Tag: property news

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3,256 Trafford Properties Remain Empty

Leaving 6,735 People on the Council House Waiting List…

There aren’t enough homes in Sale.

The answer is clearly to build more property in Sale (and Trafford as a whole) – but that, unfortunately for those badly seeking to buy or rent a home in Sale, takes a lot of time and massive amounts of money. So, what other solutions are there?

Talking to a Sale client of mine recently, the subject of the housing crisis was mentioned. They suggested that all the empty properties in Sale could be the solution to this problem. On the face of it, it seems so obvious. Now quite interestingly, I had recently done some research on this topic, which I want to share with you (as I did with them).

The most recent set of figures from 2022 state there are 3,256 empty homes in the Trafford Council area.

So it begs the question, why not put these homes back into the housing system and help ease the Sale housing crisis?

Whilst they stand empty, 6,735 Trafford families are on the Council House Waiting List for council houses.

Nationally, the picture is very similar with 1,206,376 families on Council house waiting lists with 676,304 homes empty.

Surely, we can all agree that property left empty for many years isn’t morally right?

… yet a different story emerges when you look deeper into the numbers.

Every October on one specific day, each local authority must report every property that is empty, even if it’s only been so for a week.

So many of these Trafford properties are either awaiting new homeowners or, in the case of rental properties, new tenants. Also most certainly, some properties are being refurbished and renovated, some are deceased estates, while other properties have homeowners that have moved out and are in the process of being sold (e.g. a part exchange property).

Of those 3,256 Trafford homes lying empty, only 1,071 properties were empty for more than six months.

The fact is that the number of genuinely long-term empty properties is only a tiny drop in the ocean of the 96,269 properties in the area covered by Trafford Council and, even if every one of those empty homes were filled with tenants tomorrow, it would only meet a small fraction of Sale’s housing needs.

So, what does this mean for all the homeowners and landlords of Sale?

This scarcity of available homes contributes to the maintenance of high rents, which presents a favourable situation for Sale landlords who are investing in buy-to-let properties.

Simultaneously, it also serves to keep Sale house prices at a relatively elevated level.

The implications of this situation are particularly evident in the context of Sale’s rental market, where the demand for properties is exceptionally high.

Due to the challenges faced by young individuals in affording homeownership and the financial constraints limiting the construction of new council houses by local authorities, the growth of the rental market becomes an undeniable reality.

Consequently, landlords predominantly focus their investments on the lower end of the housing market, such as starter homes, further fortifying property prices.

This cyclical pattern sustains the entire market as sellers, propelled by the increasing demand, progress up the property ladder, thereby enabling others to purchase homes and continuing the process in a chain-like manner.

These are indeed interesting times in the Sale property market!

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6 Expensive mistakes every first-time buyer should avoid

Embarking on the journey of buying your first home can be daunting, but it doesn’t have to be filled with costly mistakes.

With proper planning and a few precautions, you can avoid the common pitfalls that many first-time buyers encounter.

Here are six mistakes to watch out for and how to steer clear of them:

  1. Neglecting to obtain an agreement in principle

    Before you dive headfirst into house hunting, take a moment to assess your mortgage options. Obtain an ‘agreement in principle’ from a mortgage provider, also known as a ‘decision-in-principle’ Or ‘mortgage promise’. This certificate showcases the amount you’re likely to borrow, offering a realistic idea of your budget. Not securing one could lead to disappointment if you find a dream property but can’t secure the necessary loan. If you need any help and were wondering how to navigate the mortgage process effectively? Our team of experts can guide you and help secure an agreement in principle.

    2. Underestimating the time it takes to get a mortgage

    Be aware that there isn’t a fixed timeframe for mortgage approval. While most applications are processed within 18 to 40 days, delays can occur. Start your mortgage application as early as possible to avoid rushing into an offer on a home.

    3. Choosing the wrong solicitor

    The difference between a good and bad solicitor could be the difference between you moving into your home in 14 weeks instead of 23 weeks. Ask us and we will tell you who is the best solicitors.

    4. Failing to research the area of you are looking in

    Before you start viewing, define your priorities for the area you wish to live in. Consider factors such as transportation links, green spaces, primary schools, and amenities. Understanding your needs will streamline the selection process. If possible, spend time in unfamiliar areas you’re interested in to get a sense of the atmosphere and assess transportation links.

    5. Purchasing a ‘non-standard’ property

    Certain property types may complicate obtaining a mortgage. Lenders may hesitate to approve loans for flats above shops, areas of high-density renting, or commercial premises due to potential issues like noise, smells, and security concerns beyond the owners’ control. New-build homes may also have stricter lending criteria. If you’re considering a non-standard property, gather as much information as possible and seek expert mortgage advice to strengthen your application. If you are unsure about the eligibility of a specific property? Our team can provide valuable insights and help you navigate the complexities of mortgage approval.

    6. Not asking enough questions during property viewings

    While it’s tempting to make an offer on the first seemingly perfect home, rushing in blindly can result in costly renovations and long-term expenses. Prepare a list of questions to ask during viewings. Test windows, doors, lights, and water pressure, and don’t be afraid to look beyond furniture for any hidden defects. Inquire about the sellers, their tenure at the property, and their motivation for moving. Knowing how long a property has been on the market can also be advantageous, as sellers might be more open to accepting lower offers for a quick sale. If you need guidance on what questions to ask during property viewings? Our experienced estate agents are here to help and provide the necessary support.

    Remember, buying your first home doesn’t have to be overwhelming.

    Avoid these common mistakes and reach out to us if you have any concerns.

    We’re here to assist you throughout the process, ensuring a smooth and successful journey into homeownership.

    Contact us today on 0161 3273 161 to receive expert advice tailored to your unique situation.

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    Is Buy-to-Let in Sale Still Worth the Risk?

    Over the last five years, life has become a little trickier for Sale landlords, with changes to their taxation status, mortgage interest relief and an additional 3% stamp duty for a buy-to-let property, and has made lots of Sale landlords ask themselves:

    ‘Is buy-to-let in Sale still worth the risk?’

    Regarding taxation, in 2016, the Government added a 3% supplement in stamp duty on all buy-to-let properties. Then, in 2017, the Government started to reduce mortgage interest by stopping landlords from deducting the interest they paid on their mortgage before paying tax on the rental profits and replacing it with a flat rate tax credit based on 20% of the interest they spent on their mortgage.

    There would be no effect if a Sale landlord were a basic rate 20% taxpayer. Yet Sale landlords who were higher-rate (40%) or top-rate taxpayers (45%) saw an effect as their tax relief was cut in half.

