44% Drop in Southampton Council Houses in the Last 40 years

 ·         In 1981, 30.1% of properties in Southampton (and  Southampton as a whole) were council            houses. Today, that figure stands at 16.9%, a proportional drop of 44%.

 ·         Why has the number of council houses dropped so much in those 40 years?

 ·         How has that changed the dynamics of the Southampton property market in those 40 years?

 

The ability of local authorities to build council houses came into law in July 1919 with the 1919 Housing and Town Planning Act. It was one of the most important pieces of domestic legislation passed after WW1 and was the first time in the UK that a nationally public funded system of providing homes was made for the masses. It was paid for mostly by central government and provided by local authorities (councils) and public utility societies (which in later years became today’s housing associations). 

 

Between 1919 and 1979, 6.94 million council houses were built.

 

Just over 1 million council houses were built between 1920 and 1939, whilst 5,804,150 council houses were built between 1946 and 1979. This is compared to 4,533,440 private homes and 260,910 housing association properties in the same time frame (’46 to ’79).

So, between 1946 and 1979, the council house was the dominate force of British housing. But that all changed in 1979!

Many people believe it was Margaret Thatcher who was the architect of allowing the sitting tenant of a council house to buy their home. Interestingly, council house tenants have been able to buy their council house from as early as the mid-1930s, albeit with little or no discount. Also, as late as 1977, the Labour Housing Minster published a Green Paper extolling the virtues of homeownership and council tenants being able to buy their home at a discount.

But after the General Election of 1979, the new Tory government drafted the Housing Act 1980, which gave the Right to Buy, which became law in the autumn of 1980. Then things really took off!

This new law established a right for most council tenants who had been in their home for three years or more to a discount. The discount started at 33% and increased by 1% for each extra year, up to a maximum of 50%. If the tenant sold the house within the first five years of ownership, a prorated repayment of their discount was required.

 

Between 1980 and 1989, 970,558 council houses nationally were sold at a discount.

Yet the issue was, when a council house was sold, it took that house out of the council’s portfolio for future generations. From the start, there were limitations on local authorities’ use of monies from the council house sales as most of it had to be given to central government in London, meaning only 390,560 new council houses were built between 1980 and 1989. Looking at the numbers locally …

In 1981, there were 22,688 council houses in Southampton today it’s 16,633.

No wonder the country has a housing crisis ... yet as my regular readers know - the devil is in the detail … and that devil is the humble housing association. 

The Tory General Election Manifesto in 1979 had proposed the rights for both council house and housing association tenants to buy their own house under the Right to Buy scheme. The Conservatives argued housing associations, who obtained government funding, should be subject to the same Right to Buy proposals as councils. The Government won the vote in the Commons, yet lost the vote in the Lords, meaning housing association tenants could not buy their homes at a large discount.

At the time, there were only 400,000 housing association properties in the country, so the Government were not that worried. But the significance of housing associations developed in the 1980s and beyond as they were allowed to borrow money from the private sector.

Between 1949 and 1979, the average number of housing association properties built annually was 8,524. Since 1979 to today, it has been 25,062 per year (and 31,606 per year in the 2010s).

Also, the Government encouraged councils to transfer their remaining council houses to housing association schemes from 1986. The advantage to these ‘stock transfers’ was the Government allowed housing associations to access private funding to improve their existing properties and buy new ones (good news for existing tenants complaining that the local authority never upgraded their homes).

Moreover, the Tory Government liked stock transfers, as it allowed them to dismantle council housing from the inside. Interestingly, Labour expanded the ‘Stock Transfer’ process in 1997 and further reduced the eligibility for council tenants’ Right to Buy, meaning the number of council tenants exercising their Right to Buy declined considerably.

Meaning today, even though the provision of council housing has dropped like the proverbial stone … 

the number of housing association properties in Southampton has increased from 1,868 in 1981 to 6,234.

So, how has this changed the dynamic of the Southampton property market in the last 40 years?

Would it surprise you to learn that the number of people who own their Southampton home today is very similar to what it was 20 years ago before the property boom started? It’s just that even though we’ve had a large drop in the number of council houses and an increase in the number of housing association properties, the number of people owning their home has remained relatively stable (in some areas of Southampton this has actually increased), the significant issue is the growth of the private rented sector in Southampton.

