The combined value of Southampton’s housing market has
fallen by £322,117,401 in the last 6 months, meaning the average value of a Southampton
property has decreased in value by an average of £4,911.
This is great news for Southampton first time buyers and Southampton
buy to let landlords, as there is a slight hesitation in the market because of the
uncertainty over Brexit. As I have always said, investing in Southampton property, be it for you to live in or as a buy to let
investment, is a long-term game. In the grand scheme of things, this minor
change over the last 5 or 10 years is nothing.
The RICS’s latest survey of its Chartered Surveyor
members showed that nationally the number of properties actually selling has
dropped for the 16th month in a row. Locally in Southampton, certain sectors of
the market are matching that trend, yet others aren’t. It really depends which
price band and type of property you are looking for, as to whether it’s a
buyers or sellers market.
The RICS also said its member’s lettings data showed a lower
number of rental properties coming on to the market. Anecdotal evidence
suggests that (and this is born out in the recent English Housing Survey
figures) Southampton tenants over the last few years are stopping in their
rental properties longer, meaning less are coming onto the market for rent. I
have noticed locally, that where the landlord has gone the extra mile in terms
of decoration and standard of finish, this has certainly helped push rents up (although
those properties where the landlord has been remiss with improvements and
standard of finish are in fact seeing rents drop). Southampton tenants are
getting pickier – but will pay top dollar for quality. So much so, I believe
there will be a cumulative rise of around fourteen to sixteen per cent over the
course of the next five years in private rents for the best properties on the
market.
Back to the Southampton Property Values though …
This drop in Southampton property values doesn’t
particularly concern me. The fact is that over the last 6 months 1,662
properties have sold for a combined value of £460,905,840. You see, that
drop must be seen in perspective in that 6 months ago, the total value of Southampton
property stood at £19,164,903,108 (£19.16bn),
and today it stands at £18,842,785,707 (£18.84bn)
.. this change is a drop in the ocean.
In the short term, say over the next six months and assuming
nothing silly happens in Korea, the Middle East or Brexit negotiations, it will
be more of the same until the end of the year. In the meantime, the on-going
challenges ensuring we as a Country build more homes (although the Office of National Statistics figures released in July
showed nationally the number of new homes
started to be built over the second Quarter of 2018 had dropped dramatically) makes me think that Southampton
(and Nationally) property value is likely to recommence an upward trajectory as
we go into 2019.
One final thought for all the buy to let landlords in Southampton
(and indirectly this does affect all you Southampton homeowners too). I do hope
the recent tax changes towards buy to let landlords don’t bite as deep as it is
possibly starting to with certain landlords I know. We talked about this in an article a few
weeks ago and I know why the Government wanted to change the balance by taxing landlords
and providing a lift for first time buyers .. however, this may well come at
the expense of higher rents for those Southampton tenants that don’t become
first time buyers, as the appeal of buy to let potentially weakens.
If you are looking for an agent that is well established, professional andcommunicative, then contact us to find out how we can get the best out of your investment property.
Email me on brian.linehan@belvoirlettings.com or call on 023 8001 8222.
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