It seems that quite a few Locks Heath homeowners and Locks Heath Landlords have become acclimatised to living with the uncertainty of Brexit throughout most of 2019, as figures show many of them decided to get on with living life, started reinvesting their money into Locks Heath property and buying and selling their Locks Heath homes and BTL investments. Land Registry stats confirm that. Current data shows that…

Locks Heath property values are 1.6% lower than 12 months ago

Whilst the newspapers were stating prime central London property values were now 17% below the levels being achieved a couple of years ago, that message seems not to have been heard by certain sectors of the Locks Heath property market!

Speaking with other property professionals in Locks Heath, many weren’t expecting the usual autumn rebound after the summer holidays.  Many were anticipating a dormant Locks Heath property market on the run up to Christmas believing many Locks Heath home-movers would put off the their home moving activities until the new year.  Yet in many sectors of the local property market, I have seen (and the stats back this up) that those Locks Heath property buyers who are able to hold their nerve (whereas others were hesitant) have found themselves in a better negotiating position to get a great property deal.  Putting aside the fluff of newspaper headlines, the real foundations of Locks Heath housing market remain sound with record low unemployment, ultra-low interest rates and low inflation.

Interestingly, there are 17% more homes for sale in Locks Heath (SO31) compared to two years ago, meaning more choice for buyers

However, there are still parts of the Locks Heath property market that remain stagnant, with some homeowners being slightly unrealistic with their marketing pricing.  To them, the property market appears to be slow, as they stare at their ‘for sale’ board for months on end, yet nothing could be further from the truth.

The key to a balanced (and healthy) property market is realistic pricing by the homeowners when they place the property on the market, mortgage affordability for buyers and buy to let Landlord activity which creates and maintains forward momentum.  One measure of momentum is how long a property remains on the market, and interestingly…

The current average length of time a Locks Heath (SO31) property remains on the market is 91 days, up slightly from 80 days two years ago

Now the number of properties sold locally is slightly down year on year (even though we had a burst of property sales in the summer locally) and interestingly, Rightmove reported recently that nationally, the number of properties sold in the UK was only just over 3% less year on year, so a similar picture nationally.

So, what does all this mean for Locks Heath homeowners and Locks Heath Landlords?

We have always had issues that were game changers for the housing market; for the last few years it’s been Brexit, 10 years ago the credit crunch, 18 years ago the dot com crash, the ERM and 15% interest rates issue 27 years ago, dual MIRAS 32 years ago, hyper-inflation 40 years ago, the 3 day week 45 years ago – the list goes on.  Everyone needs a home to live in, the local authority just has not got the money to build council houses, so buy to let will continue to grow for the foreseeable future which in turn creates a stable foundation for all homeowners.  Maybe you should use this time, like many are in Locks Heath to take advantage of the property deals to be had in Locks Heath.

Investing in a Locks Heath buy to let property has become a very different sport over the last few years.

In the glory days of the five years after the turn of the Millennium, where we had double-digit house price growth, mortgage companies (notably Northern Rock, HBOS and their ilk) desperate to get on the buy to let mortgage bandwagon with rates so low it would make the belly of a snake seem high, and an open mildness to give loans away with not so much more than a note from your Mum and with hardly any regulatory intervention… anyone could make money from investing in property.  In fact it was easier to make money than fall off a log!  Then we had the unexpected flourish of the property market, with the post credit crunch jump in the property market after 2010, when everything seemed rosy in the garden.

Yet, over the past five years, the thumbscrews on the buy to let market for British (and de facto) Locks Heath investors have slowly turned with new barriers and challenges for buy to let investors.  With the change in taxation rules on mortgage relief starting to bite, plus a swathe of new rules and regulations for Landlords and mortgage companies, it cannot be denied that some Locks Heath landlords are leaving the buy to let sector, whilst others are putting a pause on their portfolio expansion.

With the London centric newspapers talking about a massive reduction in house prices (mainly in Mayfair and Prime London – not little old Locks Heath) together with the red-tape that Westminster just keeps adding to the burden of Landlords’ profit, it’s no wonder it appears to be dome and gloom for Locks Heath Landlords.… or is it?

One shouldn’t always believe what one reads in the newspaper.  It’s true, investing in the Locks Heath buy to let property market has become a very different ball game in the last five years thanks to all the changes and a few are panicking and selling up.

