They Dont Make Them Like They Used To...Fen Ditton Investment.

The title is absolutely true and this Three Bed in Ditton Fields is such a good example of that. It offers bigger reception space and bigger bedrooms well as a fantastic sized garden compared to anything built after its era. On the market with Tucker Gardner it would not need anything doing to it and would rent at £1200, the asking price is £285,000 so expect a yield of 4.8%. Not bad considering it would rarely be empty due to location.

http://www.zoopla.co.uk/for-sale/details/35686154

No. Of Cambridge Rental Properties Set To Rise To 14,800 By 2021

I was having an interesting chat the other day with a couple of solicitors at a Cambridge business networking event, when the subject of a lack of property for first time buyers came into the conversation.  I followed the chat up with an email with my findings, findings that I would like to share with you today.

At the time of the last census in 2011, 3,401,675 properties in England were privately rented, of which it is estimated,  over 1.25 million were owned by private landlords. The rapid growth of buy-to-let is hugely controversial, especially as only ten years before that, there were only 1,798,864 properties under private renting in England. Buy to let landlords have been held responsible for forcing up property prices and preventing our younger generations from being able to buy. There is also growing resentment toward the billions of pounds in tax relief (estimated to be nearly £10 billion) landlords claim on their mortgage interest -tax relief which is not available to homeowners.

They may be asset rich thanks to recently rising property values, but let us not make the landlords the bogiemen they could easily be. Despite all these benefits enjoyed by private landlords, let us not forget the good they have done, especially in Cambridge.

Property values today in Cambridge are still 4.5% below the 2007 property boom levels (2007 being the peak of last property boom before everything dropped in 2008/9), yet inflation has risen by 26% in the same time frame, so in real terms, properties today are 21.5% CHEAPER than they were in 2007. Just think how low they would be without landlords buying all those rental properties in the city. Interest rates are at an all time low and first time buyers only need to save a £8,000 deposit to secure a lovely 1 bed apartment in the Southeast Cambridge area  with a 95% mortgage. Forget what the papers say, first time buyers can borrow money relatively easily on a 95% mortgage and nine times out of ten, it’s cheaper to buy than rent. So why aren’t people buying?

The number of people choosing to rent, either for lifestyle or economic reasons, has grown over the last 15 years. I also believe they will continue to grow for some time to come (as does every report on the subject). In fact I would go as far to predict the number of rental properties in Cambridge will have risen from the 11,170 properties recorded in 2011 to 14,800 by 2021. Sounds fanciful? Well in 2001, there were only 7,295 privately rented properties in Cambridge.

It is a fact that we as a Country are more and more turning into a European model when it comes to homeownership, where the norm is renting for the first ten years, as opposed to the norm from the 1960’s to 1990’s, where first time buyers were encouraged to buy as soon as they got a job.

Tenants, in particular, will also feel the benefit from potential changes in the market. The likelihood of interest rate increases in late 2015, existing economic conditions, combined with the uncertainty of new Government manifestos following the General Election in May will result in low demand for people to buy yet also put a dampening effect on increases in rent. As long as landlords buy the right sort of property, that allows for a reasonable yield, decent capital growth, everyone will be a winner. If want a  chat about what would make the best sort  a property that would offer that in Cambridge, then please email me on cambridge@northwooduk.com 

  

 

Fully Refurbished 1 Bedroom Apartment

 

Offered for sale by our friends "my online estate agent" is this one bedroom apartment that is absolutely stunning inside. It is newly built and has been advertised for students as the location is absolutely on point ! so why not buy it and rent it to those students who want quality but don't have the deposit to buy? Achieving £1100 pcm if you move quickly and get it for the asking price that's a 7.3% yield, before you say it YES you do have lease charges but even after this you still have a great investment.

http://www.zoopla.co.uk/for-sale/details/36303309

Cambridge Property Values .. the long climb back to 2007 values

 

 Some landlords have been speaking to me recently about stories in the press and their concerns about local property market. They have been concerned that property values seem rather high and were worried about paying too much for their next buy to let property. In the past few years, if you were going to be buying in Cambridge, it was vital to ensure you build in some capital growth by buying cheaply or finding a way to add value.

As my regular readers of the Cambridge Property Blog will note, the most important consideration you will make before investing in property is the balance between annual return/yield and the annual value increase/capital growth. However, what affects those two things (yield and capital growth) in Cambridge are very varied and complex. The quantity of property and whether property is owner occupied, social housing (posh words for council housing) or private renting has a big difference on yield and capital growth. Interestingly, property values in Cambridge have increased by an impressive 10.2% in the last 12 months.  So are properties too expensive?

Looking at the market and looking at every property sale in Cambridge that sold in 2007 and again in the last few months of 2014, property values are on average 29.5% higher today in Cambridge than they were in 2007 (the peak of last property boom), even more impressive when you consider they dropped by 19.4% in 2008/9. On the face of it, a 10.2% increase over the last 12 months in Cambridge property values is notable, especially as those same property values are 29.5% higher than the boom of 2007.  Surely this suggests properties are too expensive in Cambridge?