 

It's almost as if people who used to rent from the council now rent

from a private landlord.

 

The question is, is it right for private individuals to make money from tenants who rent from them as opposed to the local authority? Or are private landlords providing better types, choices and quality of accommodation for these tenants, albeit at a higher rental rate than if they rented a council house?

I really do believe if it wasn’t for the growth of the buy-to-let landlord, which began in the early 2000s, we would have an even bigger housing crisis on our hands than the one we currently have.

Both local and central government have had their hands tied behind their backs since 2008 with a lack of funding, and it’s the humble private landlord who has stepped up and supplied in excess of 2.3 million additional rental properties since 2001, housing nearly 5,520,000 tenants. These landlords have saved the day since the big council house sell off in the 1980s!

 

What are your thoughts on this matter?

How to Be a Stress-Free First-Time Buyer in Southampton

 

Taking that first step on the property ladder is simultaneously exciting and terrifying. No matter how old you are, buying your first property will make you feel like a proper grown-up. Before you even find the right property, there’s lots to learn, so in this quick read, we’ve pulled together our top five tips for first-time buyers.

 

Be mortgage savvy

There are so many different options when buying a first home – whether you’re getting a loan from the bank of mum and dad, wading through Help to Buy admin, or going it alone. In every case, a mortgage is the first step you need to take.

For a rough estimate of how much you’ll need to borrow, there are plenty of online tools that can help. You could also speak directly to your bank or high-street lender about their mortgage deals. If you need some extra help, speak to us about a financial adviser or mortgage broker. We work with plenty of first-time buyers and have all the info you need.

 

Be real

When you first start looking, it’s important to be realistic about your budget. By looking at properties way outside your price range, you could find it harder to see the potential in those that suit your current financial situation. Get yourself a vision board and focus on the things you really need from a new home.

 

Be in the know

Newsflash: not all properties are on Rightmove or Zoopla. While these sites give you a good idea of what’s available and for how much, by registering with agents such as ourselves, we keep you in mind (and updated) before something even goes online.

There’s nearly always competition for a property, so it’s best to speak to experienced agents and register what you’re looking for instead of just relying on the internet.

 

Be open

You might have a very specific list of requirements, such as area, parking, outside space, and so on. However, it’s important to be flexible when you view a property. It might not tick every item on your list, but it may also have tonnes of potential. Always view a property before you rule it out.

 

Be calm

Once you’ve found a property, stay calm. If you’ve got your mortgage sorted, you’ve got a conveyancer, and you’re regularly in touch with your agent, there’s no need to worry. We understand there’s a lot to get done before you exchange; our job is to help you take any stress away.

 

We have served many first-time buyers at Belvoir over the years, and we’re ready to help you get your feet on the property ladder. Contact us on 02380018222 today or email me brian.linehan@belvoir.co.uk

Why Does it Take 124 Days to Get the Keys When You Buy a Southampton House?

·             -    4,224 properties have sold in the Southampton area in the last 12 months.

·             -    It only takes 54 days to sell a Southampton home, so why does it take 124 days from the sold board going up to the buyer getting the keys?

·             -    With a shortage of solicitors and a sub-standard conveyancing system, this article discusses   what Southampton house sellers (and buyers) can do to speed up the house buying process.

 

Nationally, the average length of time it takes from agreeing the sale of a property to the keys being handed over is 111 days (down from 117 days last year), yet in Southampton, we are above the national average at 124 days.

So why does it take just under 18 weeks, when all that is required is the lawyers to look at some paperwork and get a mortgage? Also, what can Southampton homebuyers and sellers do to speed this up? 

The legal process to buy and sell a UK property is called conveyancing. The conveyancing system itself hasn’t really changed in hundreds of years. After the housing market was reopened after the first lockdown in the spring of 2020, the property market returned with a bang, helped on with the stamp duty holiday.

In 2021, the number of properties selling in Southampton in some months went up massively, e.g., by 96% June 2021 and by 65% in March 2021. Many conveyancers and solicitors had to sort the legal paperwork out for upwards of 120 to 150 properties each at any one time.

