There I was, out with the family at Manor Farm and Country Park last weekend, when a smart gentleman approached me. “Hello”, he said, “You are the person writes that Property Blog aren’t you? We have met before at that Business Networking event in Locks Heath a few months ago”. I did then recognise him and, whilst I won’t mention his name, he runs a small but perfectly formed well known independent retailer in the suburb … It’s amazing who you see when out walking! Anyway, I was at a loose end for five or ten minutes as the other half was sorting things with the family, so we had a chat.

He wanted to know my thoughts on the future of the Locks Heath property market, and I would now like to share with you that conversation, my Locks Heath property Blog reading friends. People are always going to need a roof over their heads and somewhere to live will never go out of fashion – it’s a necessity for every single person. The 22 to 30 year olds of the suburb have a choice as to what type of roof they have … they rent from the Council, they can rent from a private landlord or finally they can get a mortgage and buy one. In the 1970’s/80’s and 90’s, the expected thing was to save like mad for two years for the deposit (going without luxuries) whilst living at home or renting a cheap two up two down, then buy your first house. However, more recently fewer Locks Heath youngsters have been buying, choosing to rent instead – mainly from private landlords (as Councils have been selling off council housing on the Right to Buy Schemes). The numbers are truly staggering … and I want to share them with you.

Roll the clock back 20 years and Locks Heath was a different place. There were 33,894 households in Fareham and 27,895 of those were owner occupied. Move to the present, and with all the building in the suburb, the total number of households has increased by 19.6% to 40,548 and quite surprising (to me at least), the number of owner-occupiers has increased to 32,391 (although as a proportion, it is only 79.8% compared to 82.3% twenty years ago).

However, it’s the rented sector that is truly fascinating … twenty years ago, only 1986 properties were privately rented in Fareham … and now its 4113, a rise of 2127.

The twenty-somethings of Locks Heath housing difficulties haven’t been helped by the local authority selling off council housing, with the number of council houses dropping from 2,740 to 2,124 over the same twenty-year period. Demand for decent rented property remains high, as Cameron’s much vaunted house building program is years away and has decades of under investment to catch up on before it starts to affect demand. Even with the Buy to Let tax rule changes over the coming few years (which will see the maximum tax relief available to landlords drop from 45% to 20%), private landlords still have an important role to play in housing the people of Locks Heath and those who educate themselves and treat it as a business will survive and prosper.

The best way Locks Heath landlords can protect their income from property (and mitigate the affects of the tax rises) is to keep the homes they let out in Grade A condition. I have found, especially over the last three or four years, Locks Heath tenants have ever growing demands from their rental property, but many are prepared to pay ‘top dollar‘ for houses and apartments that meet their high expectations. You must not forget, letting property in Locks Heath (in fact anywhere) is a business, so all private landlords should also seek the advice, opinion and commentary of property professionals.

… And just as the other half had sorted the family, he asked “What of the news of Stamp Duty changes for Landlords coming in April?” My thoughts are with such low supply (i.e. numbers of property for sale), and high demand it is hard to imagine Locks Heath property values will see much impact – but I predict, ever so slightly, the proportion of owner occupiers should increase slightly compared to buy to let landlords in the coming decade as the the housing market should return to balance. For more in-depth thoughts on the Locks Heath Property Market, which have a library of similar articles like this, all on the Locks Heath Property Market, please visit my blog – www.thelocksheathpropertyblog.co.uk

As January draws to a close the race for property in Locks Heath and surrounding areas is in full swing.

Investors that are keen to beat 3% Stamp Duty hikes must complete on their Buy to Let property purchases prior to 1 April 2016.  This, together with first time buyers also looking for similar properties has created a frenzy of activity which is set to continue for a little while longer.

The most currently sought after are one and two bedroom properties between £110,000 and £250,000.  These appeal to the first time buyer market as well as investors and the competition has forced prices higher and also meant that these properties are currently in short supply.

So if you are still keen to purchase a property prior to the April deadline but are struggling to find something what can you do?

Recently on the increase is trading between Landlords.  We are currently progressing sales of managed investment properties between existing Landlords and potential investors.  The big bonus with these transactions is that for the new owner there is no stress of finding a Tenant to coincide with the completion date as the properties all have Tenants already in residence on fixed term contracts.

You can all be told what an Agent thinks a property may rent out for when you are handed the details but with this type of transaction I can actually show you exactly what the property is making and give you a brief synopsis of the Tenant.  This puts you in a far better position to know what lies ahead.

I still have Landlords who are willing to trade on their properties with Tenants in place so if you wish to discuss the options in more detail please call me on 01489 570011 or email me at james.hill@brooklettings.co.uk.

 I met with an existing Landlord this week who wants to buy another property to let and is keen to do so before 1 April.

As many investors are trying to do the same there is limited choice available in the one and two bedroom market that is going to give the type of return that they are looking for.
The average price of a two bedroom property in SO31 is now £229,700. The average rental is around £795pcm meaning that the yield for this type of property is now 4.15%. The Landlords looking at the short term return rather than the capital growth over a longer period are therefore starting to look at other options.