Locks Heath Landlords can no longer presume to buy a property, sit on it and automatically make a profit

Locks Heath Landlords need to see their buy to let investments in these tremulous times in a different light.  Before Landlords kill their fatted calves (i.e. sell up) because values are, and pardon the metaphor, not growing beyond expectation (i.e. fattening up), let’s not forget that properties produce income in the form of rent and yield.  The focus on Locks Heath buy to let property in these times should be on maximising your rents and not being preoccupied with just house price growth.

Rents in Locks Heath’s private rental sector increased by 0.19% in the past 12 months

Rents in Locks Heath since 2008 have not kept up with inflation, it is cheaper today in REAL TERMS than it was 11 years ago and some landlords are beginning to realise that fact with our help.

Looking at the last few years, it can be seen that there is still a modest margin to increase rents to maximise your investment (and it can be seen some Locks Heath Landlords have already caught on), yet still protect your tenants by keeping the rents below those ‘real spending power terms’ of the 2008 levels.

Buy to let must be seen as a medium and long-term investment….

Rents in Locks Heath are 4.29% higher than they were 3 years ago and property values are 14.10% higher than Jan 2016

… and for the long term, even with the barriers and challenges that the Government is putting in your way the future couldn’t be brighter if you know what you are doing.

Investment is the key word here…  In the old days, anything with a front door and roof made money – yet now it doesn’t.  Tenants will pay top dollar for the right property but in the right condition.  Do you know where the hot spots are in Locks Heath, whether demand is greater for 2 beds in Locks Heath or 3 beds?  Whether terraced houses offer better ROI than semis?  With all the regulations many Locks Heath Landlords are employing us to guide them by not only managing their properties, taking on the worries of property maintenance, the care of property and their Tenants’ behaviour but also advising them on the future of their portfolio.  We can give you specialist support (with ourselves or people we trust) on the future direction of the portfolio to meet your investment needs (by judging your circumstances and need between capital growth and yields), specialist finance and even put your property empire into a limited company.

If you are reading this and you know someone who is a Locks Heath buy to let Landlord, do them a favour and share this article with them – it could save them a lot of worry, heartache, money and time.

Irrespective of the shenanigans and political goings on in Westminster recently, the housing market (for the time being anyway) shows a striking resilience, fostered by the on-going wide-ranging monetary policy by the Bank of England. With interest rates and unemployment low, UKplc is heading into 2020 in reasonable condition.  Additionally, despite the UK’s new homes industry improving its year on year new build figures (building 173,660 new homes this year to date – notably 8% more new homes than at the same time last year), there has been an unequal increase in demand for housing, especially in the most thriving areas of the Country.

With the discussion on whether the younger generation can afford to buy, it is true the average cost of a UK property in the early 1970’s was 3.8 times the average salary yet, nationally, it now stands at 8.4 times. On the face of it that doesn’t look good in anyone’s books – yet that isn’t the full story because it doesn’t reflect inflation and interest rates when it comes to the cost of borrowing money in relation to a mortgage for property.

The current level of mortgage interest rates has not been seen for many generations, meaning there are whole cohorts of the Locks Heath home-owning population who have no appreciation of the pandemonium that will eat into their household budgets should we ever return to the average historical cost of borrowing (interest rates jumped to 15% in 1992 – which wasn’t that long ago and between 2003 and 2007 they were on average 4.9%).

Now, once first-time buyers have jumped the hurdle of saving enough for a 5% deposit, which is hard with rents and many carrying loans of personal debt (unsecured loans), first-time buyers are currently spending an average one sixth of their salary on their mortgage, meaning mortgage arrears are at historical lows. However, on the other side of the coin repossessions have started to grow, with 6,180 repossession orders made in the last quarter, a 55% jump from 2017, yet nowhere near the 2009 high of 29,145 in the first quarter of 2009.

Therefore, this week’s discussion on the Locks Heath property market is – where are we with lending (mortgages and unsecured loans) and how is it affecting the Locks Heath, and national, property market?

One vital measure of the property market (and economy) is the mortgage market. If all the mortgages were added up, they would total £968.1bn; a lot when you consider the UK’s GDP is only £2,190.1bn. Mortgages are important as uncertainty causes building societies and banks to curtail lending (remember what happened in the Credit Crunch) and that seriously affects property prices. Then we have unsecured personal loans; interestingly the average Brit owes £991.42 in unsecured loans, a total of £36.1bn.

