay a higher rent to cover the risk. Also, there are companies that offer insurance backed deposits where the tenant pays one week’s rent to an insurance firm, and the insurance firm pays out if a loss is incurred by the landlord.

Interestingly, other countries are already offering deposit loans and guarantee schemes. Could this be something for the British Government to contemplate?

We must wait until at least the spring of 2022 for the Renter’s Reform White Paper to be published. Then every stakeholder involved (tenants, landlords and agents, et cetera) can look at it in the cold light of day and decide how this will affect the way they view the landlord/tenant/agent relationship.

Many will say the bigger issue isn’t ‘Lifetime Deposits’ in the White Paper, but the removal of no-fault Section 21 evictions. The removal of Section 21 is something the current Governmen4t have pledged to bring in during this parliamentary cycle (i.e. before Q4 2024). 

I am not concerned about removing no-fault Section 21 evictions, but what will replace it to ensure there is suitable redress for landlords if the tenant doesn’t pay the rent?

Of course, a handful of Crediton landlords will decide to sell their rental portfolio because of the White Paper. The same happened in 2016 when the increase in landlord taxes were announced. 

However, this will reduce the supply and availability of Crediton rental properties, meaning rents will rise (classic textbook supply and demand), thus, landlords return and yields will rise.

Yet, because tenants still can’t afford to save the deposit for a home and we are all living longer, the demand for rental properties across Crediton will continue to grow in the next twenty to thirty years. The reason being is we are still not building enough homes to accommodate our growing and ageing population. This means we will turn to more European ways where the norm is to rent rather than buy in their 20s and 30’s.

This means new buy-to-let landlords will be attracted into the market, buy properties for the rental market in Crediton and enjoy those higher yields and returns. Isn’t it interesting that things mostly always go full circle?

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Is the Crediton Property Market Running Out of Steam?

In recent articles on the Crediton property market, I have been talking a lot about house prices over the last 12 months and 5 years in Crediton.  

When it comes to newspapers talking about the property market, the headline most people look at is what is happening to house prices.

However, as 2 in 3 (65.1%) of Crediton home sellers are also home buyers, the price is almost irrelevant. Let me explain.

If your property has gone down in value – the one you want to buy has also gone down in value – so you are no better or worse off (and if you are moving up market – which most people do when they move home – in a suppressed property market the gap between what yours is worth and what you will buy gets lower … meaning you will be better off).

Many property commentators (including myself) consider a better measure of the health of the property market is the transaction numbers (i.e. the number of people selling and buying).

Let’s take a look at the numbers for Mid Devon as a whole (including Crediton).

The average number of properties sold in Q1 (Jan/Feb/March) between 2008 and 2020 was 84 properties per month, whilst Q1 in 2021 saw 141 properties sell on average per month (boosted by the March stats where an eye watering 169 homes sold). This meant …

67.4% more houses sold in the Crediton area in Q1 2021 than the 14-year average

The average number of properties in Q2 (April/May/June) between 2008 and 2020 was 98 properties per month, whilst Q2 in 2021 saw only 84 properties sell on average per month, meaning …

14.1% less houses sold in the Crediton area in Q2 2021 than the 14-year average

Finally, whilst the exact stats for Q3 2021 for our local authority won’t be published by the Land Registry for a couple of months, I can make certain calculated assumptions from the national data published by HMRC. The number of property sales for our local authority area in Q3 (July/August/September) between 2008 and 2020 was on average 113 properties per month. However, using the HMRC data, I calculate there will only be 87 properties sold on average per month in Q3 2021. This means …

22.9% less houses sold in the Crediton area in Q3 2021 than the 14-year average

I wanted to then look at the month-by-month statistics for our local authority for the last 12 months (up to June 2021). As you can see, there have been some interesting months in terms of housing transactions 

One of the two main drivers of activity in the housing market in the latter half of 2020 (meaning Q1 figures were better than the long-term average) was the battle for space, with many Crediton buyers seeking larger properties to work from home. The second was the short-lived tax relief measures such as the cut to Stamp Duty Tax meaning property prices were at an all-time high.

But what also might surprise you is the number of people buying for the first time.

1 in 4 mortgages since lockdown have been for first-time buyers (25.12%)

Crediton first-time buyers, buoyed by parental help with their deposits, the Government’s 5% deposit mortgage and ultra-low borrowing costs, have also helped to push house price growth since the start of 2021. In fact, if you split down house price growth between second time (third time etc) buyers and first-time buyers, the national annual house price inflation for first-time buyers is 9.2% compared to 8.1% for the second or third etc buyers. 

Yet, the Q2 and Q3 2021 Crediton property market was worse than the long-term Crediton average (in terms of property transactions)

The question is – should we be worried?

The UK economy continues to deliver a benevolent framework to the British housing market. 

The labour market has outstripped expectations with the millions expected to join the dole queue at the end of furlough failing to materialise and with the number of job vacancies on the rise.

Of course (and I mentioned a lot in my recent posts), the Bank of England is projected to increase interest rates to dampen inflation in the coming months, with further small rises predicted over 2022, so I do expect the demand for property to cool off as mortgage borrowing costs increase. 

Normally such rises in mortgage costs would mean less property would sell, yet nothing over the last couple of years has been normal.

Many Crediton property homeowners have held back putting their property on the market in the last 6 months because they were afraid, they would sell their own home but not find another to buy – thus making them homeless (nothing could be further from the truth – yet that is what a lot of people incorrectly believe).

If the Crediton property market slows and interest rates rise, mortgage costs will still be very low by historical standards.