    So, is buy-to-let in Sale still an advisable investment?

    The response to this question is much more significant than the issue of taxation.

    To a large degree, as with all investments, it depends on why you are investing and what your final objective is. Let me expand.

    The rewards of Sale buy-to-let.

    You can earn money two ways with buy-to-let.

    The first is the rental income from the property.

    The average rent achieved in Sale is £1,186 pcm, a rise of 11.1% in the last 12 months.

    This rent is expressed as a yield and is described as a percentage figure that’s calculated using the annual rental income and dividing it by the value of the buy-to-let property.

    Landlords and buy-to-let investors use rental yield to judge and measure the value of their rental investments and portfolios. E.g. rent is £1,000 per calendar month (pcm), which means the annual rent is 12 x £1,000 = £12,000. If the property is worth £180,000, the rental yield is £12,000 divided by £180,000, which, when expressed as a yield percentage, is 6.67%.

    The average yield in Sale is 3.7%.

    Some areas in Sale can easily achieve a 5.2% to 6.7% yield, sometimes even more, depending on your choice of property and type of tenancy you wish to have.

    If yield is your number one focus, the highest average yield in the UK can be found in Bradford City Centre, where it is 12%, Hyson Green and Radford in Nottingham at 9.6% and Pontypridd at 8.7%, while other areas in the UK can be as low as 2.2%.

    So indeed, is the best strategy to go for high-yielding properties?

    The problem with pursuing high-yielding Sale buy-to-let properties is that you usually must compromise on the property’s capital growth to attain that high yield.

    The second way to earn money with buy-to-let is capital growth as your Sale property increases in value.

    M33 property values are 32% higher than 3 years ago.

    A reasonable return in anyone’s books.

    Of course, this all depends on the rent coming in, yet you can buy landlord insurance to cover against loss of rental income, tenant damage and legal costs.

    Interestingly, using Government data and Industry data, Denton House Research found that in the first lockdown landlords who managed their rental properties themselves were 272.5% more likely to be in arrears of 2 months or more (compared to those who utilised the services of a letting agent to manage their property).

    The drawbacks of Sale buy-to-let.

    Your tax bill is higher today than a few years ago, but isn’t everyone’s?

    If Sale property prices fall, the capital you invested will reduce, yet if it sat in the bank, it would decline in value anyway.

    Being a landlord is a big responsibility, with over 170 pieces of legislation and orders to comply with. That’s where a suitable letting agent can help you with your rental property to ensure you remain compliant.

    I recommend Sale landlords consider all options to maximise their rental income whilst reducing their outgoings concerning their rental property.

    Rents are rising in Sale (as mentioned above), and many Sale landlords appreciate the demand-led increases in their rent. And let me ask you, why shouldn’t they, as they have been exposed to many legislative and taxation changes over the last five years?

    Ok, last point and the elephant in the room.

    Will there be a house price crash, and should Sale landlords wait for it?

    A house price crash conjures up a big event that makes house prices go down, and it certainly happened like that in 1988 with the removal of dual-MIRAS tax relief on mortgages and the Credit Crunch in 2008. Yet this time, it’s different.

    As there is more normality and balance in the Sale property market at the moment (compared to 2021/early 2022), the price that is being paid today on most houses in Sale is not as extreme or as extravagant as what was being paid in 2021/early2022 (when people were outbidding each other).

    Therefore, if you were to look at the house price indexes going into the spring and summer of 2023, then there will be a reduction. The doom-mongers and newspaper editors will call that a house price crash, yet I see it as the market easing back to normality.

    A massive driver behind landlords and home buyers ‘waiting for a house price crash’ is that they fear they have ‘missed the boat’ when it comes to buying/investing.

    There is always newspaper (and now social media) attention when house prices explode. This means people quickly feel pressure to enter the ‘property market’, as everyone is making money, yet they aren’t.

    The problem is that during the previous boom phases (the late 1980s and early/mid-2000s), house prices increased quicker than some people could save money for their deposit (for a house purchase). They saw their friends and acquaintances snapping up buy-to-let deals and they were missing out on the spoils of house price growth. As a result, many of these excluded house buyers judged that a house price correction was foreseeable, inevitable, and sometimes even needed. Not with any rational economic argument, but classic FOMO (Fear of Missing Out).  

    Yet a ‘house price crash’ isn’t the silver bullet that many think it will be.

    ‘House price crashes’ virtually never drop house prices to reasonable levels, and in fact, they have a lot of additional effects that make house buying even harder.

    Investing in buy-to-let is a long-term investment. Remember what I said at the start. It would help if you decided why you’re getting into buy-to-let investment and when you will get out (and what you want to get out of it). Buy-to-let has advantages and disadvantages, but it is something tangible and something that investors can understand.

    The UK needs to build more houses, so the demand for rental properties will only continue to grow.

    The heady days of the early 2000s, when anybody could make money from any property, though, have gone. With increased legislation and taxation, you need the advice of a great agent to guide you on what to buy (and not to buy) for an excellent yield, incredible capital growth or a balance of the two. That agent should be able to find you a great tenant who will pay the rent on time and look after the property to ensure that when they leave, your investment is returned to you in the best condition possible.

    If you would like to pick my brain, whether you are considering becoming a landlord in Sale, an existing landlord (irrespective of which agent you use) or even a self-managed landlord, do not hesitate to pick up the phone to me.

    I will tell you what you need to hear, not necessarily what you want to hear.

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    Sale Baby Boomers and their 37,905 Spare ‘Spare’ Bedrooms

    An additional 1,890 spare bedrooms have been locked out of the Trafford housing market since 2011 as Britain’s ageing population means the country’s stock of homes is being used more unproductively.

    The number of spare bedrooms in Trafford between 2011 and 2021 increased from 106,761 to 108,651.

    The number of Trafford households living in properties with at least two spare bedrooms (i.e. spare ‘spare’ bedrooms) increased slightly by 977, from 36,928 households to 37,905 households between those ten years.

    That means 39.4% of Trafford households have two or more spare bedrooms.

    And this isn’t just a local issue; Britain has 8,902,471 properties with a spare ‘spare’ bedroom (i.e. they have two or more spare bedrooms).

    Before I dive deep into the issue of these ‘spare’ spare bedrooms, let me look at the ‘occupancy rating’ of all households in the country.