Lending is the lifeblood of our economy. Go back to 2007, and the phrase ‘Credit Crunch’ hadn’t been invented, yet now the term has entered our everyday language. In the autumn of 2007 it took a couple months before the crunch began to affect the Locks Heath property market, but in early 2008, and for the following year and half, Locks Heath property values dropped each month like a stone.

Mercifully, after a phase of sluggishness, in 2011 the Locks Heath property market started to recover slowly as certitude returned to the economy as a whole and in 2012 Locks Heath property values started to rise as the economy sped upwards. Happily, the Bank of England recognised the start of another boom and bust cycle, so in Spring of 2015, new rules for mortgage lending were introduced and for the following few years we have seen a reappearance to more credible and steady medium-term property price growth.

Locks Heath Property Values are 46.6% higher since the Credit Crunch

And what of the other side of the coin in terms of excess lending in Locks Heath?

Since 1977, the average Bank of England interest rate has been 6.65%, making the current low rate of 0.75% very low indeed. Yet the issue isn’t the amount of lending, as much as the persons ability to pay. Therefore, whether a person’s mortgage is fixed or not is more important than the amount owed.

Thankfully, the proportion of borrowers fixing their mortgage rate has gone from 31.5% in the autumn of 2012 to the current 70.2%. If you haven’t fixed your mortgage – maybe you should follow the majority?

The total cost of mortgages owed by people in Locks Heath is £1,028,077,294

(Based on the SO31 postcode)

In my modest opinion, if things do get a little rocky and uncertainty seeps back in the coming years (and nobody knows what will happen on that front), interest rates can only go one way from their current ultra low level of 0.75% ….and that is why I consider it important to highlight this to all the homeowners and Landlords of Locks Heath. Maybe, just maybe, you might want to consider taking some advice from one of the many qualified mortgage advisors locally?

If you are interested in the Locks Heath Property Market The Locks Heath Property Blog is worth a visit.

That number surprised you didn’t it? With the General Election done, I thought it time to reflect on renting in the manifestos and party-political broadcasts and ask why?

As the best way to tell the future is to look at to the past, so we decided to look at the number of people who rented a century ago (1920’s), and surprisingly 76% of people rented their home in the UK (as renting then was considered the norm). Yet in the latter part of the 1920’s, builders of the suburban housing estates with their bay fronted semis started to sell the dream of home ownership to smart renters.

Up until the mid 1920’s, the mortgage had been seen as a millstone around your neck. Now, due to some clever marketing by those same builders, it was started to be seen as a shrewd long-term investment to buy your own home with a mortgage. It fuelled the ambitions and goals of the up and coming well-to-do working class who reclassed themselves as lower-middle class. Meanwhile, the Government encouraged (through tax breaks) people to save in Building Societies whom in turn lent the money to these up and coming new homeowners thorough mortgages.

Roll the clock forward to the decade of the young Elvis, Chuck Berry, and Bill Haley (1950’s) and still 72% of Brits rented their home. Homeownership had boomed in the preceding 30 years, yet so had council house building. Then, as we entered the 1960’s and 1970’s homeownership started to grow at a higher rate than council housing.

The rate of homeownership started to drop substantially after the mid 1990’s, and now we roll the clock forward to today, there is no stigma at all to renting … everyone is doing it. In fact, of the…

42,795 residents of Locks Heath, 7,538 of you rent your house

from either the council, housing association or private Landlords – meaning 17.6% of Locks Heath people are Tenants. Yet read the Daily Mail, and you would think the idea of homeownership is deeply embedded in the British soul?

34,657 Locks Heath people live in an owner-occupied property (or 81%)

So, we have a paradox – homeowners or renters? The reason I suggest this, is, I noticed on the run up to the Election that housing was used at the General Election as way to get votes. This is nothing new, as all parties have always used housing to get votes, although previously it was about which party would build more council houses in the 1950’s through to council Right to Buy with Thatcher (and everyone since) – running election campaigns promising everybody their own home in one way or another.