Also, if the obstacle of raising the 5% deposit can be overcome by first-time buyers plus a confidence that existing homeowners won’t be made homeless because of a cooling property market, many more people could be tempted to enter the property market by placing their property for sale first …

… thus opening up the market to more buyers – which in turn will drive up transaction numbers back to their normal 14-year average. However, raising a deposit is likely to remain the primary obstacle for many.

If you are a Crediton homeowner or first-time buyer and want my thoughts on the future, then please do drop me a line.

2022 is going to be an interesting year ahead for the Crediton property market – only time will tell if this will be a brief respite or is it running out of steam?

Please tell me your thoughts on what you think will happen.

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Would You Re-mortgage Your Crediton Home to Help Your Child Onto the Property Ladder?

How far would you go to help your child get on in the world?

Many Crediton parents move area to ensure their child gets into the best primary school or fund their university costs. Many of you reading this have even helped your children with the deposit for their first home from savings.

However, I have come across many Crediton people in their 50’s and 60’s who have good jobs and incomes, yet don’t have the savings to give to their children to help them buy their first home. It doesn’t help when you consider…

the average value of a Crediton home has risen by 10% in the last 5 years, from £286,752 to £315,535.

I am therefore seeing increasing numbers of parents who are willing to re-mortgage their own Crediton home or start a new mortgage (when they own their Crediton home outright) — to get their children onto the Crediton property ladder.

So, whilst the Government is trying to turn Britain’s 20 and 30 somethings from ‘Generation Rent’ into ‘Generation Buy’, the Bank of Mum and Dad are mortgaging their retirement to pay for it all. Yet it need not be cost prohibitive borrowing the deposit as you still have access to interest only mortgages.

With an interest only mortgage, your monthly mortgage payment covers only the interest on your mortgage, not any of the original capital borrowed. This means your mortgage payments will be lower than on a repayment mortgage, remembering though at the end of the term you will still owe the original amount you borrowed from the mortgage provider.

1 in 14 new mortgages are interest only and 1 in 5.5 existing mortgages are interest only mortgages, they are very popular.

Anyway, many Crediton homeowners might be worried about having that level of debt in their golden years. However, many plan to pay off the mortgage when they downsize as they get into their 60’s and 70’s.

I talk to many Crediton homeowners, who are asset rich but cash poor and desire to help their children onto the Crediton property ladder. Their attitude is their children will inherit their property when they pass away, so it seems practical to give them that money to work harder for them earlier in their life when they need it to buy their first home.

Can you get a mortgage, even if you are retired?

A lot is dependent upon your age and financial position. The mortgage companies will see if you have adequate funds for your retirement and emergencies plus leaving enough equity in the property to enable you to downsize in the future. Like all things, you need to take advice from a qualified mortgage arranger.

So, that then begs the question, is there enough equity in Crediton homes to borrow against?

In the late 1980s and again in the early 2000s, many Brits saw their homes as a cash machine. Numerous homeowners re-mortgaging at the end of their mortgage’s preliminary term (usually after the initial 2, 3 or 5 years), but when doing so increased their mortgage to enable them to buy a nice car or fancy holiday. Yet, by increasing the borrowing, it created negative equity in the early 1990s and stopped many homeowners moving home between 2009 and 2013 because of their lack of equity.

Therefore, I have to ask, have we borrowed too much this time round?

Looking at Crediton and the specific postcodes EX17 combined…

In 2016, the average Crediton homeowner had a mortgage of £91,106 and today it is £104,370, a rise of £13,264.

Looking at these numbers, one might think we are again over-extending ourselves, yet as regular readers of my blog about the Crediton property market will know – I like to drill down and look at all the figures.

Initially, I was worried about these stats, until I considered the equity Crediton people have amassed over the same 5 years.

In 2016, the average equity held in a Crediton homeowner’s property (whilst still having a mortgage) was £195,646, yet today that stands at £211,165, a rise of £15,519.

Even though mortgages have increased, Crediton homeowner’s equity has risen even more, meaning as we stand today, mortgaged and owned-outright properties, there is…

£2,304,544,131 of equity held in all Crediton homes.

Whilst the total value of mortgages has increased slightly since 2016, as a percentage, this has gone down meaning Crediton homeowners and Crediton landlords have increased their equity in the last five years.

It can quite clearly be seen that the financial insecurity sparked by the Credit Crunch crisis of 2008/9 has created a generation of Crediton homeowners and landlords who are savers and improvers rather than movers and excessive borrowers, using excess cash to invest in their property and pay down debt or to excessively borrow on their equity growth.

Only 12.3% of the total value of Crediton property is borrowed money with a mortgage.

This is great news for every Crediton homeowner and Crediton landlord because irrespective of whether the ‘Post Lockdown Bounce’ is short or long-lived, it shows the Crediton property market is in a better state to ride out any storm that it might encounter than ever before because less people will be in negative equity or have prohibitively high mortgages.

Before I finish, I fully appreciate money and inheritance is a sensitive subject for many families.

My message to all the Crediton parents is, just because your children aren’t talking about the subject, it doesn’t mean it’s not on their mind.

The lead has to come from you, as a Crediton parent to ensure the wealth held in your bricks and mortar can be used to your family’s advantage, when they need it most.

If you do, your children will thank you for it and they may even do exactly the same for their children, then, they will do the same for their children’s children … creating a legacy that will go on for generations.

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Crediton Homeowners to Face Post-Lockdown Mortgage Rate Rise of £678 a Year

With grocery, energy and other household prices/costs rising and hitting everyone’s back pocket, inflation (rising prices) may feel like an unimportant issue when it comes to the cost of keeping a roof over your head.

Yet nothing could be further from the truth for many Crediton homeowners and Crediton landlords.

