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Friday, 16 August 2019

The Southampton Monopoly Board


Board games seem a thing of the past for youngsters nowadays with their consoles and mobile phones yet a family favourite in our household that will bring young and old together is Monopoly.


Mayfair is the square everyone wants to buy and whilst it is the most expensive to buy – it offers the greatest returns. Mayfair was the must have London address when the Monopoly board game was made in 1935 when, at the time, it was the most expensive street to buy houses at £400 each. A member of my family asked me what a property today would be worth in Mayfair and how much it would cost to buy them all. Readers will know I like a challenge. My research shows that a typical house in Mayfair today costs on average £2.8m - whilst the total value of all the property in the Mayfair area currently stands at £11.8bn.

The fun part of Monopoly was to build more houses and ultimately a hotel to extract the maximum rent from the other players who landed on the square. That made me think, instead of looking at the average value of a property on the street, what if we looked at the total value of property on the whole street. So, I carried out some research on all the 216 streets in SO14 and calculated the top 20 streets in terms of their total value of all properties on the street..  and just for fun, colour coded them as if they were on a Monopoly board  …


Mayfair and Park Lane are represented by Channel Way and Ocean Way .. no surprises there, yet there are some surprises in the mix including Golden Grove and St Marys Road. They are rightly in the list because of the sheer size of those streets; because whilst the value of those homes are much lower than the posher streets, the total value of the whole street means they make the top 20 list.



Now of course whilst drawing a comparison between a 1935 board game and the actual total house values on those Southampton streets and roads provides a light hearted point of view of the Southampton property market, it does present a credible picture of Southampton’s most popular streets. Next time I will get back to writing an article with a little more seriousness and deeper issues on the Southampton housing market … but this week, I hope you enjoyed my little bit of fun!

If you would like to pick my brains on the Southampton Property Market – pop in for a coffee or drop me a line on social media or email. 

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.

Don't forget to visit the links below to view back dated deals and Southampton Property News.

Friday, 9 August 2019

Only 40.4% of Southampton Households are Eco-friendly



Improving the energy efficiency of Britain’s 27.2 million homes, which are responsible for more than a quarter of the country’s CO2 and other greenhouse gas emissions, is seen as key to tackling the issues of climate change, fuel poverty and our country’s energy security. This is particularly important as in June the Government announced they were going to make the country carbon neutral by 2050, meaning Britain’s homes need some enormous retro-fitting to meet these ambitious climate targets.

Researchers at Nottingham Trent University said it would cost on average £17,000 per property to retrofit an average UK home to make it carbon neutral with renewable energy and insulation (if done en masse and not piece meal). That would cost the Country £462.4bn (interesting when the NHS costs £154bn per year). Now of course 22.7m homes are privately owned so that would be the responsibility of the owners, but if we look at publicly owned council housing, that would cost the Government in excess of £76.5bn - HS2 is ‘only’ £56bn!

The benefits of making homes carbon neutral go further than saving the planet, as occupants would have much lower gas and electric bills (which total £31.824bn per year), warmer households and a much-lower strain on the NHS, which currently spends about £848m a year treating conditions that arise from cold housing. Also, local authorities would have to spend a lot less than the £5.2bn a year for ongoing property maintenance by the installation of extra insulation and renewable energy such as ground source heating, wind or solar panels.

To improve efficiency ratings, last year the Government banned landlords from renting property with an energy performance rating of F and G (the lowest ratings), yet I don’t think there is an appetite to force private homeowners to do this work (although you never know in the future??). Homeowners would be unenthusiastic to take on the bother and cost of such building works, yet the Government could offer incentives and grants, which along with the funds saved on their energy bills could make the plan more appealing?

So, what about eco credentials of the properties of Southampton homeowners and landlords?

Every home that has been built, rented out or put on to the market in Southampton since 2007 has had to have an Energy Performance Certificate (E.P.C), giving it a rating between A and G (rather like those stickers you see on fridges and washing machines). A is highest rating (i.e. most efficient and greener) and G is the worst energy performance rating. So, looking at Southampton first, then comparing us to the rest of the UK, this is the result...
  