Yet, did you notice at this election something changed? The parties weren’t talking so much about increasing homeownership but about protecting the Tenant. It seems the link between homeownership as the main goal of British life is starting to change as we are slowly turning to a more European way of living. Renting is here to stay in Locks Heath and incrementally growing year on year. You see, in Britain there is no property tax based on ownership, which many other western countries have. Instead Council Tax is paid by the occupier of the home (meaning the Tenant pays – not necessarily the owner).

Both parties wanted to end no-fault evictions, yet Labour went further and mentioned rent controls in their manifesto. As I have mentioned before in other articles on the Locks Heath property market, rents since 2008 (even in central London) have not kept up with inflation – so again was that another headline to grab votes/election bribe? The fact is the majority of new British households formed since the Millennium can now expect to rent from a private Landlord for life – therefore the parties focus on this important demographic.

Yet even with the new mortgage relief tax rules for Landlords and the 200+ of legislation that govern the private rental sector, buy to let is still a viable investment option for most investors in Locks Heath. There has never been a better time to purchase buy to let property in Locks Heath … but buy wisely. Gone are the days when you would make a profit on anything with four walls and a roof. Most importantly do your homework, take advice and consider your options.

In the late spring, the Government announced that they were planning to end no-fault evictions for tenants living in private rented accommodation.

I have had a number of Locks Heath Landlords contact me anxious that removing a Tenant from their Locks Heath buy-to-let property in the future had possibly become a lot more problematic. Yet, at the launch of the consultation on the changes to the piece of legislation relating to no-fault evictions (called the Section 21 amendments), the Government wanted to assure British Landlords that they would be protected by the bolstering of the existing Section 8 legislation. The current Section 8 allows Landlords grounds for recovery of their properties for reoccupation of the Landlord, non-payment of rent and other legitimate factors.

2,104 Locks Heath landlords are affected by this potential change in the law

Yet, it is comforting for Locks Heath Landlords and Tenants in the fact that most competent Letting Agents very rarely have to evict a Tenant. In the worst-case scenarios the Tenant needs evicting (normally because rent hasn’t been paid) or because the Landlord is either selling their buy-to-let investment or moving back into their property. Look at the consultation – it has been indicated that those grounds will not be removed from section 8 powers during the government’s consultation and the talk is they will be bolstered and improved. To put the removal of Section 21 notices into some context…

Only 22,527 Section 21 notices made it to Court last year, out the 4.5million private rented households

Scotland banned no fault evictions (i.e. their own version of a Section 21) two years ago, and the model suggested by Westminster is similar to that of the new Scottish system. Landlords, Tenants and Agents have had to adapt north of the border, and there hasn’t been the mass exodus of Landlords from the market since then.

Yet the call in the lettings and legal profession is… if the Government is intent on making these changes, we need well-funded courts which specialise in housing and tenancy matters (like there are for family law and children). Especially when the Landlord manages the property themselves (without an Agent), the issue of eviction comes about from a breakdown in communication between Landlord and Tenant. The courts could use their mediation skills to make it simpler and faster for Tenants and Landlords to obtain quick and available justice instead of the existing drawn out procedures under Section 8, which helps no one (not even Tenants). This is important as the demand for Locks Heath rental properties is growing and people need a home to live in – fact.

Locks Heath needs an additional 100 buy-to-let properties per year for the next decade to meet the demand from Locks Heath Tenants

As an agent in Locks Heath, I know most Locks Heath Landlords consider buy-to-let in Locks Heath as a long-term investment, with the average Landlord looking to retain their buy-to-let property for at least 10 years and beyond. Talking to other Agents around the country, over 90% of Section 21 notices are made by the Tenant, not the Landlord. Removing the Section 21 notice could affect Tenants more than Landlords.

Replacing Section 21 with a process that requires a Landlord to firstly have a good reason, and secondly go through due process, will likely remove the more unprincipled Landlords from the property market. That is great news as those unprincipled Landlords will either sell their properties to new buy-to-let Locks Heath Landlords, or to Tenants who want to buy them. So, it could be a small win for people looking for a new Locks Heath home, and a disappointment for unprincipled Landlords simply looking for a cash cow ‘have no care about the property or Tenant’ investment vehicle.