     There are 8.26 million households with one spare bedroom, 6.57million households with no spare bedrooms (i.e. the household’s accommodation has an ideal number of bedrooms), 880,672 households where they are classed as over-crowded under the ‘Bedroom Standard’ by one bedroom and 173,751 households where they are classed as over-crowded under the ‘Bedroom Standard’ by two bedrooms.

    The ‘Bedroom Standard’ allocates a separate bedroom to each of these groups (according the Office of National Statistics):

    • adult couple
    • any remaining adult (aged 21 years or over)
    • two adolescents (aged 10 to 20 years) of the same sex
    • one adolescent (aged 10 to 20 years) and one child (aged 9 years or under) of the same sex
    • two children (aged 9 years or under) regardless of sex
    • any remaining child (aged 9 years or under)

    So, with this serious overcrowding, why is this under-occupation happening and is there a better use for these homes?

    Britain has an ageing population. Just over 1 in 5 (18.6%) of Britain’s population are aged 65 years or older, compared with 1 in 6 (16.4%) a decade ago.

    In the last ten years, many of Britain’s baby boomer generation (currently aged 59 years to 77 years of age) have entered retirement. Most of these extra bedrooms are in homes owned by these baby boomers, who are probably still living in the original family homes they bought in the 1980s or 1990s to raise their children, yet still live there years after their children left home.

    And it will get worse throughout the 2020s as the number of Brits living in homes greater than their needs will grow further as the demographics of the British population shift.

    There are 68,247,855 bedrooms in England & Wales, and even if nobody shared a room, there would be enough for every one of the 59,597,542 of us to have a bedroom and still have 8,650,313 spare bedrooms! They are very unequally distributed between households.

    What’s the answer?

    Some on the left suggest we forcibly make these older mature Sale homeowners people move to smaller homes. Yet, it’s their property; they paid the mortgage on it for years (especially when mortgage interest rates were 15% and above), and thus, it’s their choice if they want to move or not.

    Some of the difficulties are that downsizing in Sale often needs to make financial sense for mature homeowners.

    Most mature Sale homeowners live in average-priced homes and suitable bungalows, even though they are smaller, often cost as much, if not more, than their large family home.

    This issue will slowly worsen in the coming twenty years, so what are the options?

    There is a necessity to motivate builders to build suitable properties for these mature homeowners to move into and to change the dynamics of the available properties to buy. For example, there are only 2 million bungalows in the UK, and we only built just over 1,800 new bungalows in 2020, yet seven in ten UK people (c. 10.7 million) aged over 65 want to live in a bungalow.

    Secondly, there needs to be reform of the taxation rules on housing. Taxation works on the carrot or stick method.

    The ‘stick’ could make it less attractive to stay in larger houses by increasing the higher council tax rates in the higher council tax bands. The ‘carrot’ could incentivise mature homeowners to downsize with allowances on stamp duty or inheritance tax, thus making a move easier.

    However, the cost-of-living crisis and heightened energy bills could be doing the Government’s job for them.

    The number of larger Sale homes owned by mature homeowners, often for 25 years plus, has been snowballing in the last six months.

    This is good news for younger families that can afford to jump from their smaller homes, yet many can’t afford to make the jump for the same reasons why mature homeowners are moving home.

    For example, of the 181,195 properties put on the market in the UK in November and December 2022, 56.9% were under £350,000. However, of the properties sold in the UK since Christmas 2022, 66.3% of them have been £350,000 or less.

    This means those homeowners in the middle to upper levels of the Sale property market need to be very realistic with this pricing as the supply of the mid/high range properties is outstripping the demand.

    Whilst it is not a good distribution of housing if you have some people in overcrowded households and others with spare bedrooms, everyone should be able to choose how to live.

    Many Sale homeowners delay downsizing because they prefer to grow old in their family home rather than downsize. However, I often see mature homeowners downsizing too late when say, they have had a fall, are unable to manage the basics of gardening or cleaning, or the home becomes a physical hazard.

    This downsizing phase will continue to grow, peaking in the mid-2030s.

    The issue is, I cannot see builders or the Government building hundreds of thousands of bungalows in the next decade.

    So maybe, you should consider making a move in the next few years, when you will have a better choice of bungalows to move to and you are able to put your stamp on it when you are in your 70’s and before you are unable to in your mid/late 80s?

    If mature homeowners have large properties earned from working hard and paying taxes, then quite frankly, that is nobody else’s business and no one should force you out!! You might want that extra space for children and grandchildren to come and stay or as office space, a television room or a hobby room. Yet please, I must stress these are only suggestions.

    These are my thoughts; what are yours?

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    Inflation – Every Lymm Landlords’ Saviour

    Some of you reading this will be old enough to remember the 1970s – the bell-bottom trousers, the huge collars, frayed jeans, disco glitter balls, maxi dresses, midi skirts but above everything else – HYPER-INFLATION.

    With inflation currently standing at 11.1%, many of us envy the last few years when we have been lucky to experience sub 2% inflation.

    But in the 1970s, the UK had proper and persistent double-digit inflation for seven of the ten years of that decade.

    The average annual UK inflation rate for the 1970s was 12.3% per year, with prices rising by 25% in 1975 alone.

    The inflation was caused by several things, including oil prices quadrupling in the 1973 Oil Crisis (sounds familiar, doesn’t it?), powerful unions, a high level of growth and investment in the 1950s and 60s, meaning it was easier for the British economy to experience inflationary pressures in the 1970s and the property market then was not immune to these inflationary pressures.

    The average Lymm house rose from £6,854 to £35,500 between the start of 1970 and the end of 1979.

    That would be the equivalent of an average Lymm house going from today’s price of £427,585 to £2,214,526 in 2032.

    The existing climate of rising prices (inflation) is affecting everyone, from filling up the car with petrol to doing the weekly ‘big shop’. Looking specifically at the buy-to-let market, Lymm landlords are suffering from rising costs and prices like everyone else, including a substantial increase in labour price inflation as skill shortages have pushed up the cost of using all the trades.

    Other worries include whether tenants can pay their rent with the cost-of-living crisis. Also, there is a rise in interest rates which increases landlords’ mortgage payments and professional fees, including accountants, and landlord insurance rates continue to climb.

    So, is inflation all bad for Lymm landlords?

    Most economists say that inflation is bad for the economy.

    The absence of steady and stable prices makes consumers and businesses hold off making decisions to buy things, and when that happens, the economy stalls. Look at what happened in Germany in 1923, where you needed a carrier bag of cash to purchase a loaf of bread. Today, Zimbabwe has annual inflation of 269% a year, and Venezuela has 156% annual inflation, meaning their economies are on their uppers.