Well, the answer is both Yes and No.

Yes, the headline sales price that Cambridge property is currently selling for, is 29.5% higher than 2007, yet No, because these headline sales price figures don't take into account inflation. Since 2007, inflation has been around 26.2%. So instead of property values being 29.5% more expensive than the 2007 boom, they are in fact only 3.3% more expensive than the boom in real terms (29.5% house price growth less 26.2% inflation equates to the 3.3%). People think inflation is a bad thing, eating away at the real value of your savings. It can however, be advantageous to property investors. 

 My answer to landlords is get the best advice and opinion you can. Speak to me, speak to others, do your homework and drive a hard bargain when buying, thus ensuring when prices do start to rise again, you are in pole position.

 

 

 

Balsham Investment offering 5.5 % Yield !

A fantastic three bedroom semi detached property on Mays Ave has just came on with Kevin Henry. It is very spacious and you could literally move straight in. There is no chain and has utility room, downstairs toilet and enclosed rear garden. It will rent at £1300and even if you paid full asking price you would have a 5.5% yield, grab a bargain before its gone !!

http://www.zoopla.co.uk/for-sale/details/36171430

Fen Ditton with a comfortable 5% Yield

 

 

 

A three bedroom character property is on the market with Leaders, it offers huge potential with three double bedrooms and two reception rooms you will not struggle to instantly rent this one. It is located on the outskirts of Fen Ditton and is on the market for £299,995. The rent should achieve £1300 a month giving a comfortable yield of 5%.

http://www.zoopla.co.uk/for-sale/details/36223240

Auction Properties are worth a look.

 

 

I think nowadays people are under the impression that auction properties are not a great idea, because you could end up in a bidding war and potentially over pay for something, my opinion on it is KNOW YOUR LIMITS.

 

So set yourself a floor and ceiling price and see how it goes, after all what have you got to lose? Your ceiling price still delivers a yield you will be happy with and anything from the ground up is a bonus?

 

Check out the link below, this Studio Flat on Alpha Road is basic don't get me wrong but the location is absolute prime. Returning a yield of 4.7% at my realistic ceiling price within the auction and potential to rise to the sky dependant on how good at negotiating at auctions you are (or how much the other person is willing to pay of course)

 

The market is heating up now and we are going to have lots of deals becoming available so watch this space

 

http://www.zoopla.co.uk/for-sale/details/36186939

 

 

 

 

 

The way it works is, you have to rent where you want to live, or buy where you don’t want to live

 

 

After the end of the Second World War, just over a Quarter of the UK population owned their own home, the rest rented from private landlords or the local Council. If someone told you in the 1970’s and 1980’s that they rented, they were considered a second class citizen. Everyone wanted to own their own home .. it was the done thing We think that home ownership will inevitably happen, but it won't.

It all changed in the 1970’s, when two things happened. Firstly, the number of people who owned their own home broke through the 50% barrier in 1971 and by 1981 it was at 57%. Tied in with that, the average house prices in Cambridge were doubling at one point every four years in the 1970’s so property and profit started to feed off each other.

 To put that growth in context, if we were to look at the last 85 years in Cambridge, in 1930, the average Cambridge property was worth £725. It took 16 years for Cambridge property values to double, rising to £1,792 by 1946. Another 15 years and the average Cambridge property doubled again to £3,402 in 1961. The next doubling only took 10 years, as by 1971, the average Cambridge property had reached £6,918 in value.

It was (as mentioned above) the 1970’s when things really took off, as by 1975 (ie only four years) they had doubled to £14,478 and they doubled again to £28,982 by 1980. It took another eight years for values to double again, as an average Cambridge property reached £60,622 in 1988. Twelve years had to pass until the doubled again in 2000 (£124,731) and just six years to double again by 2006, when they reached £251,567.  Where are we today? The average property value in Cambridge currently stands at £372,400

 We could blame Maggie Thatcher for making home ownership the ultimate goal, but what we now to need to consider that the country is turning on its head and we need to, as a Country,  love renting again. Some blame the banks, but obtaining a 95% mortgage is hard work, but nowhere near impossible. A typical Cambridge first time buyer would only need to save £12,500 for a deposit and they could buy a very decent 1960’s three up two down in Arbury in Cambridge, and it would be over £100 cheaper a month in mortgage payments (on a 40 year mortgage) than renting.

People might say on the surveys they want to buy, when it comes down to it. If you living been living in a lovely two bed apartment in Trumpington for £1100 per month, or even a lovely Victorian terraced in a hip and trendy area of Cambridge for not much more per month, but the bank will only lend you enough to buy a town house in Arbury, and don’t get me wrong, Arbury has really pulled its socks up over the last ten years, but it isn’t Trumpington, is it? What would you do? Look again the title of the post ... “The way it works is, you have to rent where you want to live, or buy where you don’t want to live,”

 That is why more and more people are getting into buy to let in Cambridge. With the new rules on pensions and the ability to use them to buy residential rental properties from April onwards, this could be the time for you to buy a rental property. You must take advice on your pension from a Independent Financial Advisor (there are plenty in Cambridge) and you must take advice from people who know what to buy (and not to buy) in Cambridge to ensure you get the best from your investment. One place for such advice is the Cambridge Property Blog  http://cambridgeproperty.blogspot.co.uk/

 

 

 

 

A New Breed of Silver Landlord Has Arrived

 

 

Thanks to changes in pension regulations coming into effect in April people aged 55 and over will be able to access part or all of their pension pot.  At a time when stocks remain volatile and interest rates are low, the prospect of owning a rental property that provides both a regular income and appreciates in value has much appeal.