  
So, 40.4% of Southampton homes are in that eco-friendly A to C energy performance banding ratings, which is proportionally 8.84% higher than the national average.
So, what next? Well the Government will endeavour to make the green revolution as painless as possible with technology developments like LED light bulbs, for example, saving greenhouse gases without people noticing. In the future we might have hydrogen central heating instead of mains gas, all have solar panels for electricity, all triple glazed windows and even ground sourced heating ... sounds pie-in-the-sky? Well who would have thought some of the most wanted cars would be electric and hybrid 10 years ago, built by the likes of Tesla?
There is no doubt that the energy efficiency of a property will rise in the coming years as the cost of fuel and people’s opinion on going green changes. You don’t need to spend £17,000 to find out what you can do to make your property greener. Look at your E.P.C and it will tell you what small changes you can make to improve your Southampton home’s energy efficiency rating and ultimately save yourself money.


If you want to find your E.P.C rating of your Southampton home, go to www.epcregsiter.com

If you would like to pick my brains on the Southampton Property Market – pop in for a coffee or drop me a line on social media or email. 

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.

Don't forget to visit the links below to view back dated deals and Southampton Property News.

Friday, 2 August 2019

What's in a Southampton name?


I recently went to a local landlord gathering in Southampton, i met with some of the local landlords and we had general conversations about the amount of different Estate Agents in Southampton and what landlords expect from there Estate Agents, what I found was a lot of agents concentrate so hard on trying to win new business, that as soon as they have won a new landlord over and rented out their property, they pretty much forget about them and start the chase all over again. Wouldn't it be great if they took the time to at least get to know your name, your preferences regarding your property management style and what makes you feel comfortable as a landlord?

With almost 300 properties on our books and over 80 landlords, we are always in contact with a vast number of those people about one thing or another, and where one landlord might be quite liberal and easy going towards the actions of his tenants, another may well have stricter standards – for example, some will allow tenants to decorate to their own style, fix furniture to walls or undertake other improvements such as fitting extra radiators yet another landlord might not allow any of this, with the property having to stay magnolia and with a limited number of picture hooks put into the walls. This is where knowing your landlords and their preferences adds a personal touch, because as the agent we can then take a lot of the strain and buffer many of the requests that we get from tenants.

So if we get a request for a new fridge for one of Deans properties we already know his answer and how to handle it, whereas for Jane her answer and approach will be different, and on any given day when Kevin calls we immediately know his voice, where his properties are, what his tenants are like and the on-going issues and relationships he and they both have, and all of this means we can tailor our approach towards the very specific nature of the matter at hand and the people involved. We can do this because all of our staff are located in one location, and we are all constantly over-hearing and getting involved what is going on within all of the other roles within the office - there is no outsourcing to a remote call centre, no subcontracting of responsibilities, and you can always reach the same person who has been dealing with an on-going issue at any time.


We don’t offer a ‘one size fits all’ approach because clearly we are all different, the properties are of varying age, condition and specification, and sure as anything we get to see the whole spectrum of human nature demonstrated by tenants (which is in itself a whole blog article for the future). If you were to call your existing agent today, out of the blue, would they have a good enough relationship with you that they could already pre-empt your requests and the way you would like such an outcome to be achieved? Would they even remember your name?


You see, as someone made clear to me some time ago, being an Estate Agents is not just about property but is more about people and personality, because who would you trust to look after your best interests – someone in it purely for the money, or someone prepared to dedicate the time and effort to building a relationship with you such that trust, confidence, and ultimately a smooth transaction will naturally follow?

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.

Don't forget to visit the links below to view back dated deals and Southampton Property News.



Friday, 26 July 2019

13.3% of all Properties Sold in Southampton are New Builds



Of the 11,500 houses and apartments sold in Southampton (SO14) since 1995, 2,900 of those have been new homes, representing 13.3% 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 Southampton 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 Southampton, of the 16,800 households in SO14, 2,900 were built since 1995 (representing 17.3% of all households), meaning Southampton 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 Southampton landlords and Southampton homeowners.

If you would like to pick my brains on the Southampton Property Market – pop in for a coffee or drop me a line on social media or email. 

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.


CLICK HERE TO FIND OUT HOW MUCH YOUR SOUTHAMPTON PROPERTY IS WORTH

Don't forget to visit the links below to view back dated deals and Southampton Property News.