    Thankfully, nobody is predicting British inflation will reach those levels.

    Yet would it surprise you that inflation can be good news for landlords?

    Property has grown above the rate of inflation over the last 50 years. It means that your hard-earned savings invested in property will increase in value over and above the inflation rate, which will safeguard your wealth during these periods of high inflation.

    However, knowing where we are on the economic cycle makes it easy to spot when house prices are lower in the short term (in real terms), thus buying yourself long-term ‘extra’ profit.

    The average Lymm property today is worth £427,585. Roll the clock back to the autumn of 2007, and it was £288,251.

    Quite a gain (and no profit) until you look at inflation.

    It appears people who bought in 2007 have made money when they have lost it in ‘real terms.

    What do I mean by that? What exactly does ‘real terms’ mean?

    Everyone knows that £100 today doesn’t buy what £100 could have bought you ten years ago and much less than 20 years ago … that’s the effect of inflation.

    ‘Real terms’ means the price value after adjusting for inflation and expressed in constant Pound Sterling, reflecting buying power relative to another year. For example, the ‘actual’ price of a Mars bar in 2000 was 26p, yet its ‘real price’ (expressed in today’s prices) is 74p. Why 74p? Because 74p is what a Mars Bar costs today.

    What price in the past has the same spending power today? So, looking at the £288,251 average price for a Lymm house in autumn 2007 (as mentioned above), one would need £480,167 today to buy the same amount of ‘retail goods and services’ (e.g., cars, food, Mars Bars, holidays etc.) – that is what ‘real terms’ mean.

    That means even without any house price falls (which many are predicting), average house prices in Lymm are £52,582 cheaper in ‘real terms’ today than in 2007.

    Calculation: £480,167 (autumn 2007 Lymm house price expressed in today’s spending power terms – i.e., in ‘real terms’) less £427,585 (today’s average actual house price in Lymm) equals £52,582.

    The other significant advantage of inflation for landlords is buy-to-let mortgages. Most landlords use a buy-to-let mortgage to buy their Lymm property investment. Let me give you some scenarios which explain why this is the case.

    Firstly, let’s assume there was no inflation (like in Japan in the last couple of decades). If a landlord took out an interest-only buy-to-let loan of £200,000 10 years ago, then in 10 years, that buy-to-let mortgage, which would need to be paid off, would still have a ‘real value’ of £200,000.

    Secondly, let’s assume the same landlord took out an interest-only buy-to-let loan of £200,000 10 years ago (2012). In the last decade, there has been 31.4% inflation, so that buy-to-let mortgage would have a ‘real value’ of only £137,200.

    Now inflation won’t be in double digits for the long term in the UK (higher interest rates and a recession will put pay to that), yet let’s say the inflation rate for the next ten years was 4% per annum.

    In this scenario, the ‘real value’ of the £200,000 buy-to-let mortgage falls to less than half its original real value of £91,278.

    So, if one thinks about it, inflation could be just the thing that Lymm landlords need to shrink the ‘real value’ of their buy-to-let mortgage. As the saying goes, every cloud has a silver lining.

    On the back of double-digit percentages, growth rises in rents, and everything stated in this article, inflation could be the silver lining!

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    Lymm Tenants Face Further Rent Hikes, as the Number of Available Rental Homes Drops by 43%

    • The number of properties available to rent in Lymm has dropped from 54 to 31 since February 2020.
    • The average rent a tenant has had to pay in Lymm has risen from £1,287 to £1,694 since February 2020.
    • Many Lymm landlords have cashed in on the post-lockdown property boom of the last two years and sold their properties to owner-occupiers – not fellow landlords.
    • The supply of Lymm rental property isn’t near what is needed, which is of benefit to Lymm landlords rather than Lymm renters.

    The Lymm rental property shortage is currently very evident. In this article, I will investigate why there is such a significant lack of homes available for rent across Lymm and what it means for buy-to-let investors.

    Anybody who enjoys surfing the property portals (Rightmove, Zoopla and On the Market) will have observed an emerging trend that the number of properties available to rent in Lymm has dropped considerably in the last couple of years.

    This reduction has been seen all around the UK as well. For example, on 1st November 2020, there were 372,931 properties to rent on portals. By the 1st November 2021, that had dropped to 275,650; by the 1st November 2022, that had fallen to 171,224.

    That doesn’t mean the number of privately rented homes in the country has dropped by over half. Fewer properties are coming onto the market to rent. I will explain why in this article. For tenants, especially over the last 12 months, it has become progressively more challenging to find a Lymm rental home, thus making the rent they must pay go up. This state of affairs in the property market isn’t showing an indication of getting any easier either, making for a hard time for Lymm renters.

    So, what is the reason behind the Lymm rental property shortage, and what does this mean for existing Lymm landlords or those potential investors considering buying a Lymm buy-to-let property soon?

    Several different components are making the perfect storm in the UK property market.

    Firstly, the number of households in the UK.

    The UK has not been building enough homes for the last 20 years. I appreciate that parts of Lymm seem like one huge building site, yet as a country, we are woefully undersupplied with property to live in. This has meant house prices continue to rise due to demand. 

    The government have known about this issue for decades. The Barker Review of Housing Supply published in 2004 stated that the UK had experienced a long-term upward trend of 2.4% in real house prices since the mid-1970s because of a lack of house building. The report stated that 240,000 houses needed to be built each year to keep up with demand.

    The average number of houses built since the mid-1970s has been around 165,000 per year, meaning the UK is short of 3,375,000 houses (i.e., 45 years multiplied by 75,000 missing homes per year).

    Several years ago, the government set a target to build 300,000 new homes each year to address this issue.

    However, in 2019/20, the actual number of homes delivered stood at just 243,770. In 2020/21, the number of properties built dropped to only 216,000 new homes. In a nutshell, there are fewer available homes to buy, meaning fewer available homes to rent. 

    Secondly, Lymm tenants are staying in their rental homes longer.

    A Lymm first-time buyer’s average house deposit is £33,983 (the UK average deposit is £53,935).

    The average rent of a Lymm property in November 2022 is £1,694 per calendar month (up from £1,287 per calendar month in February 2020) – quite a rise!

    These numbers translate into Lymm renters not being able to pay the rent and be able to save for a deposit, or if they are saving, it is taking a lot longer to save for a deposit due to the cost-of-living crisis and higher rent costs.