The average price of a one bedroom property in SO31 is currently £147,500. The average rental is around £625pcm meaning that the yield for this type of property is now 5.08%. This still makes one bedroom properties attractive propositions for Landlords.
One avenue I explored with my existing Landlord was the option of buying a larger property and converting it to an HMO to give him a better return. The average three bedroom property in SO31 is currently £302,100. To rent out the three bedrooms separately at £500pcm with communal use of the other areas would give an attractive return of 5.96%.

Naturally there are some expenses involved in making sure the property complies legally and obtaining a license from your local authority. But the option of an HMO could be one worth looking into if you want a decent annual return on your investment.

If you are thinking of investing in a Buy to Let property whether you are an existing Landlord or doing so for the first time please contact me to discuss on 01489 570011 or james.hill@brooklettings.co.uk.

You can obtain more information on HMO licensing in the Fareham Borough here:http://www.fareham.gov.uk/licensing_and_inspections/environmental_polution/hmolicensing.aspx

As expected it has been a very busy start to 2016 and the number of investors coming into the office has risen considerably.

I saw a couple this week who have decided to try and beat the rise in Stamp Duty coming in April and invest in a Buy to Let property.  They asked me what I thought was the best type of property to buy to maximise the return on their investment.

We started by looking at two bedroom freehold properties which was their preference when we started speaking.  Two bedroom houses in Locks Heath have risen to the £200,000 mark and with a projected rental income of around £795 pcm this would give a return of 4.77%.

We compared that with this one bedroom leasehold flat which is currently on the market for £110,000.  This has a Tenant moving in tomorrow on a six month fixed term contract paying £525 pcm.  Even taking the annual management charge of £680 in to account this property would give a return of 5.10%.

Two bedroom properties being in short supply in Locks Heath has forced asking prices up and they are no longer looking such great investments for those Landlords wanting a decent yield.  The investment above therefore looks a fantastic option.

If you are thinking of investing in a Buy to Let property and would like some advice please come in and see me at our office in Middle Road, Park Gate or call me on 01489 570011.

When the news broke that Stamp Duty is set to rise in April 2016 inevitably there were gasps from Landlords and Letting Agents across the country.  Questions were asked locally whether or not this would kill the buy-to-let market in the Western Wards.

The reality, however, is that more prospective investors have come through my door in the last 10 days than I can care to remember in recent years.  Not only have I had many conversations with a lot of my existing Landlords who are considering adding to their portfolios prior to April. But interestingly I have spoken with many first time Landlords who have made the decision to dive in off the back of George Osborne’s announcement three weeks ago.

Of course this mini-stampede will most likely only continue until the new rates come in to force.  But the feedback I have been receiving, especially from my established Landlords, has been positive.  After all stamp duty has always been factored in to these Landlords’ yield calculations anyway.  Most of them will diversify with their investments when the deadline passes if the yields become unattractive.

The best deal I have seen this week for those active Landlords is a one bedroom apartment in Park Gate which is currently let out at £725pcm.  The current owner would trade at £145,000 with the Tenant remaining in residence.  With minimal monthly maintenance charges of £85, and factoring in the current stamp duty, the net yield works out at a fraction over 5%.

Whilst we are all still slightly unsure exactly how much impact the changes will effect buy-to-let investment in Locks Heath and the surrounding areas after April. One thing we can be sure of is that the next four months are set to be a busy time.

If you would like some advice about buying to let, whether you are an established Landlord or someone thinking of investing, please come in and see me at our office in Middle Road, Park Gate or call me on 01489 570011.

A first-time landlord came to see me at our office in Park Gate this week. He lives in Locks Heath and having recently heard about the planned changes to Stamp Duty for Buy-To-Let Landlords in April 2016 has decided to invest sooner rather than later.  He asked my opinion on where he should buy a Buy-To-Let property.

As with a lot of investors this Landlord is keen to buy in a similar area to where he currently lives so has been thinking about Locks Heath, Park Gate and Titchfield Common as potential locations.

We looked at these three current Buy-To-Let deals in those areas to explore which area would work for him:

A one bedroom house with a conservatory and gas central heating in Locks Heath which is on the market for £165,000 and would let at around £695pcm giving a gross yield of 5%.  When you also consider that this property has increased in value by 15% in the last 18 months this certainly looks like an attractive purchase.

The second property is a modern ground floor two bedroom apartment in Park Gate.  This is on the market for £175,000 and would achieve a rental income of £750pcm.  This gives a gross yield of 5.14%.  The property is less than 10 years old so there is unlikely to be too much maintenance to factor in to the calculations.

Lastly we looked at a studio flat in Titchfield Common which is on the market for £107,950.  A monthly rent of £495pcm in good condition would give a gross yield of a handsome 5.53%.

We found all three areas that the Landlord was looking at as potential locations to be equally good for investment.  All give good returns with some giving better capital growth than others.  So it is now down to him to make his decision prior to 1 April 2016.

If you would like some advice about buying to let, whether you are an established Landlord or someone thinking of investing, please come in and see me at our office in Middle Road, Park Gate or call me on 01489 570011.