Friday, 19 July 2019

Southampton Homeowners Sell Their Home 3% More Than the UK Average


The average homeowner in the UK moves every 20.2 years…
That average in the 1970’s and 80’s was around every 10 to 11 years; in the 1990’s it increased to the mid-teens (in terms of years) and in the early part of the Millennium, it dropped again to the low teens. When we had the Credit Crunch years of 2008/09/10, that shot up to every 25.3 years and has been steadily decreasing ever since to the 2018 figure of 18.7 years.
The graph shows that as the economy improved after the Credit Crunch, British homeowners started to move home more and may have be taking advantage of higher demand and lower supply in the housing market to sell their homes and move on to the next property. Yet, most Southampton (and British) homeowners are more often than not buyers as well, so that cannot be the real cause. As mentioned already, people in the 70’s and 80’s moved a lot more than today.
So why is the long-term average length of time between moves since 2000 still much higher than it was in the preceding 30 years? For existing homeowners, some people have said their lack of an appetite to move home compared to the 1970’s and 1980’s might come down to their mortgages and the need for higher equity to put down on the next house. It is true the number of years you stay in your home determines how much you will pay back on the mortgage you took out when buying it. If you stay longer, you have the prospect to pay back a larger portion of the money you borrowed to buy the home. Interestingly, if you consider someone with a 25-year mortgage on the UK average variable rate of 3.4% for existing mortgage borrowers, borrowed say £200,000 at the start of the mortgage and made monthly payments on that mortgage, it would take 15 years and 1 month to build up over 50% (or £100k) in equity (and 17 years 2 months if interest rates were at their historic average in the 1980’s and 1990’s of 7%) … all assuming there was no decrease in value of the property.
Instead, I think the issue is a lot deeper than that. Firstly, I believe there has been a long-term change in attitude to moving home and this lack of people moving home (compared to the last 30 years of the 20th Century) is part of a slowdown in the country in social mobility. Interestingly, a million fewer people moved in the noughties (2000 to 2010) than in the 1970’s, after other changes in population have been taken into consideration. You see back in the 1970’s and 80’s, it was expected that people kept moving up the ‘property ladder’ to bigger and better homes (i.e. keeping up the Jones’).
Secondly, there has been a change in attitude to homeownership per se … as 20 to 30 somethings (Generation Rent) have been weaning themselves off the ‘homeownership drug’ for the last 15 years that the baby boomers were addicted to in the 1970’s and 80’s ... meaning there are less buyers at the bottom of the housing ladder to fuel the fire. That is an important factor on the long-term decrease in home moving as buy to let landlords have been buying the smaller style starter homes to house Generation Rent … yet landlords don’t tend to move up the housing ladder after a few years like first time buyers - landlords just buy another property.
So, what is happening in Southampton with regard to people moving home?
I have mentioned a number of times in my articles about the Southampton property market, that the number of people who move home (i.e. the number of property transactions) is a more important bellwether to the health of the local property market.
Therefore, I compared the number of people moving home in Southampton to the regional stats of home movers and the country as a whole. I also decided to look at a long-term point of view to judge the Southampton housing market, because as can be seen on the first graph, there is often short-term volatility. Looking at the stats...  
Since 1995, Southampton people have moved home 3.61% more often than the national average


Looking at this second graph, 81.8% of the Southampton (SO16 to be precise) privately owned housing stock has been sold since 1995 - interesting when compared to the regional figure of 94.1% and only slightly above the national figure. Why? Well I am sure this might be the topic of an up and coming article on the Southampton Property Market Blog.

If you would like to pick my brains on the Southampton Property Market – pop in for a coffee or drop me a line on social media or email. 

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.

Don't forget to visit the links below to view back dated deals and Southampton Property News.

Friday, 12 July 2019

Southampton Council House Waiting List Drops by 48.6% since 2011


In 1979, more than 4 in 10 British people lived in a council house, yet today that figure is only 1 in 12, whilst according to Shelter 65% of families on the Council House waiting lists had been on those lists for more than a year and 27% had been waiting for more than five years.

One solution to the housing crisis has always been for the local authority to build more homes, yet should the state provide people with secure and dependable places to live – or is that an out-dated point of view? To look at this objectively, let’s take a step back.

After WW2, both Tory and Labour governments were building council houses in massive numbers, yet it might surprise you to know that more Council houses were built per year under Tory Governments than Labour ones between the years 1945 and 1970.  