    Also, many Lymm tenants have decided to stay in their existing rental homes because of the rent rises. Many landlords are less inclined to raise the rent on an existing property when they have a decent tenant who keeps the property in good condition and pays rent on time. Anecdotal evidence also suggests that rent arrears in those properties are dropping as tenants know if they don’t pay the rent, the chances are they will have trouble finding another property, and if they do, they will have to pay a lot for their next rental home.

    For Lymm landlords, this is all positive news – tenants are staying for longer in their Lymm rental properties, arrears are lower, and void periods are less likely. When it comes to the market, there is less competition (because of the decrease in the availability of Lymm rental properties) so this makes the investment an even better bet.

    Thirdly, landlords are selling up on the back of recently increased house prices.

    It would be difficult for Lymm buy-to-let landlords to ignore the rising property prices in recent years.

    The average property value in Lymm in the summer of 2022 was 17.5% higher than in the summer of 2021.

    For some Lymm buy-to-let landlords, especially those who were classified as ‘accidental landlords’ (an accidental landlord is a landlord who never chose to become a landlord, it was just after the Credit Crunch of 2008/9, they found themselves unable to sell their property, so they temporarily let their own property out), they chose to ‘cash in’ on the higher house prices. This would have also contributed to the lack of available Lymm homes for rent.

    Yet everything isn’t all sweetness and light for Lymm landlords.

    Landlords have a few costs to consider before investing in buy-to-let, including everything from regular refurbishment costs, buildings insurance, letting agents’ fees, income tax, and, not forgetting, stamp duty.

    Talking of costs, one issue some Lymm landlords are facing is their failure to plan financially for the recent mortgage interest rate rises. Some Lymm landlords may have become complacent to the ultra-low Bank of England base rates we have had since 2008 and, therefore, may need to sell their rental property, which, if bought by a first-time buyer, will remove another property from the Private Rented Sector.

    Another hurdle to jump is the proposed new regulations requiring better energy efficiency for rental properties. It is proposed all new tenancies must have at least a minimum of a ‘C’ rating for their EPC (Energy Performance Certificate) from 2025 (and 2028 for all existing tenancies).

    Therefore, as a buy-to-let Lymm landlord, it is wise to do your research to make sure the buy-to-let opportunity is correct for your rental portfolio, particularly when it comes to weathering any impending financial storms. 

    Landlords need to consider the returns from their Lymm buy-to-let investments.

    Landlords can earn money from their buy-to-let investments in two ways. One is the property’s capital growth, and the other is the rental return (often expressed as a yield). In 96% of buy-to-let investments, there is an inverse relationship between capital growth and yield (i.e., properties that tend to go up in value quicker will have lower yields 96% of the time – and vice versa).

    Getting the best balance of yield and capital growth depends on your current and future needs from your Lymm buy-to-let investment.

    If you would like me to review your portfolio and ascertain if your existing portfolio will match your current and future needs for the investment – whether you are a client or not, feel free to drop me a line, and we can have a no-obligation chat and possibly organise a review.

    What does all this mean for the Lymm rental market?

    The continued shortage of Lymm rental properties means it will be more difficult than ever to find a Lymm property to rent, and so rents will continue to grow.

    Unlike in Scotland, England and Wales do not have rent controls, with Westminster ruling out the possibility of introducing rent control here to deal with the cost-of-living crisis.

    You would think rent controls would be a no-brainer, yet economists from around the world have proved for the last 75 years that rent controls might help tenants in the short term, yet ultimately it drives landlords to sell their investments in the long term, thus reducing the stock of available properties to rent out (not great for future tenants).

    Therefore, it is highly likely that Lymm rents will continue to rise for tenants.

    Landlords who persevere with their Lymm buy-to-let properties or become a Lymm buy-to-let landlord are set to benefit because they have an asset in very high demand.

    The housing shortage, not to mention the other issues discussed above that are affecting the supply of rental properties, is unlikely to be fixed anytime soon!

    In conclusion, the Lymm rental market is a constantly changing picture. What is known is that the supply of rental properties is far from what is needed, which can only be to the benefit of buy-to-let investors rather than of tenants renting.

    I see buy-to-let as a long-term investment. Everyone reading this knows that the real value in your buy-to-let investment is playing the long game, allowing your Lymm buy-to-let investment to grow over time. Like the crypto or stock market, getting sucked in by get-rich-quick schemes that are selling ‘apparent quick wins’ in property investment is very easy.

    I regularly highlight the best buy-to-let deals for Lymm landlords with all the estate agents (not just my own). You don’t need to be a client of mine either to receive that information. Drop me a line or call (without any cost or obligation) if you are interested in making your first Lymm buy-to-let investment or considering adding to your existing Lymm portfolio.

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    Is Now a Good Time to Buy a Home?

    This is the question many people are asking right now, and the answer depends on your circumstances.

    I pride myself on my ability to provide objective, fact-based information on the Sale property market so potential Sale house sellers, landlords and buyers can make the best decision for themselves.

    My role is to educate the potential Sale house sellers, landlords and buyers and to provide them with the best possible information available, not to convince them to do something they don’t want to do.

    To answer that big question in the title of the article (is now a good time to buy a home?), it comes down to three things.

    1. How much will you get for your Sale home when you sell it?
    2. How much will you have to pay for your new home?
    3. How much will that move cost you in ongoing monthly mortgage payments?

    To answer points 1 and 2 correctly, I need to address point 3, which relates to interest rates.

    The click-bait newspapers and websites are pushing messages to potential sellers and buyers towards the top end of the sensationalised scale. I prefer to define what is happening, i.e. the reality.

    On the face of it, it doesn’t look good.

    The average 5-year fixed rate mortgage has risen from 2.11% at the beginning of January this year to 6.21% in early November.

    Yet even though the Bank of England increased the base rate by 0.75% on the 3rd of November, the average 5-year fixed rate mortgage dropped by 0.22% between the 3rd week in October and bonfire night. As interest rates go up, mortgage rates are coming down even though interest rates are projected to increase to 4.5% by the autumn of 2023.

    So, why did the Bank of England mention in the first week of November that the UK is facing a two-year recession? Some might think this controversial, yet the Bank of England wants a recession as it will aid in reducing inflation. It’s as plain and simple as that!

    Instead of relying purely on interest rates to reduce inflation, the Bank of England is hoping if we go into some form of shallow recession, it will not need to increase interest rates much above the anticipated 4.5%.

    However, whether it’s interest rates or a recession, both will slow the number of home sales in Sale and will indirectly affect Sale house prices.

    So will Sale house prices drop? By how much and what money will it save you if you wait?