It is no surprise that the upcoming changes in legislation are encouraging a new breed of landlord. Recent research revealed that 1 in 3 people aged 45 to 64 with a pension would consider using some or all of their pension to fund a buy to let property as an alternative to a more traditional pension fund. These potential landlords – popularly labelled as ‘silver landlords’ have quite widely varying reasons for investing in property with nearly 43% interested in a regular income. Some 23% are attracted by the perceived security of the investment and 17% by the expected capital appreciation

The UK private rented sector (PRS) has seen significant growth in the last two decades, having doubled since 1996. There are now an estimated two million private landlords in the UK who own and rent out 4.4 million homes – that’s almost one in five homes across the country.

I have been seeing a lot of interest from potential silver landlords looking for an appropriate Buy to Let investment. In response to the new legislation the opportunity for those approaching retirement to invest in property are opening up in a way that has never been possible before.

Encouraged by both steady gains in capital appreciation of property and increasing tenant demand, it’s easy to understand why Buy to Let is considered an attractive alternative to the more traditional pension funds. However, whilst many potential silver landlords will appreciate the basic concept of investing in bricks and mortar, it is vital to understand that any property purchased for rental purposes needs to be treated as the investment it is.

The key to successfully letting out a property is to find the tenant demand first and then the property that will meet that demand. This is where the expertise of an experienced, knowledgeable local agent is invaluable.  So why not pop in and see me at our office on the Mill Road and I’ll be happy to look over any properties you are considering…… guide you on the locations that are worth investing in, and give you an estimate of the rental income you could achieve.

Cambridge.. good time to buy property?

Ok, a slight turn of phrase there on the classic, an Englishman’s home is his castle but when it comes to the UK  the ‘Brit’s are still a nation of homeowners ‘(although wasn’t it Napoleon who thought we were all shop keepers!). It  is interesting to note that up until the mid to late 1960’s, more people rented their home (albeit mostly from the local council) than owned their own. In fact, I was surprised to read that in 1921, over 75% of homes in England and Wales were privately rented with the remaining 25% being owner occupied. 

 It was only after the Second World War, when the Beatles were rocking, that people started to buy instead of rent .. but instead of owning our property outright, we borrowed money from banks and building society’s to buy them and the roots of the growth of the private rental sector can be drawn back to the late 1970’s early 1980’s, when the council houses began to be sold off under the right to buy scheme. Even though 22,443 households in Cambridge were owner occupied in 2001 and that number had only dropped to 22,171 households by 2011, the percentage of homeowner properties in Cambridge dropped drastically from 52.6% to 47.4%.  Why, because whilst an additional 4,056 properties were built in Cambridge between 2001 and 2011, a lot of them were bought as buy to let investments, thus more than doubling the number of private rental properties in Cambridge. In fact, the number of properties in Cambridge, that were privately rented jumped from 7,295 in 2001 to 11,170 in 2011!

 With stagnation in the number of people who own their home in Cambridge and no more council houses being built, this is increasing the number of people looking to renting, as everyone needs a roof over their head. With the Cambridge City Council house waiting lists being in the 5 to 10 year range for a decent property in a decent location, it shouldn’t be forgotten that it is Cambridge landlords who house tenants waiting for a council house. Cambridge landlords do not receive any subsidies from HMRC and income tax is paid on rent paid by the tenant combined these reduce the cost on the tax payer.

 However, it’s not all doom and gloom in Cambridge, as we have noticed more and more of the younger generation are renting because they can‘t afford to buy (raising a deposit being the sticking point for most), and a high percentage of the expansion in private renting actually from those who need and want temporary accommodation. There are even a few landlords who rent their own Cambridge property out for the short term, for ease, and not necessarily purely for profit.

 Therefore, with every report stating the rental market will continue to grow throughout the rest of this decade, with high demand and limited supply in the Cambridge, if you are considering buying a property for investment in the near future in Cambridge, I am always happy to give you my considered opinion on which property to buy (or not as the case may be) to give you what you want from your investment. If you are a landlord, new or old, I am certainly more than happy for you to pick up the phone or visit the Cambridge Property Blog  www.cambridgepropertyblog.com

1 bedroom in Trumpington with a 9.43% return.

On the market with Tucker Gardner is this rare opportunity to purchase something that has CB in the postcode for less than stamp duty that isn't shared ownership. Perfect for a quick rental as no work required which makes the asking price even more appealing. Grab yourself a bargain and rent it at £800 a month and you will net a 9.43% yield, take out some for lease charges and you will still be quid's in.



                                   http://www.zoopla.co.uk/for-sale/details/36075125