Because inflation over the long term is bad for the economy, the normal weapon of choice to reduce inflation is to increase interest rates. The Bank of England (BoE) is in charge of interest rates.

Should inflation continue to rise, there will come a point later in the year when the BoE will need to raise it’s Base Rate from its 300-year record low of 0.1%, and probably continue to do so with a series of further increases in 2022.

When interest rates go up, the cost of mortgages go up. When the cost of mortgages go up, that hits the affordability of what people can borrow to buy their homes (and landlords to finance their buy-to-let properties). In essence…

could it be the end of the Crediton house price boom?

The danger of a base rate rise by the BoE on the back of a rise in inflation over the last few months has alarmed banks and building societies into increasing the mortgage rates for both home buyers and landlords.

In the last week alone, lenders have increased the rates (i.e. prices) of their mortgages, some mortgages by more than one whole percentage point. That doesn’t sound a lot, until you punch the numbers into a calculator (more of that later).

Crediton property buyers (be they landlords or homebuyers) have relished months of cut-price cheap mortgages rates.

Mortgage lenders have played the big game in the last 12/16 months to capture the mortgage business of 1 million+ Brits that have moved home since the end of Lockdown-1 plus the many millions of re-mortgages, with the cheapest mortgage rates falling below 1%.

Yet, the money markets have already priced into their calculations that the BoE will increase the base to 0.25% by December, up from the existing 0.1%. They also anticipate a further two quarter point (i.e. 0.25%) rise in the spring of 2022, meaning they believe the base rate will be 0.75% by the end of summer 2022.

So why is this an issue for the homeowners of Crediton? Looking at the combined totals of the EX17 postcode districts…

2,710 Crediton property owners have mortgages totalling £282.84m (up from £252.07m in 2013).

Yet, 569 of those Crediton homeowners with mortgages are on variable rate mortgages, with their mortgage payments rising and falling based on how the BoE interest rate shifts. That will cause instant pain if mortgage providers pass on increased mortgage repayment costs. So how much will that be?

The average size of mortgage for a Crediton homeowner is £104,370.06.

If the base rate were to rise to 0.75%, the average Crediton homeowner (with a variable rate mortgage) would be £57 per month worse off (£678 per year).

The mortgage price war the banks and building societies have been fighting recently has resulted in falls in the month-on-month average mortgage rates available to borrowers. The economy is awash with cash looking for a home (mainly down to the Government’s and BoE’s intervention to keep the UK economy going during lockdown). For those with large deposits this has meant mortgages have been available at less than 1%.

However, with reports of a potential BoE interest rate rise happening soon, those Crediton homeowners who are on a variable rate mortgage are probably going to be the first who would feel the influence of any base rate increase.

If the BoE Base Rate rose to 3%, the average annual mortgage payment of those Crediton homeowners on variable rate mortgages would rise by £3,131 per year.

This could mean homeowners with variable rate mortgages would be spending half their salary on their mortgage should interest rates get up to these levels.

Now the BoE won’t increase rates by that amount over night, as that would spook the market. They will probably increase every few months by a quarter of one percent each time.

Thankfully, over the last 4 or 5 years, over 90% of new mortgages have been fixed rate, yet they are only fixed for a certain length of time. If you have less than one/two years left on your mortgage, you seriously need to take advice now from a qualified mortgage broker, as any penalty to change might now be considerably smaller compared to the mortgage rates you might be paying when your deal finishes in the next 12/24 months. Again, I am not giving you advice in this article – just making a suggestion.

A further message to the 1 in 5 (ish) of Crediton homeowners on a variable rate – please take some advice from a qualified mortgage advisor as well. Mortgage rates can’t get any lower and all the signs are showing they will be going up. The mortgage market is still extremely competitive, there is opportunity for borrowers to lock in ultra-low mortgage rates before any likely Base Rate increases filter through.

Will an interest rate hike crash the Crediton housing market like the early 1990s?

The early 1990s saw repossessions go through the roof as homeowners defaulted on their mortgage payments because of the increased mortgage rates. Also, in the run up to the Credit Crunch in 2008, Northern Rock were lending 125% of the value of the property (we all know what happened to them!). Other banks were recklessly lending 8 or 9 times a person’s income, without the person having to prove that income. Both scenarios were significant contributory factors in the housing market crash.

Thankfully in 2014, the BoE implemented the recommendations of its own Mortgage Market Review (MMR). The MMR forced banks and building societies to stress test mortgage borrowers against potential increases of the base rate of up to 3%. Thankfully, even the most hardened monetary doom-mongers aren’t contemplating base rates of those levels (although I won’t apologise for highlighting what it could cost earlier in the article).

Fundamentally, as we go into 2022, the housing market is built on decent foundations, unlike 2007 with the poor lending practices by the lenders. Yet the increase in base rates will have another influence.

The psychological factor of a perceived increase in mortgage costs, might be enough to cool the enthusiasm and excitement of many buyers to pay top dollar for their next Crediton home, and that might not be a bad thing. If I am being frank, we could do with something that takes a bit of fizz out of the Crediton housing market.

Many Crediton homeowners have been wary of placing their house on the market because they are scared they won’t be able to find another home. A slight increase in Base Rates will take the frothiness out the Crediton property market and return it to some form of normality. I would even go as far as to say house prices might ease back ever so slightly in the coming 12 to 18 months.

So dont be alarmed if house prices in Crediton do drift slightly over the coming years like they did in the mid 1990s.

It’s just the property market settling down and coming back into some form of equilibrium, which is good for everyone.