Everything changed in 1979, when Margaret Thatcher delivered the right for Council tenants to buy their Council House (called the Right To Buy Scheme). Interestingly, Right To Buy was a Labour Party idea from one of Labour Manifestoes of the late 1950’s (although they lost to the Tory’s). Mrs Thatcher’s idea was based on massive discounts and 100% mortgages for those buying … but this was the real issue that has come back to bite us all these years later! Half the proceeds of the property sales went back to Westminster and the other half went back to the local authority – but the Councils half could only be spent on reducing their debt – not to be spent on building more Council houses.. hence why we have a shortage of council houses.
In 2011, Central Government gave local authorities the power to limit people’s entitlement for social housing (aka Council Housing), hence removing those people that did not have an association or link to the locality.


Today, in Southampton, the Council House Waiting List has dropped by 48.6% since 2011, meaning

8,351 families are waiting for a Council House
in Southampton

Interestingly though, if our local Council House Waiting List had changed by the same amount as the national one, the waiting list figure would be 9,929 instead, because nationally Council House waiting lists are only 38.6% lower than 2011.

So where are these Southampton families all living and what does this mean for Southampton homeowners and Southampton Landlords?

Quite simply, private landlords have taken up the slack and housed all those people that were on the waiting list. This is important as more and more tenants are stopping longer in the Private Rented Sector - the average length of time of a tenant stays in the same property is now 4 years. Renting is becoming a choice for many, as the years of this Millennium roll on. So much so, would it surprise you to know that renting a house can be more expensive than buying it as we have these ultra-low mortgage rates and 95% mortgages freely available?

Rents in the Rental Sector in Southampton will increase steadily during the next five to ten years. Even though the Council House Waiting List has decreased, the number of new council and housing association properties being built is at a 75-year low. The government campaign against buy to let landlords together with the increased taxation and the banning of tenant fees to agents will restrict supply of private rental property, which in turn using simple supply and demand economics, will mean private rents will rise – making buy to let investment a good choice of investment vehicle again (irrespective of the increased fees and taxation laid at the door of landlords). 

..and for home owners (and landlords) Southampton property values will remain strong and stable in the medium term, as the number of people moving to a new house (and selling their old property) will continue to remain limited, meaning that due to lack of choice and supply Southampton buyers will have to pay decent money for any property they wish to buy (especially ones in good locations and presented well).


Interesting times ahead for the Southampton Property Market!

If you would like to pick my brains on the Southampton Property Market – pop in for a coffee or drop me a line on social media or email. 

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.

Don't forget to visit the links below to view back dated deals and Southampton Property News.

Friday, 5 July 2019

Do We Have the Right Sort of Southampton Homes For the 21st Century?



Would it surprise you to know that in some parts of Southampton, predominantly prosperous areas with high proportions of mature residents, the housing crisis is not one of supply so much as dispersal of that supply? Theoretically, in Southampton there are more than enough bedrooms for everyone - it’s just they are disproportionately spread among the population, with some better-off and more mature households living in large Southampton homes with many spare bedrooms, and some younger Southampton families being over crowded.

Yet it is not the fault of these well-off mature residents that this is the current situation. Let’s be frank, Southampton doesn’t have enough housing full stop (otherwise we wouldn’t have the large Council House waiting list and all the younger generations renting instead of buying), but up until now it hasn't been clear that Southampton actually also has the wrong types of properties.

We're not building the smaller homes in Southampton that are needed for the starter homes and we aren’t building enough bungalows for the older generations, so they can be released from their larger Southampton homes, thus allowing those growing Southampton families to move up the ladder.  

Looking at the stats for Southampton, and SO15 in particular...



When I compared Southampton (SO15) with the regional stats of the SO postcode, the locality has proportionally 91.3% more apartments, yet 71.3% less detached homes. Looking nationally, Southampton (SO15) has proportionally 133.7% more apartments and proportionally 65.3% less detached homes.

I am finding that there has been a shortage of smaller townhouses and smaller apartments being built in Southampton over the last 20 years, because most of the new builds in the last couple of decades seem to have been either large executive houses or the apartments that have been built were of the larger (and posher) variety, even though demand for households (as life styles have changed in the 21st Century) have been more towards the lower to middle sized households.

The builders do want to build, but there's a deficiency of building land in Southampton, and if there's a shortage of building land, then of course new homes builders build whatever gives them the biggest profit. The properties that give them the largest profit are the biggest and most expensive properties and they certainly are not bungalows as they take up too much land. So who can blame them?