If you are a Locks Heath Landlord and want to know more about this, whether you are a Landlord of ours, a Locks Heath Landlord with another Agent or a self-managing Landlord, feel free to drop me a line or pick up the phone (I don’t bite) to chat about the implications of this and other legislative changes that are on the horizon.

Many mature readers of this Locks Heath property market blog will remember buying their first home as 20 or 30 somethings, probably in Locks Heath many years ago, yet read the newspapers now and feel it is all doom and gloom for todays’ first-time buyers.

So, I wanted to look at the facts, instead of newspaper headlines.

Back in 1995, the average Locks Heath first time buyer’s house cost £43,890, whilst official figures state today it is £179,700

So, looking at today’s property prices, it could be perceived that owning a home is beyond the reach of most Locks Heath first time buyers and that renting is the only way for younger members of Locks Heath society to have a roof over their head… or is it?

100% mortgages (so no deposit needed to be saved) were rife in the 2000’s and Northern Rock were famous for their 125% mortgages (i.e. you borrowed 25% more than what you were paying for the house, again with no deposit). Yet when the credit crunch hit in 2008 such mortgages disappeared overnight – ending the dream of homeownership for many. Yet would it surprise you to hear that 95% mortgages (i.e. the first-time buyer would need to save a 5% deposit) have been available since late 2009 and 100% mortgages (i.e. no deposit) were made available in 2016.

It is £166 per month cheaper to buy a typical Locks Heath first-time buyer home than to rent the equivalent property.

Prospective Locks Heath first-time buyers could make a saving of £1,991 per year on average if they moved from renting to owning. My calculations assume that first-time buyers raise a deposit of just 5 per cent and make mortgage payments over 35 years with the Barclays 95% mortgage with a fixed interest rate of 2.48 per cent interest. At this level…

Today, the average deposit needed by a Locks Heath first-time buyer is £8,985

Those able to raise that deposit, would pay £633 pm on average in mortgage payments, while the average rent for the same property would be £799 pm and the household income to support such a mortgage would only need to be from £37,937 pa.

Of course, buying your first home is a massive financial commitment and investment with up-front costs to ponder on, yet long-term the financial benefits can be substantial. With annual savings of £1,991 a year, this can really mount up over time and, of course, once the mortgage is paid off, one will have a valuable asset.

Yet, the elephant in the room is the raising of the 5% deposit

Well most first time buyers, even most of you who are now in your 50’s and 60’s may have used the Bank of Mum and Dad to help with the deposit, yet it’s only fair that most parents still expect their offspring to contribute to the deposit and this is where it comes down to choice. I have spoken to many of my friends and family to reconfirm my initial thoughts that it comes down to priorities and choices in life. To save the deposit mentioned above, sacrifices are required to save that amount of money.

According to a survey in 2018, the average millennial goes out two nights a week and spends on average £63.36 per night out, that’s nearly £6,600 per year – a very expensive hobby. Nearly a third of millennials surveyed had smashed their mobile phone in the last 12 months. Then there is the obsession of having the latest tech, with the need to constantly be upgrading one’s mobile phone. In fact, the cost of the brand new iphone 11, recently released, is just shy of £900. Even those on contracts can expect to pay upwards of £80 per month for the newest phone upgrade, yet if they kept their old phone after two years, a sim only deal with the same minutes and data would set them back no more than £25 per month… it comes down to choices. Save for a deposit and reduce your expenditure on socialising and mobiles etc and have a valuable asset at the end of your mortgage or continue as you are.

I am not here to make a judgement – everyone is free to make their own choices in life.  All I am doing is highlighting the real situation so you are aware of the full story.

Of the 23,500 houses and apartments sold in Locks Heath (SO31) since 1995, 2,700 of those have been new homes, representing 12.4% of property sold. So, I wondered how that compared to both the regional and the national picture… and from that, the pertinent questions are: are we building too many new homes or are we not building enough?

Roll the clock back a few years and in 2013 the Government expressed its disappointment that, as a Country, builders weren’t building enough new homes to house our citizens.  They promised to hasten new homes building to the fastest rate since the 1980’s when the Country was building on average 168,100 private households a year.  The Housing Minister stated he wanted the private sector to build in excess of 180,000 households a year, a figure which seemed unachievable at the time.  In 2013, private house building was in the depths of a post Credit Crunch dip, with just 96,550 private new homes being built that year.  Yet, in the five years since then, private new-build completions have climbed steadily, rising by 59.5% to 154,100 new home completions in 2018. So on appearances alone, whilst the growth is impressive, the new homes builders haven’t met their targets….. or have they?