My final thoughts…

The mortgage lenders have already priced in the potential BoE rate rises, so even if rates do rise, let’s not panic. And even if they did rise to 3%, that would still leave them at levels that look exceedingly cheap at any other time in history. Many homeowners in their 50’s and 60’s can remember mortgage rates of 15% in 1992, so take advice from your family. (Interestingly, the 50-year BoE Base Rate average is 7.2%).

Buying your Crediton home is a long-term venture. It is a huge financial decision that can give you peace of mind and a superb place to live.

But it is not an investment. I am not saying you should avoid homeownership, however, if you are considering buying because you think you are making a clever investment choice, think again.

The idea that your Crediton family home can be an investment too comes from the fact that, historically Crediton property prices have risen. We all have stories of someone in the family, somewhere in the UK, who bought a house for £500 many years ago, for it to be worth 300% / 500% / 1000% more today!

If you read some of my past articles on the Crediton property market, I have proven many times over, there are much better ways to invest your money, e.g. buying buy-to-let properties or stocks and shares.

But if you want to bring your family up in a home that is yours, the bottom line is this. Even if interest rates rise to 3% (if not a little more), you will still be able to get on the property ladder with a small deposit (using the Government’s 5% deposit mortgages) and you will still find it’s cheaper to buy than rent.

If you would like to chat to me about anything in this article, do drop me a line. In the meantime, please do give me your thoughts on the matters raised in the article – I would love to know.

Thanks in advance.

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Has Buy-to-Let Changed the Crediton Property Market?

The ‘Buy-To-Let’ (BTL) mortgage is celebrating its Silver Anniversary (25 years) this autumn.

Isn’t it fascinating that a decision between a group of letting agents and bankers all that time ago to offer ‘Buy-To-Let’ mortgages has changed the face of the Crediton (and national) property market?

But has it been a good thing? Or has it ruined the dreams of many 20 somethings wanting to get on to the property ladder in the last couple of decades?

Let’s look deeper at the whole story, then I will let you, the reader, decide.

As soon as the BTL mortgage was launched, it was clear there was an enthusiasm and a need for this mortgage product. So much so the size of the Crediton private rented sector has grown exponentially.

According to my analysis…

there are 608 private rented homes in Crediton, worth £194,260,000.

So now we are in 2021, it seems farcical that banks and building societies once thought that properties rented out to private tenants would not create a steady income or increase in value, yet this thought was conventional back in the 1990s.

It’s no wonder BTL landlords have been given a hard time, with numbers like this.

Yet before we burn every landlord at the stake, let’s just look at the background story.

The Conservatives introduced the right of a council house tenant to buy their own council house in the early 1980s. Fantastic news for council tenants, yet when a council tenant bought their home, that meant that council housing was taken away from future generations to rent and therefore eroding the council housing stock available. Meaning from the mid 1990s /early 2000s, people who would normally be eligible to rent from the council, yet who couldn’t buy, had only one option … rent from a private landlord.

Meanwhile, in the early/mid 1990s we had 15% mortgage interest rates, unemployment rates of 9% and the 1989 housing crash fresh in people’s memories. Repossessions were rife, making home ownership not the most attractive prospect for 20 somethings.

Crediton house prices dropped by 28.8% between 1989 and 1993.

This meant as we entered the mid 1990s, the Crediton property market entered a period of stagnation. There were many Crediton homeowners that bought their home in the property boom of the late 1980s who were disinclined to sell their home for a loss. They were in negative equity (i.e. they owed more than what the house was worth) yet needed to move because of their growing families.

Renting their home out could have allowed them to buy another home for their growing family, but most banks and building societies were still mostly unreceptive to the notion of these homeowners becoming accidental landlords. Most mortgage terms and conditions usually included clauses that prohibited homeowners from renting out their homes.

So, with growing demand from potential tenants, supply reduced from the sale of council houses and many homeowners in negative equity, all bound up by the semi-deregulation of the private rented sector with the Housing Act 1988 – you can see that the BTL mortgage came along at the right time.

Early take up of BTL mortgages was slow in the first couple of years.

By the Millennium, according to the Council of Mortgage Lenders, there were just over 120,000 BTL mortgages, with a total value of £9.1 billion.

Yet as we entered the 2000s, they really took off, with every man and his dog jumping onto the BTL bandwagon. So much so that today in the UK, there are…

4.4m private rented homes, 2.1m of them with BTL mortgages totalling £234.1bn, which is 11.9% of the UK’s GDP!

That’s more than a 1,650% increase in the number of BTL mortgages to landlords and a 2,470% increase in the value of those BTL mortgages.

Since 2001, the number of privately rented households in the UK has grown from 8.3% to 19%.

On the face of it, you could say with the growth of these BTL landlords with their cheap BTL mortgages and often unkempt properties, it has pushed potential homebuyers into squalor. Yet, let’s look a little deeper.

Most Crediton landlords are very fair with their Crediton tenants providing them with clean, well presented and affordable housing. Of course, there are the rogue landlords but with TV shows such as ‘Landlords from Hell’, the British public are given a distorted and uneven view of private landlords as a whole.

Private sector landlords have played a critical role in providing homes to millions of Brits in this country, let me expand.

The UK population has grown by 405,000 people per year (for the last 20 years), yet only 22,750 council/social houses have been built per year in the same time frame.

If it wasn’t for the rented sector, who would have housed all the extra people in the country over the last 20 years? 

What about the exorbitant rents? Would it surprise you that rents have risen below inflation between 2008 and 2019?

Also there has been a drive to tax BTL landlords more comprehensively and regulate the private rented sector to develop better housing conditions for tenants.