    I have spoken recently in my property blogs about the Sale property market, and the prices that will be achieved for homes in late 2023/early 2024 will be between 5% to 10% lower than what is being achieved today. There is no point in repeating why (message me if you want those articles), but in essence, increasing mortgage rates, inflation and affordability will mean the price people can pay for a Sale home will be curtailed because of those factors. Let’s assume a reduction of 10% in Sale house prices.

    Around 81 in 100 existing homeowners are buyers. When they sell their home, they almost always move upmarket regarding accommodation and location. Hence, they will pay more for the home they buy than the property they sell.

    So, if you are in Sale and live in a 2-bed house (average value £318,929) and want to buy a 3-bed house (average value £412,670), the difference between both would be £93,741.

    If Sale house prices dropped by 10% in a couple of years, that £318,929 2-bed house would drop to £287,036, and that £412,670 3-bed house would drop to £371,403, meaning the gap would drop to £84,367. Thus, saving the home buyer £9,374.

    So, should they wait?

    Yes, until you look at the monthly ongoing mortgage payments.

    Assuming our Sale homeowner has an existing mortgage of £175,000 and added the difference of moving up the property ladder to the mortgage. If our Sale home mover moved now, their mortgage payments would be £1,415.13 per month (assuming a 35-year mortgage on a 5-year fixed rate at 5.34% with First Direct).

    The other scenario would be if our Sale buyer waited a couple of years for Sale house prices to drop 10% (to save the £9,374 mentioned above) to make a move.

    Everyone acknowledges interest rates will rise in the next two years, so the monthly mortgage payments when they move (even though they are borrowing less) would be £1,691.66 per month (based on a 5-year fixed mortgage being 7.19% in 2 years).

    By waiting 2 years, it will cost the Sale homeowner £276.53 extra per month in interest payments or £16,591.76 in the 5-year mortgage term.

    The point is that because interest rates are forecast to go higher in the next couple of years, this provides potential Sale buyers with the prospect of locking in their monthly housing expenses by moving now.

    By buying now, it hedges against rising interest rates; consequently, your monthly mortgage payments are going to be higher. It offers an opportunity, through re-mortgaging, to lower your mortgage costs should interest rates fall.

    What about Sale first-time buyers?

    I wrote an article on the Sale property market only a few weeks ago. Even when we looked at house prices dropping by 18% in two years (because in the 1988 house price crash, the market dropped by 20% and 17% by 2008), the savings made on the purchase price were blown out of the water with the two extra years of rental payments, the higher deposit and higher interest payments.   

    The actual crisis in the property market today is the rocketing rental rates.

    Whilst a fixed-rate mortgage locks in your monthly housing costs, rental rates are rocketing upwards, and a tenant today can realistically expect higher monthly costs in the coming few years.

    Though most of the press generally focuses on the monetary aspects of buying a home, there are also choices on homeownership that are not exclusively based on financial decisions.

    Why are you considering buying a Sale home?

    Buying a Sale home is very personal and predominantly driven by your life events like divorce/marriage, a job move, a new addition to the family, elderly parents moving in etc. These are often the influences that drive the decision to buy (or not buy) a home.

    Homeownership has always been a foundation stone of the British dream.

    Homeownership offers control and a sense of security that renting simply cannot provide.

    The doom-monger headline-grabbing newspapers often overlook these non-economic factors affecting the desire of a potential home buyer.

    The one important thing from the last few years since the first lockdown in 2020 is that people still want to own their own homes.

    They still want to have their ‘castle’, to pull up the drawbridge when things get tough, a place that they and their family can call their own. Never forget that homeownership is much more than house prices and graphs; it’s about the ‘Englishman’s home is his castle’ dream.  

    Let us remember most people in the UK have been able to build and grow their family wealth through homeownership. That is why I like to provide the best information on the Sale property market so you can make the best decision for yourself and your family. Please drop me a line if you wish to pick my brain on anything discussed in this article.

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    Will Sale buy-to-let continue to be profitable in the next few years?

    Being a Sale landlord is undoubtedly a challenge. The glory years of making money from ‘any old property’ are certainly in the past. With increased legislation and taxation from Government and the cost-of-living crisis (which will result in some Sale tenants struggling to pay their rent), times are challenging for many landlords.

    Then newspapers are full of stories of landlords being pushed into the red as mortgage rates continue to rise. A landlord last summer could have fixed their 5-year buy-to-let rate with a 25% deposit at 1.86%, whilst today the best 5-year deal is with Barclays at 4.36%. This increase will add more than £246 per month to the landlord’s mortgage bill for the average UK buy-to-let property.

    Landlords’ mortgages stand at £237.81bn, meaning collectively, landlords could have to pay an additional £7.11 billion per year in mortgage interest payments.

    Next, the press is reporting in Q2 2022 (when compared to Q2 2021), landlord possession claims for arrears increased from 6,997 to 18,201 properties (a rise of 160%), property orders from 5,431 to 14,319 (an increase of 164%), warrants from 3,786 to 7,728 (a rise of 104%) and landlord repossessions from 1,582 to 4,900 (a rise of 210%).

    This is on the back of the Section 24 tax changes made a few years ago and ahead of expensive energy efficiency upgrades that the Government is expected to legislate for in the coming 12 months.

    Doesn’t sound good for landlords.

    Until you look past the headlines and look at the actual detail.

    79.93% of UK buy-to-let (BTL) mortgages are interest-only mortgages (compared to 12.29% of homebuyers), meaning the repayments are considerably lower than typical homebuyer mortgages. Therefore, the rise in interest rates won’t hit landlords’ profitability as much as many thought initially.

    93.21% of all new BTL mortgages agreed in the last two years have been on a fixed rate mortgage, and 73.27% of all existing BTL mortgages are on a fixed rate. So, the increase in mortgage payments will only affect one in four landlords on variable-rate mortgages.

    Let us not forget that less than one in three landlords have a BTL mortgage, meaning two out of three landlords aren’t affected by these interest rate rises.

    The average rent of a Sale property is now £1,454 per month, an impressive rise of 9.8% compared to a year ago.

    Those possession orders mentioned above look high until you realise that there are 4.4 million properties in the private rented sector. That means only 2.04% of UK rental properties had arrears bad enough for landlords (or agents) to start possession proceedings to evict the tenant. Also, only 0.045% of tenants were evicted through the courts in a calendar year.

    Talking of arrears, recent studies using statistics from the Government and other letting industry sources show that…

    landlords who didn’t use a letting agent to manage their property were 272.5% more likely to be two months or more in rent arrears in 2021. It pays to use a letting agent!

    Next, the potential cost of upgrading rental properties’ energy efficiency.