In addition to the 154,100 new homes completions in 2018, the private sector also provided an additional 29,700 new households gained from change of use between office, industrial and agricultural buildings to residential homes meaning, last year, the private sector created 183,800 new households.  When we look at the public sector, there were 30,300 Housing Association new homes and 2,950 Council houses built last year, meaning after making a few other minor adjustments, the total number of new households/dwellings created in the UK in 2018 was 222,190.

Most of the growth can be credited to an improving economic framework, though continued help for first time buyers with the Help to Buy Scheme has enabled some younger buyers to bypass the issue of saving for a large deposit for a mortgage when buying a home, thus supporting confidence among new home builders to commit to large building schemes. Yet there is more to do.  The Government wants the Country to return to the halcyon days of the 1960’s where, as a Country, we were building 300,000 additional homes a year – and they want that to happen by 2025, a 36% increase from current levels.

In 2019, the country will create 257,500 households, so we are on our way to meeting that target but maintaining this level of house building will be a test.  Even the Governments’ Auditors (the Office of Budget Responsibility) is predicting net additional dwellings will plateau at about 240,000 in the first few years of the next decade.

So, how does Locks Heath sit within this framework?

The UK currently has 27.2m households, of which 2.45m (9%) of those have been built since 1995, whereas in Locks Heath, of the 21,600 households in SO31, 2,700 were built since 1995 (representing 12.5% of all households), meaning Locks Heath has a higher proportion of new homes building in the last couple of decades than the national figures.

I certainly feel there is an over reliance on the private sector to meet the Country’s housing needs.  Local Authority’s need to step up to the plate and build more houses, and its true central government has released more cash for them to do just that, but probably only 20% to 25% of what is required.  In the meantime, unless the Country starts to build 300,000 households a year, property prices will retain and improve their value in the medium to long term – which is good news for Locks Heath Landlords and Locks Heath homeowners.

Over the last 5 years we have seen some interesting subtle changes to the Locks Heath property market as buying patterns of Landlords have changed ever so slightly.

The background to this story was the recently published set of buy-to-let (BTL) lending statistics. Roll the clock back 12 months and 6,700 BTL mortgages were granted (in the same month) for £900m, meaning the average BTL mortgage was £134,200. Looking at last month’s figures, and as one might expect with the Brexit issue overhanging the property market, the lending figures were down, yet not by the amount I originally thought. Last month, just over 6,100 new buy-to-let mortgages were granted for a total sum of £800m (meaning the average Landlord mortgage was a respectable £131,100). Yet, when I looked back to the boom year of the 2014 property market, in the corresponding same month, only £1,030 million was borrowed on 8,300 buy-to-let properties (meaning the average buy-to-let mortgage was £124,100). It seems Brexit is having no effect on Landlords buying habits.

Looking closer to home in Locks Heath, throughout 2019 I have been regularly chatting to more and more Landlords, be they seasoned professional Locks Heath BTL Landlords or FTL’s (first time Landlords) and their attitude is mostly positive. Instead of reading the scare-papers (oops sorry, newspapers), those Locks Heath Landlords that look with their eyes, will see the Locks Heath property market is doing reasonably well, with medium term rents and property values rising; as quite obviously from the mortgage figures… Landlords are still buying.

The question I get asked all the time is “What type of buy-to-let property should I buy?”. You can make money from property through both the rent (expressed as a yield when compared to the value of the property) and how the actual value of the home itself changes.

Since 2014, property values in Locks Heath have risen by 26.6%.

We have records of what each type of property (i.e. Detached/Semi/Terraced/Apartments) has achieved per square metre going back 20 years, and looking back over the last 5 years, these are the numbers:

	2014 Locks Heath Average Value £/Sq.M	Current Locks Heath Average Value £/Sq.M
Detached	£2,479	£3,101
Semi Detached	£2,562	£3,279
Terraced	£2,574	£3,291
Apartments	£2,391	£2,959

They all look to have similar percentage uplifts, however as you can see from the table, there is in fact some variation throughout and although only slight this can equate to thousands of pounds in monetary terms.