Unlike owner-occupier homes, tenants get the benefit of new regulations from Gas Safety Checks and Electrical Safety Reports. Also, BTL landlords will need to improve their Energy Performance Certificate Rating to at least a C rating by the end of 2025 for all new tenancies, and by end of 2028 for all existing tenancies, all at no cost to the tenant and directly saving them money on their heating costs – something that is very important considering the recent rises in gas prices.

Crediton landlords have also had to pay more tax on their Crediton BTL properties, paying 3% Stamp Duty Tax supplement for the last 5 years, and higher rate tax relief on mortgage interest was taken away four years ago.

Landlords have also had to deal with the financial fallout of the pandemic. It is estimated 1 in 5 tenants in the private rented sector have some form of rent arrears.

Interestingly landlords that dont use a letting agent to manage their property are 272.5% more likely to be 2 months or more in arrears.

Also, evictions for rent arrears were banned during the pandemic, meaning some tenants ran up arrears of 12 months or more. According to the National Residential Landlords Association (NRLA), this has left around 210,000 private tenants in the country facing a court order for rent arrears. That would equate to…

33 Crediton private rented households with a court order for arrears.

The idea that Crediton landlords are middle-class establishment types who are out to take advantage of Crediton tenants who can’t afford to buy their own Crediton homes is, in my opinion, just wrong.

Of course, there are some rogue Crediton landlords, yet there are plenty of rogue tenants. Just because you are a Crediton landlord, it doesn’t mean you are quaffing champagne and rolling in cash.

109 Crediton landlords own just one BTL property.

And just under half of those use their rental income to supplement their pensions, and according to the NRLA, a third of landlords have a gross income (excluding income from the BTL property) of less than £20k per annum.

Its hard work being a Crediton BTL landlord and I still believe the burden of housing just under a fifth of the UK population isn’t appreciated or taken seriously by Government.

Notwithstanding the challenges, most Crediton BTL landlords are in it for the long run. BTL mortgages can be secured for less than 1% and demand is on the rise (with rents rising at the highest rate for 10+ years). Of course, Brexit caused a few issues with some Crediton landlords losing some Eastern European migrants. Yet once things settle down, we will have an influx of people coming from Hong Kong and Afghanistan, wanting to settle down, get jobs and ultimately require a home to live in, which will be a private rented house.

I know the Stamp Duty Tax holiday has cleared out the Crediton landlords who were on the fence for staying in the private rented sector or selling up, but those Crediton landlords that are left will be more professional and will run their BTL portfolio as a business, not a hobby.

My final piece of advice to anyone thinking of becoming a BTL landlord in Crediton for the first time is that you have to have a strategy and plan ahead. Those who stumbled into the BTL market in the early 2000s made a lot of money without any strategy or tactics.

Moving forward you need the guidance and support of an agent who can tell you the best places for investment, be that for better yield or better capital growth.

They will also be able to tell you what tenants demand to ensure that you attract the right sort of tenants who won’t trash the place and leave you in arrears. If you would like some advice, do not hesitate to drop me a line or pick up the phone.

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Are Crediton House Prices Set to Fall this Autumn?

The stamp duty holiday is over, furlough finished at the end of September, unemployment is due to rise and inflation is rife … is this the end of the post lockdown Crediton property boom?

Surely, we are heading for house price correction?

Forecasting what will happen in the Crediton property market this autumn may not be as simple as it first appears.

It’s true the Crediton property market is starting to settle down after an all-time number of property deals were completed in June.

More Crediton people will have moved home in 2021 than in any year since 2007, with an estimated 1.5 million home buyers nationally having bought a property.

Roll the clock back to last Christmas, and the Government’s Office for Budget Responsibility, projected that national house prices would drop between 6% and 8%.

By Christmas, the price of an average home in Crediton will be about £260,300, up 4.8% on last Christmas.

Let us not forget there were so many ambiguities at the start of 2021. We were about to start a 5-month lockdown, hospitals were bursting at the seams with patients, the vaccines hadn’t started, 4 in 10 employers had furloughed their staff and we had just had Brexit … things didn’t look good.

Yet, nothing could be further from the truth 10 months later – the Crediton property market has been on fire. But after a heated summer in the Crediton property market, things certainly can’t carry on as they have been since the end of lockdown.

So, where are we with the Crediton property market as it stands? Taking reference from historical data on the website The Advisory (I would certainly recommend you check it out) …

76% of properties on the market today in Crediton are sold subject to contract (stc).

How does this compare to October 2019 and October 2017?

In October 2017, 47% of Crediton properties were sold stc, whilst in October 2019, 44% of properties were sold stc.

Yet how does that compare to the national picture?

In 2017, 39.72% of the country’s properties for sale were sold stc whilst in 2019, that figure was 38.11%.

Now I love a good league table, so then decided to compare our locality to the rest of the country.

So, I chose to look at the EX17 postcode specifically. For information, there are 2,234 postcode districts in the country.

The 2021 sold stats put EX17 in at 364th place in the country, 635th in 2017 and 668th in 2019 … meaning we have improved from the 2017 and 2019 figures.

As we enter the last 3 months of the year, there are not so many uncertainties as there were at the start of 2021. On the good news front, 49 million Brits have had at least one jab (45m two jabs) and the UK will be the world’s fastest growing advanced economy this year according to the IMF.

Conversely, the furlough scheme ended at the end of September and with energy prices going through the roof, a real shortage of homes for sale (as I have discussed a number of times in recent blogs) and rising inflation on the back of a shortage of raw materials and trained staff, forecasting this and what will happen to Crediton house prices might not be as easy as it seems.