    The proposed changes in the MEES regulations a minimum energy efficiency (measured by its Energy Performance Certificate (EPC)) to a ‘C’ rating on new tenancies from 2025 and existing tenancies by 2028. That will cost, on average, £10,000+ per property.

    Yet it cannot be forgotten when the rules changed in 2018, properties had to have a minimum EPC rating of E in England and Wales to be legally compliant. If a landlord of an ‘F’ or ‘G’ rated rental property could prove that it would cost more than £3,500 to make those improvements to their EPC rating, then that was the most the landlord had to pay. No doubt something similar will take place in the future proposed legislation.

    Then there is the profitability of renting. Rental yields are the primary guide to profitability in buy-to-let.

    Yields are starting to rise as Sale rental growth is beginning to outstrip Sale house price growth.

    The average yields being achieved in Sale today are:

    • 1 bed – 5.7% yield
    • 2 bed – 4.9% yield
    • 3 bed – 4.1% yield
    • 4 bed – 3.2% yield

    Yet investing in buy-to-let isn’t just about the yield.

    Demand from tenants plays a massive part in the success or failure of your buy-to-let investment, so other yardsticks, such as void periods, should be considered. There is no point in securing a higher-yielding rental property if that buy-to-let investment remains empty.

    My research has found that the Sale overall void period average so far is 41.4% lower than 18 months ago, reducing from 29 days in April 2021 to 17 days in September 2022 (the void period being the time it takes from the date of an old tenant moving out until the new tenant moves in).

    Finally, buy-to-let investment is also an excellent hedge against inflation compared to other investments. If you would like more information on that, drop me a line, as it’s too long to post here.

    In conclusion, the days of buying any old Sale buy-to-let property at any price and making loads of money from it as easy as falling off a log

    are gone!

    The next few years will be challenging for everyone. Still, with the advice and opinion of a decent Sale letting agent to guide and support you on your buy-to-let journey, buy-to-let will continue to be a profitable investment.

    You need to review your rental portfolio regularly. See how your portfolio measures up against yield vs capital growth see-saw. Review your mortgage financing and EPC status of your portfolio. 

    If you would like a no obligation chat with me to discuss your options as a new potential landlord or an existing landlord with a rental portfolio, then let’s talk.

    Let us see whether your expectations from buy-to-let match your potential investment in Sale property. I look forward to you picking up the phone or sending me a message for a no-obligation chat.

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    Will Waiting for the Sale House Market to Crash Cost You More in the Long Run?

    Doom and gloom in the British property market or clickbait doom-mongers?

    Newspapers and clickbait 24-7 news websites, desperate for clicks, are peddling a story of a doomsday time for the economy, particularly the property market, as interest rates and inflation create the perfect storm for the UK property market.

    So, let us look at what is happening in the British property market and whether house prices will drop.

    Yes – Sale house prices will be lower in 24 months.

    Yet the reductions in what I believe a property will sell for in the next couple of years compared to the doom-mongers is wildly different.

    The doom-mongers are saying the 2022 property market will be like the crash years of 1988 and 2008.

    I’m afraid I have to disagree, let me explain what the difference is this time compared to the previous house price crashes.

    To start with …

    56.25% of homeowners don’t have a mortgage, whilst in 1988, that was 35.8%. These people are shielded from the interest rate rises.

    The next point is negative equity.

    Yes, negative equity was an issue after 1988 when everyone had an endowment mortgage, so they never paid any of the capital off their mortgage. Therefore, when house prices dropped, negative equity was a massive issue as people owed more than what their house was worth.

    By 2008, nobody was taking out endowment mortgages, yet still, 1 in 2 were interest-only mortgages (meaning the capital wasn’t being paid off). Today, 17 out of 20 homeowners are on repayment mortgages – so they have more home equity, so negative equity isn’t so much an issue.

    The issue is the increasing interest rates. Yes, they are rising … albeit from artificially low rates.

    In 1988, nearly everyone was on a variable rate mortgage and an average mortgage interest rate was 10.8%, and they rose to 16.4% by 1990. That hurt, yet most survived.

    In 2008, 6 out of 10 homeowners had learned their lesson and were on fixed rates at an average rate of 6.07%. Today 17 out of 20 homeowners have long-term fixed rates with an average of 2.14%.

    Also, it must be noted that homebuyers have been stress tested for 6% to 7% mortgage rates since 2014 because of the Bank of England MMR rule changes. It will be challenging, and lifestyle choices will need to be made, yet we should not see the dumping of houses on the market as we did in 2008/9.

    The next issue is the number of mortgages being pulled. Yes, around 1,000 mortgage deals have been removed in the last few weeks – yet there are still 3,000+ deals out there … and most are still fixed rates.

    Also, let’s not forget that 1 in 5 people rent today and are protected from all this, yet in 1988, only 1 in 14 rented.

    Therefore, the economic conditions surrounding the house price crash in 1988 and 2008 are not there now.

    Don’t get me wrong, those homeowners coming off their fixed rates of around 2% in the coming years will have to make tough choices as they will see their monthly mortgage payments rise substantially.

    Yet, as I have discussed in other articles, extending your mortgage term can significantly affect your monthly mortgage payments and there are things that homeowners should be doing now to mitigate the issue in the coming few years.

    But back to the question, should people wait to move, and what will happen to Sale property prices?

    I believe that subject to nothing seismic happening in the world, Sale property values will be broadly neutral and slowly drift downwards over the next 24 months. I believe they will drift because of the issues of inflation and mortgage affordability, yet we won’t have a crash for the points made in the first part of this article. I believe Sale property will be selling for sums of 4% to 6% less in a couple of years compared to today.

    This means if we achieve prices of 4% to 6% less, homeowners will still be getting the same prices the property market was getting in the summer of 2021 – again – nobody was complaining about those!

    However, let us assume I am wrong with my thoughts, and we see a significant house price crash; what then?

    Well, let me look at the last two house price crashes first.

    The housing crash of 1988 saw the average house in the UK drop from £63,784 to £50,167, a drop of 20.09%.

    The housing crash of 2008 saw the average house in the UK drop from £184,132 to £154,065, a drop of 16.33%.

    So, let’s assume that Sale house prices fall by 18% – surprisingly, it will not help Sale buyers.

    In previous house price crashes, people tend to find their careers are more at risk, and in turn, their wages don’t rise as much. It is the younger generation (i.e., first-time buyers age range) that often gets hit the toughest by these recessions.

    Let me look at Sale first-time buyers.