Yet would it surprise you to know that it’s not a lack of space (look at all the green you see when flying over the UK), it’s the planning system. Green belts must be observed, but only 1.2% (yes 1.2% - that isn’t a typo) is built on in this country as a whole with homes - we need the planners to release more land (and then force/encourage builders to build on it - not sit on it). Another problem is that of the smaller new homes that have been built, most of them have been snapped up for renting, not owning.

So, what’s the answer? Build more Council houses? Yes, sounds great but the local authority haven’t enough money to cut the grass verges, let alone spend billions on new homes in Southampton. The Government did relax the planning laws a few years ago, for example for changing office space into residential use, yet they could do more as currently new homes builders have no incentive to build inexpensive homes or bungalows that the system needs to make a difference.

So, what does this mean for Southampton homeowners and Southampton landlords?

Changing the dynamics of the Southampton, regional and national property market will only change in decades, not years.  The simple fact is we are living longer, and we need 240,000 to 250,000 houses a year to stand still with demand, let alone start to eat into 30 years of under building where the average has been just under 170,000 households a year.


That means, today as a country, we have a pent-up demand of 2.25m additional households and we need to build a further 4.2m households on top of that figure for population growth between 2019 and 2039. So, irrespective of whether we have short term blip in the property market in the next 12/18 months, investing in property is, and always will be, a great investment as demand will always outstrip supply.

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.

Don't forget to visit the links below to view back dated deals and Southampton Property News.

Friday, 21 June 2019

Southampton House Prices Up 3.0% in a Year

What does that mean for local Landlords and Homeowners?




The balancing act of being a Southampton Buy To Let landlord is something many do well at. Talking to numerous Southampton landlords, they are very aware of their tenants’ capability to pay the rent and their own need to raise rents on their rental properties.  Despite the ‘perceived ‘dark clouds of Brexit, evidence suggests many landlords feel more confident than they were in the Summer and Autumn of 2018 about aiming to push rents higher on their Southampton Buy To Let properties.

Looking at the data for the last 7 years, this shows that throughout the Summer months, the rents new tenants have had to pay on move in have increased at a higher rate than during the colder months of Winter.  This is because the Summer months are normally a time when renters like to move, meaning demand increases for rental properties yet supply remains pretty ridged.

Yet the Winter stats buck that trend and this is great news.

Rents in Southampton on average for new tenants moving in have risen 2.4% for the month, taking overall annual Southampton rents 2.7% higher for the year

However, several Southampton landlords have expressed their apprehension about a slowing of the housing market in Southampton and I believe, based on this new evidence, they may be overstated.  Before we get the bubbly out though, the other part of investing in property is what is happening to capital values (which will also be of interest to all the homeowners in Southampton as well as the Southampton Buy To let landlords).   I believe the Southampton property market has been trying to find some form of balance since the New Year.   According to the Land Registry….

Property Values in Southampton are 3.0% higher than they were 12 months ago

Yet, these figures reflect the sales of Southampton properties that took place in the late Autumn of 2018 and now are only exchanging and completing during the Winter / early Spring months of this year.

The reality is the number of properties that are on the market in Southampton today has risen by 1% since the Autumn


and that will have a dampening effect on the property market.  As tenants have had less choice, buyers now have more choice .. and that will temper Southampton property prices as we head into the middle of 2019.

Be you a Southampton landlord or Southampton homeowner, if you are preparing to sell your Southampton property in 2019, it’s important, especially with the rise in the number of properties on the market, that you are pricing your property realistically when you bring it to the market.  With the likes of Rightmove, Zoopla and OnTheMarket on everybody’s mobile phones and laptops, buyers have access to every property on the market and they will compare and contrast your home with other properties like yours – and will more than likely dismiss your property rather than view it.

To all the Southampton homeowners that aren’t planning to sell though – this talk of price changes is only on paper profit or loss.  To those that are moving .. most people that sell, are buyers as well, so as you might not get as much for yours, the one you will want to buy won’t be as much.  Look at the deal as a whole, the difference between what you sell yours for and what you buy at.  Finally, all the Southampton landlords – keep your eye’s peeled – I have a feeling there may be some decent Southampton buy to let deals to be had in the coming months. 

If you are looking for an agent that is well establishedprofessional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on brian.linehan@belvoir.co.uk or call on 023 8001 8222.

Don't forget to visit the links below to view back dated deals and Southampton Property News.