Post stamp duty holiday, it is now recognised that the majority of the demand for people moving home is focused by a profound unhappiness and frustration with the homes we live in, revealed during the first lockdown in 2020.

Buyers (and tenants – so take note Crediton buy-to-let landlords) want space … in fact, three types of space … and they will pay handsomely for them!

  • Office space (be that bedroom or study)
  • Outside space (gardens or proximity to green areas)
  • Broadband with ‘outa-space’ download speeds

And whilst there is a shortage of properties coming on to the market, demand and supply economics mean …

Crediton house prices should remain relatively stable going into 2022.

The number of properties coming onto the market in Crediton is slowly improving, yet not enough to diminish house values.

Also, don’t forget Crediton first-time buyers still have stamp duty relief all to themselves again and mortgages are cheap. At the beginning of the 2020 lockdown (Spring 2020), mortgage providers removed their higher risk 5% deposit mortgages for fear of a housing market crash. Currently, the vast majority of these low 5% deposit mortgages are back, together with the Governments own 5% deposit mortgages.

Yet many Crediton homeowners are concerned about inflation and its effect on their mortgage payments.

Inflation is important because if inflation gets too high, the Bank of England will need to raise interest rates to reduce inflation. Because mortgage payments are based on the Bank of England interest rate, higher mortgage payments will affect what people can afford. Normally the higher the mortgage rate, the less likely house prices are to increase (and in fact if interest rates are too high, house prices will fall).

Whilst I can’t give you advice, with the Bank of England base rate at a 300-year historic low of 0.1%, I’m still surprised that nearly 3 in 10 Crediton homeowners with mortgages are not on a fixed rate mortgage. There has never been a better time to get a fixed rate mortgage, as there are deals out there with interest rates as low as 1%. This means even if interest rates do go up in the short term, you will be protected from higher mortgage costs. Anyway, back to inflation.

Inflation did rise quite quickly and steeply in 2008/9 but came back down within a year.

This was because of a shortage of staff and raw materials during the Credit Crunch of 2008/9, the very same issues we are experiencing at the moment in Q4 2021. The type of inflation (yes, there are types of inflation!) in 2008/9 was called ‘push inflation’. Whilst inflation is not great, ‘push inflation’ could be described the better type of inflation (as long as is it doesn’t go on for too long).

The economic crippling hyper-inflation seen in the 1970s was ‘pull inflation’. The circumstances that create ‘pull inflation’ are not being experienced at the moment buy in the UK. This is good news because ‘pull inflation’ is bad inflation, which in turn would create massive problems to the UK economy as a whole.

Therefore, whilst inflation will probably rise to 4% – 5% by Christmas, I don’t believe the Bank of England will raise interest rates substantially as the message we are hearing from them is they see this as a short-term blip.

Opportunities for Crediton buy-to-let landlords?

Ultra-low mortgage rates and a booming rental market is encouraging more Crediton buy-to-let landlords to expand their rental portfolios, yet their strategy is changing. Yields are increasing as there is a shortage of rental properties, driving up rents. Also, there are Crediton landlords looking to exit the rental market, often because they want to liquidate their portfolio for retirement. These portfolios don’t make it onto Rightmove and get sold ‘off market’.

Therefore, if you are a serious Crediton buy-to-let landlord and you’re looking to expand your own portfolio, it’s really important to put yourselves on the mailing list of estate agents and also build up great one-to-one relationships with the same agents to ensure that you’re at the front of the queue for these off market rental portfolios and not at the back.

To conclude, nobody knows the answer to what will happen to the property market in Crediton as we go into 2022. There are many factors that could affect the market in a positive and negative way, yet buying property is always a long-term investment (be it for yourself or to rent), so if you need any advice or opinion on what you should do, drop me a line or pop into the office and we can discuss the options you have over a cup of coffee.

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Crediton Homeowners to be Made Homeless?

The number of properties for sale in Crediton has fallen by 9% since this time two years ago (October 2019). One of the reasons is that many Crediton buyers feel overwhelmed and fearful they will be made homeless if they sell their home and can’t buy another. So, I have decided to look again at the facts and give them to you in greater detail in this article.

My research has found the number of Crediton properties for sale started to decline last autumn (2020).

Nationally, the same story is being written as the average UK estate agency office now has around 16 properties on their books to buy, compared to 43 a couple of years ago.

So why is this an issue?  Many Crediton homeowners are wanting to move home and are worried they will put their current home on the market, it sells quickly and then be unable to find another home to buy – thus they believe they will then be making themselves homeless.

The fact is that most Crediton home buyers need to sell before they can buy their next home, meaning they need to place their property on to the Crediton property market before they can buy their next home.

Yet because of the low supply of properties for sale and the current high demand, there is an imbalance in the Crediton property market. This means some Crediton house sellers are nervous to put a ‘for sale’ board outside their house.

So, let me look at the Crediton numbers in greater detail. According to the three main property portals (Rightmove, Zoopla and On-The-Market) …

In October 2019, there were 66 properties for sale in Crediton. Today, there are only 60 properties for sale, a reduction of 9%.

When I break it down into bedroom numbers and type it gets even more interesting (note things like building plots and part commercial/part residential etc., won’t be in these numbers so the stats below won’t precisely match up to those above).

 # Properties on the Market in Oct 2019# Properties on the Market in Oct 2021Percent Change
5+ Bedrooms14300%
  4 Bedrooms2317-26%
  3 Bedrooms212310%
  2 Bedrooms1312-8%
  1 Bedroom63-50%

… and when I looked at the type of properties … it got even more interesting…

Type of Property# Properties on the Market in Oct 2019# Properties on the Market in Oct 2021Percent Change
Detached2413-46%
Semi1910-47%
Terraced75-29%
Flat136-54%

As you can see, there have been some interesting changes in the number of properties on the market in Crediton over the last few years, depending on the type and the number of bedrooms, yet all types of housing are down considerably.