Price Changes in Locks Heath in Last 5 years by Type
Detached	25.1%
Semi Detached	28.0%
Terraced	27.9%
Apartments	23.7%
Overall Average	26.6%

This has proved that semis and terraced houses have performed the best, although like the £/Sq.M figures, these are just averages. When investing, whilst Locks Heath apartments haven’t been the best performers in terms of capital growth, they do tend to generate a slightly 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.

Now these are of course averages, but it gives you a good place to start from. The bigger picture here though is this – irrespective of what is happening in the world, be it Brexit/no Brexit, China, Trump, whatever, Locks Heath people still need a roof over their heads and we as a Country haven’t built enough homes to keep up with the demand since the late 1980’s. This means even if we have a short term wobble in 2019 when it comes to property values, in the medium term, demand will always outstrip supply and prices and rents will increase – because, I doubt the local authority, let alone Westminster, have the billions of pounds required to build the one hundred thousand Council houses per year nationally for the next decade to fix this issue.  This means as the population increases, the only people who can fulfil the demand for accommodation in the medium term is the private BTL Landlord.

Before I go, on average, housing associations and local authorities have built around 26,500 houses each year since 2010. The Labour government had a lower average, building about 19,000 homes per year, yet in the 1960’s, under both administrations, 180,000 councils were built per year!

With the Government preparing to control Tenants’ deposits at five weeks rent, Locks Heath Landlords will soon only be protected in the event of a single month of unpaid rental-arrears, at a time when Universal Credit has seen some rent arrears quadrupling and that’s before you consider damage to the property or solicitor costs.

It can’t be disputed that the deposits Locks Heath Tenants have to save for, certainly raises the cost of renting, putting another nail in the coffin of the dream of home ownership for many Locks Heath renters.  Whilst at the same time, those same deposits being unable to provide Locks Heath Landlords with a decent level of protection against unpaid rent or damage to the property.

In fact, the total of all the Tenants’ deposits in Locks Heath, deposited or protected, is £2,080,595

When you consider the value of all the privately rented properties in Locks Heath total £872,704,998, the need for decent Landlord insurance to ensure you are adequately covered as a Locks Heath Landlord is vital.

However, I want to consider the point of view of the Locks Heath Tenant.  Several housing charities believe spending more than a third of someone’s salary on rent as exorbitant, yet for the Tenants they find themselves in that very position.  I feel especially sorry for the Locks Heath youngsters in their 20’s who want to rent a place for themselves, as they face having to pay out the rent and try and save for a deposit for a home.

The average 22 to 29-year-old in Locks Heath spends 37% of their typical salary on a one bed rental property

….and 46% of their salary for a 2-bed home in Locks Heath.

40 years ago, British people who rented spent an average of 10% of their salary on rent, and only 14% in London.  Looking in even greater detail, according to the ONS, over the past 60 years the proportion of total spending on all housing (renting and mortgages) has doubled from 9% in the late 1950’s to 18% today.  Whilst on the other hand, the proportion of total expenditure on food has halved (33% to 16%), as has the proportion of total spending on clothing (10% to 5%)… it’s a case of swings and roundabouts!

Yet Landlords also face costs that need to be covered from rents including mortgages, Landlord insurance (especially the need for the often-inadequate deposits to cover the loss of rent and damage), maintenance and licensing.  In fact rents in the last 10 years have failed to keep up with UK inflation, so in real terms, Landlords are worse off when it comes to their rental returns (although they have gained on the increase in Locks Heath property values – but that is only realised when a property sells).

There are a small handful of Locks Heath Landlords selling some/or all of their rental portfolio as their portfolios become less economically viable with the recent tax changes for buy to let Landlords, which will result in fewer properties available to rent.

However, this will reduce the supply and availability of Locks Heath 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 (as we discussed above) and we are all living longer, the demand for rental properties across Locks Heath will continue to grow in the next twenty to thirty years as we turn to more European ways where the norm is to rent rather than buy in the 20’s and 30’s age range. This will mean new buy-to-let Landlords will be attracted into the market, buy properties for the rental market in Locks Heath and enjoy those higher yields and returns… isn’t it interesting that things mostly always go full circle?

We have reached number 16 on our countdown of The Top 30 Most Saleable Streets in SO31, PO14 & PO15.

Are we in your street?