With the underlying fundamentals of a shortage of properties coming
to the market and the continued low mortgage rates, as well as buyer motivation
being high due to those inexpensive lending rates and general demand caused by
under supply. So as the trees turn from green to hues of red and
brown, the Warminster property market has a confident feel to it.
Now of course, there are a few potential hurdles coming towards us in
the coming months that could affect the Warminster (and UK) property market. Mrs.
May has yet to get her teeth into Brexit negotiations and we don’t know what
the US Presidential elections might do to the money markets around the world,
meaning that on the run up to Christmas, some savvy buyers may take advantage
of the lack of certainty by making cheeky offers. But I don’t believe these
will have a huge impact on property values (like the 2008 Credit Crunch).
You see, property ownership, whether it’s for yourself as a
homeowner or buy to let landlord, is a long term investment. In fact, focusing
on buy to let, a number of our landlords who own property in Warminster have recently
been asking for my thoughts on the future of the buy to let market in Warminster.
Well, as the Politician Edmund Burke said in the 18th
century, "Those who don't know history are destined to repeat it." ..
in other words, to see the future I believe you must look into the past.
Since
the Millennium, the housing market has had everything thrown at it. The recent Brexit
decision, last year’s General Election, the near melt down of the World Economy
with the Credit Crunch, The Dot Com boom and bust, the housing market crisis in
2008/9, the housing boom of 2001 to 2004 .. the list goes on. In fact here is a
graph (courtesy of the Land Registry) of average Property values since the
Millennium in the Wiltshire Council area.
Even though we had the Dot Com bubble burst in 2000, two
years later in January 2002, property values in the Wiltshire Council area have
risen from £101,400 (in Jan 2000) to £129,000 .. and kept rising to September
2007, when they peaked at £227,100. Then we had the Credit Crunch and property
prices continued to fall until April 2009, where they averaged £185,800 .. but
look where they are now… £258,100.
The point I am trying to get across is long term future property
values are more helpful to landlord investors than the month by month headline
grabbing micro movements in the property market.
Look at the graph and you will see the growth
in property values is an upward trend BUT, the average darts about as each
month goes by. So don’t watch the
property indexes and panic if values drop next month or the month afterwards,
because even in the glory days of 2001 to 2004 and 2012 to 2014, without fail,
values always dropped slightly around Christmas, but people will always need a
roof over their heads, and if they can’t buy and the council aren’t building
anymore .. only buy to let landlords in
the private rented sector can meet that demand.
Warminster
landlords are being hit in the pocket with the new up and coming taxation rules
and yes we might have a bumpy ride on the run up to Christmas (because of the
points raised earlier), Brexit or no Brexit, but the trend will be a slow and
steady upward momentum of property values, demand for rental properties and
yields in the Warminster property market into 2017 and beyond.