    If Sale first-time buyers wait until 2024 to buy and Sale property values drop by 18%, that will prove more expensive. Let me explain why …

    In the last property crash of 2008, lenders withdrew 5% deposit mortgages. The smallest mortgage that first-time buyers could obtain was with a 10% deposit, and even those were hard to come by.

    When writing this article, first-time buyers can obtain a 5% deposit mortgage for a fixed rate of 3.92% for five years.

    The typical first-time buyer terraced house in Sale sells for £300,145.

    If first-time buyers were to buy now, on this mortgage deal, they would have to find a £15,007 deposit, and their monthly mortgage payments would be £1,248.87 per month.

    So, let’s say property values in Sale do drop by 18% in the next 24 months; the terraced house would now be worth £246,119, a significant saving in the purchase price.

    Or is it?

    Everyone believes the Bank of England will raise interest rates further, so let’s assume they go to 5.5% by the autumn of 2024. That will mean the rate for a 10% deposit first-time buyer mortgage will be in the early 7%’s, so let me assume 7.19% (because the lenders have in the past increased the gap between the Bank of England base rate and the mortgage rate in more challenging economic times to allow for the extra risk).

    The monthly mortgage payment in two years on the 7.19% mortgage would be £1,444.72 per month, and in those two years, you would have had to have saved an additional £9,605 to make up your 10% deposit of £24,612.

    So even if Sale’s house prices did drop by 18%, the first-time buyer would be £2,350 worse off a year in mortgage payments (and would have to save many thousands extra for their deposit)

    … and then there is the other cost of waiting.

    You have two years’ worth of rent to pay. The average rent for a Sale property is £1,200 per month.

    If you waited a couple of years for Sale house prices to drop by 18%, you would spend £28,800 in rent plus have higher mortgage payments in 2024/5/6 and with the extra deposit mentioned above it would add up to an additional £45,455 over the next five years.

    Yes, the price you paid for your Sale home would be lower if you waited two years. Yet, you would only benefit from that when you sold on versus the economic pain of two years of extra renting, the higher deposit and higher mortgage payments in a couple of years.

    This doesn’t even consider the emotional cost of putting your life on hold for two years, and there is no guarantee that the mortgage lending criteria in two years would allow you to step onto the property ladder.

    So, now I have shown that waiting will cost you financially and emotionally, what are your thoughts on the matter?

    Sale house prices will drop, yet did you realise it will cost you more, even if house prices are falling?

    Do you believe the doom-mongers, or do you believe in the robust nature of the British economy?

    Don’t forget, George Osbourne said house prices would drop by 18% in May 2016 if we voted to leave the European Union, whilst many economists said house prices would fall by 5% to 10% when Covid hit in March 2020.

    And we all know what happened to those predictions now.

    If you believe you will be better off owning your own Sale home rather than renting one, don’t bother to wait for the suggested house price crash that may never happen.

    These are my thoughts – what are yours? Let me know in the comments.

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    House Prices Ought to be Falling – these are the reasons they are not.

    Looking at the newspapers with their doom and gloom headlines, you would think that the Sale property market (and the British property market) would be on its knees.

    Lets have a look at Sale as an example.

    Ring some Sale estate agents for a viewing or free valuation, and if you can get an appointment within a week to ten days, you are doing well!

    British properties continue to sell in good numbers.

    In July and August 2022, sales have been agreed on an average of 25,476 UK properties per week.

    Interesting when compared to the averages of 27,351 sales agreed per week in 2021 and 26,382 sales agreed per week, year to date in 2022.

    So why is the Sale property market defying all expectations?

    It is because there is an absolute shortage of properties to buy on the books of Sale estate agents, meaning Sale house prices are being kept buoyant (as demand exceeds supply).

    Today, there are 356 properties available to buy in Sale. Roll the clock back to October 2007, the month before the last house price crash, and it was 1,918.

    That’s 81% fewer properties to buy today in Sale than the month before the property crash.

    Notwithstanding suggestions that the Bank of England’s higher interest rates would peter out British house price growth, the continued limited supply of properties coming onto the market has helped Sale house prices climb.

    Sale house prices are 13.2% higher today than a year ago.

    Nevertheless, there is evidence that the insane demand for property has started to ease, and supply is increasing, which means that the direction of the Sale housing market will begin to change in the coming months.

    This can be seen in several ways.

    Back in January and February (2022), 8,094 UK properties per week were reducing their asking prices, whilst this July and August that had risen to an average of 13,115 UK properties per week. This is significant as some ‘optimistic’ homeowners who placed their properties on the market in the spring and early summer have had to reduce their ‘optimistic’ asking prices to attract buyers.

    Also, the number of UK house sales falling through (i.e., when the sale is agreed yet the sale falls through before the legal paperwork is completed) is starting to creep upwards from an average of 5,558 properties a week in the spring of 2022 to 6,854 per week in July and August 2022.

    Sale house prices have risen over recent times; the latest figures are based on what was selling in the late winter/early spring of this year and subsequently completing the sale in the early summer.

    The prices obtained by the estate agents on properties achieving a sale in Sale today (i.e. in the autumn of 2022) are slightly lower than what was obtained nine months ago. This means the house statistics published in early spring 2023 will slightly reduce. Nothing to worry about – I want to give you a heads up and not to be concerned. The simple fact is …

    we are returning to a more normal Sale housing market this autumn, compared to the crazy last 30 months since the end of lockdown one.

    With UK inflation standing at 9.9%, this brings an interesting scenario for Sale property values.

    Reducing ‘real’ wages will hit first-time buyers and existing homeowners’ disposable income, while the same high inflation will make the Bank of England increase interest rates.

    These things will significantly reduce homebuyers’ capacity to afford their mortgages as the fewer people who can take out a mortgage; the fewer buyers will buy homes.

    The Bank of England base rate currently stands at 1.75%, yet forecasts suggest it could end the year between 2.75% and 3%. Yet let us not forget the long-term average over the last 50 years has been between 7.1% and 7.2%, and many mature Sale homeowners will remember Bank of England Base Rates of 17% in 1979, so these sorts of increases are still off a low base.

    During these autumn months though, the lack of properties on the market and available to buy still support Sale house prices. The newspapers compete for attention and use clickbait titles to generate more interest in the publications.

    The simple fact is that unless something seismically happens in the world to change things materially, the Sale and British property markets will continue to harden slowly and will face some different challenges compared to the last 30 months, but fundamentally Sale house prices will remain broadly neutral over the next 12 to 18 months.

    These are my thoughts; what are yours?