So, if Crediton homeowners do sell, will they be made homeless if they can’t find their next ‘forever home’?

The answer is quite simply … NO!

Crediton properties are coming on to the market all the time, yet the buyers have got to be in the game, in it to win it so to speak. If you keep looking at properties, without even having your property on the market, let alone sold (subject to contract), then you will fall into a self-fulfilling prophecy of not being able to buy another home and will always be chasing your tail.

And it’s those magic words of “subject to contract” that are your get out of jail card.

The average time taken from agreeing a sale to it being legally binding (i.e. exchange of contracts) is about 19 weeks.

During those 19 weeks, you are ‘sold subject to contract’, which means you have four or five months to find your new home and the likelihood of not finding your next forever home is very small.

And even if you can’t find anywhere, you will never be homeless as the sale is not legally binding until you exchange contracts, so you can withdraw from the sale up to that point, without penalty.

One final word of advice to all Crediton home movers.

Around 6 in 7 Crediton homebuyers could have missed their ‘forever home’ in 2020/21

Let me explain, in a study of various UK estate agents, 84.8% of homebuyers were not on the estate agent’s mailing list before they contacted the agent to view the home according to Denton House Research.

Yes, 6 out of 7 buyers (84.8%) waited until the property came on to the market on one of the portals (e.g. Rightmove, Zoopla or On The Market) before asking to view it. But would it surprise you that depending on the location and type, up to one in five houses don’t actually make it on to the portals for sale.

This means if the homebuyer hadn’t registered themselves on the agents mailing list, they would’ve missed out on their ‘forever home’, because they would not have known the property was for sale until it was too late.

Quite simply, if you are serious about moving home in Crediton, get yourself on the mailing lists of all the agents in Crediton.

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Wages rising by 8.3% pa – how will this affect the Crediton property market?

As they struggle to meet demand, Argos have had to increase the wages of their HGV drivers from £11.41 an hour to £15 an hour – a rise of 31.2% meaning their pay goes from £27k to £35k. Care home providers are offering signing-on bonuses of many thousands of pounds to entice nursing staff away from their competitors, and new homes contractors say labour costs are growing as the housing boom pushes up demand for bricklayers and joiners. Restaurant chains, coffee shops, blue-collar workers in factories and warehouses are seeing wages rise at an extraordinary rate.

The average wage for a worker in Crediton in full-time employment is £530.30 per week (before tax).

We can all argue over the reasons behind it; some suggest the ‘B’ word (ending in ..xit), whilst others put it down to the pandemic and some the demographic changes of UK population.

So, before I look at what it could do to the Crediton property market, let me look at why wages are rising. You will note all the above inflation wage increases are in blue-collar industries.

(Blue-collar workers refers to any worker who engages in physical or manual labour, such as building, hospitality, maintenance etc., whilst white-collar workers are those classed in the professions and service industries).

What are the reasons for these wage increases?

  1. In the past, the demand for inexpensive ‘blue-collar’ labour has been fed by a steady supply of Eastern European workers since 2004. Yet with the ‘B’ word, that has now ended.
  • Also, even in late July, the furlough scheme has kept 1.9 million Britons from their jobs.
  • Fewer ‘Generation Z’ (those in their late teens to mid 20’s) who normally would work in the hospitality industry are not working at the same rate they used to, when compared to before the pandemic.
  • And finally, fewer ‘Baby Boomers’ (those born before 1965) are working since the end of the first lockdown.

How could these wage increases affect the Crediton property market?

White-collar wages, since the turn of the millennium have risen in real terms yet blue-collar wages have remained stagnant (although they started to pick up slowly just before the pandemic).

So, if all blue-collar workers are now seeing a substantial increase in their real wages since the pandemic what will this mean, especially for the Crediton property market? It would mean the following …

  1. Continued reduction in unemployment
  2. Growth in consumer spending
  3. Rents will continue to rise in the short term
  4. Rise in homeownership in the medium term

Starting with unemployment:

640 Mid Devon people have come off the dole queue in the last 12 months alone, reducing the unemployment rate by 1.5% to the current 3.4% in our local authority area.

If wages continue to grow for everyone, that means unemployment will continue to reduce.

Secondly, these pay rises will start to burn holes in people pockets. We should assume those people with the extra cash will spend it. In fact, it is a recognised trait in economics that blue-collar workers tend to spend a lot more of any increase in disposable income (when compared to white-collar workers). This would give a boost to the retail, hospitality, leisure and travel industries very quickly.

Crediton rents are already 11.5% higher than 12 months ago,

and if wages continue to grow, then rents will increase even further. This is because rents in the private sector tend to rise in line with wages rather than with property prices.

This is excellent news for Crediton buy-to-let landlords.

Next, if wages for blue-collar workers continue to grow, I believe we will finally see a long-term growth in home ownership again. In 2008, 68% of people owned their own home, yet that had been slowly reducing over the 2010s to 63% in 2018. Yet since 2018, this has increased slightly to 65%.  

The Brits who had the biggest problem jumping on to the property ladder were not just the 20 somethings, but also middle-aged blue-collar workers. With blue-collar wages stagnant over the last two decades, and accelerating house prices, it was much tougher for them to save up a deposit for a mortgage.

Yet with the recent Government backed 5% deposit mortgages and more disposable income (because of the wage rises), some might decide not to spend the extra on going out and holidays and buy their first home instead (because most people want to own the place where they live – if they can afford it, they will buy).

Overall, if this increase in blue-collar wages is across the board, then this could be one of the greatest things to happen to the Crediton property market in a long time.

It is certainly long overdue. Since the millennium, wages at the bottom end of the pay scale (i.e. blue-collar workers) have deteriorated, while the professional white-collar middle classes have done much better. The disparities between both classes/workers are both imbalanced and harmful to the economy and society as a whole.

But what is the real story behind the headlines?

One school of thought is that some fear these wage increases will fuel hyperinflation (and in turn, interest rates will have to rise to counter that).

As I have mentioned many times in my articles on the Crediton property market, the last thing we need is a rise in interest rates (as mortgage rates will increase accordingly). A rise in interest rates will put a massive brake on the Crediton property market – which is not good for anyone.

Also, we have to remember a few things …

there are still 1.9m people on furlough (which stops at the end of September).

Not all of those people will go back to their original jobs, meaning they will need to find a new job, so the pay pressures could just as easily diminish as employment bottlenecks clear.

Also, the 8.3% wage increase is based on a year-on-year figure (i.e. a snapshot of now versus a year ago) and therefore the headline figures have been profoundly distorted by the large numbers of blue-collar workers on furlough in 2020 (i.e. they were on 80% pay). The Office for National Statistics have gone on record saying that, accounting for some of the distortions caused by the pandemic, real wages for blue-collar workers are more likely 3.5% up.

Finally, as with all things, the devil is in the detail. The newspaper headlines reporting the over inflated pay rises this spring are true. However, in truth (of course we all know bad news sells newspapers) these wage rises were focused on professions with specialist skills. For example, whilst wages for HGV lorry drivers have risen by double digits, pay rates for courier drivers have remained stagnant. At the same time, wage growth for white-collar jobs is almost at zero for yet another year.

To conclude, there are interesting times ahead for everyone involved in the Crediton property market. I do not profess to know all the answers, however, I do have my own opinions. Whether you are a Crediton first-time buyer, second-time buyer, homeowner, landlord or tenant and would like to pick my brains on any aspect to do with the Crediton property market, please do not hesitate to drop me a DM, give me a call or send me an email.

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Crediton Buy-to-Let Market on the Rise as Returns Rise by 35.2% in 5 Years

Crediton landlords are becoming progressively more self-assured about expanding their rental portfolios; as Crediton rents rise, mortgage interest rates fall and demand for decent Crediton rental properties outstrips supply.

A number of reports nationally would suggest around a third of UK ‘portfolio’ landlords (i.e. landlords with more than one rental property) are actively looking to expand their rental portfolios in the next 12 to 18 months, that would locally mean …

81 Crediton ‘portfolio’ landlords are looking to add to their rental portfolio by the end of 2022.

The pandemic has had a substantial change to what we want from a home. Many people think that relates just to homeowners, yet nothing could be further from the truth as it also applies to tenants.

Homeowner or tenant, many of us have spent a lot of time away from places of work. Many office workers face the outlook of the combination of working from home as well as at the office, meaning a change in what people look for in their home. People (including tenants) are looking for larger properties, with extra rooms for office space and decent sized gardens or to be closer to outside green space.

So, let’s look at the ‘scores on the doors’ as to why Crediton landlords are on the up …

Crediton house prices are 17.5% higher than 5 years ago.

Because some Crediton first-time buyers are being priced out of the market due to these house price rises, they are being forced back into the rental market. Add the extra demand of the 1 in 10 Crediton house sellers who, in the last 12 months, have had to go into rented accommodation instead of buying, and this has created increased demand, meaning …

Rents today in Crediton are 11.5% higher than a year ago and 17.7% higher than 5 years ago. The average rent of a Crediton property today is £700 pcm.

In previous articles on the Crediton property market, I was talking about the lack of properties to buy – yet that issue is also there in the British rental property market. Now let’s look at the supply of rental properties.

Would it surprise you that the number of private rented homes in the UK has fallen in the last 12 months by just over 2.5%?

Why? One reason has been many ‘accidental’ landlords have used this housing market to sell their property for a good price. That means the supply of available rental properties has decreased. The perfect storm of increased demand and lower supply, and with many Crediton tenants competing for those larger Crediton homes, they may find Crediton rental prices pick up even more over the next year.

What about buy-to-let mortgages for Crediton landlords?

The banks all but withdrew from buy-to-let lending in the first lockdown. Yet, since last summer things have settled down and during 2021 there has been a mortgage price war.

Crediton landlords can borrow 60% of the value of their BTL property on a two-year fixed rate of 1.18% from Platform and even those with a 20% deposit (that’s borrowing 80%) can borrow that money at 2.49% 2-year fixed rate from The Mortgage Works. Those looking to fix for a little longer can get 1.44% from The Mortgage Works and 1.79% at 75% loan to value from Santander.

(It must be noted there are some fees to these mortgages, and you must take advice from a qualified mortgage advisor before deciding which mortgage is best for you).

So, is now the best time to invest in Crediton buy-to-let property?

If you are attracted to invest in Crediton buy-to-let, it’s vital to do your homework first – particularly if you are new to the game.

When estimating the expected rental returns on investment, capital growth and yields, many Crediton landlords look to what has happened with house prices and rental prices, yet past performance does not always deliver a future guaranteed return.

Smart Crediton landlords will speak with agents like myself and others in Crediton, prudently researching the Crediton property market to discover what types of properties are in high demand (and short supply) from tenants.

Whether you are a landlord of ours or not, please feel free to drop me a line via email or social media for no nonsense advice on the important matters to look out for before investing in Crediton buy-to-let.