 

This glut of sold properties caused by the pandemic that needed legal work to be sorted exacerbated a problem already present in the conveyancing industry.

 

For years conveyancers have complained of overwork and underpay. Conveyancing is seen as the Cinderella of the legal profession. This workload was the straw that broke the camel’s back, making many conveyancers leave the profession and go into better paid legal work like corporate work.

Also, the legal process of conveyancing has built-in inefficiencies, and the conveyancing profession has been relatively slow to innovate. However, there are some excellent tech solutions that are being slowly rolled out across the industry to make the process more efficient and effective.

 

What can Southampton home buyers and sellers do to speed up their property sale?

 

If you are buying or selling your Southampton property as we speak, you won’t be able to wait for the conveyancing profession to be revamped, yet you can be as pre-emptive as possible to get your Southampton house sale through earlier.

In a nutshell, ensure you have all the paperwork sorted on your Southampton home before you put your home on the market. Next, get the ball rolling on your mortgage. If you receive some paperwork, read it, check it, sign it and send it back in a day, do not leave it a week; finally, always communicate frequently with your estate agent and conveyancer.

When you instruct a solicitor, most will request money to start the ball rolling for searches and disbursements. They won’t lift a finger until that is paid.

You will have to prove who you are in the conveyancing process, so your conveyancer will ask you to show them proof of ID and address. If you are buying, they will need to prove you have the funds/deposit to buy the home (and if your deposit is coming from family/friends, then they are required to write a letter to that effect).

 

How can the house buying and selling process be improved?

 

A couple of years ago, the Government set up the Home Buying and Selling Group to find the answer to this problem. Chaired by the well-known property guru Kate Faulkner, it is looking at an amalgamated Seller’s Information Pack (SIPs) and an IT-based single platform to share and communicate that SIP between buyers, sellers, their conveyancers, the estate agent, mortgage providers and brokers and finally surveyors.

 

The advantage of the SIP is that it can be created before the buyer has been found, meaning property buyers would be more knowledgeable when making an offer. Also, once the sale has been agreed upon, the SIP could be sent straightaway electronically to the buyers’ legal team (from the seller’s legal team) to start the procedure of asking for searches and raising inquiries.

 

The bottom line is the conveyancing process is not fit for purpose in the 21^st century and change is on the horizon.

 

So, before the SIP becomes mandatory, there are things everyone can do to ensure they get the home of their dreams quicker.

At my agency, I recommend the seller, us as the agent and the conveyancer start to liaise with each other to get the key information on the property being sold as quickly as possible. Then once a buyer is found, I believe it is vital we, as the agent, regularly communicate with all the stakeholders in the chain to ensure everyone is playing their part to expedite the sale.

In the future, utilising technology and every agent/conveyancer preparing information upfront with the SIP will drastically reduce the time it takes between agreeing a sale and the keys/monies handed over.

 

The conveyancing process will have to change to meet the needs of the 21^st century, but how long that will take is the big question.

If you would like to chat with me about how we do things differently to ensure your property not only gets the best price and how we do all we can, as agents, to expedite a smooth sale for your Southampton property, do not hesitate to pick up the phone to me on 02380018222or drop me a line at the office on brian.linehan@belvoir.co.uk

1 in 3 Southampton Homeowners Unable to Sell

         -          The average time to find a buyer for a Southampton property reduced from 64 days in                   2020 to 54 days in 2021.

 

·                        -              Yet still, almost 1 in 3 Southampton homeowners are on the market after 12 weeks.

 

·                        -             Why are so many Southampton homes still on the market after all that time, and what                   does it mean for the Southampton property market?

 

You would have needed to have been living in a cave since the end of Lockdown No.1, not to realise the property market has been on fire in Southampton (and the UK as a whole) for the last 20 months.

It has been very much a seller’s market, especially in 2021. Yet as we enter the second quarter of 2022, I have noticed a slight rebalancing of the Southampton property market, more towards buyers, something that is good news for everyone (sellers and buyers) locally.

In 2020, it took on average 64 days from the average Southampton property appearing on the property portals (i.e. Rightmove, Zoopla etc) to the property going sold (STC).

Interesting when compared to the national average of 72 days in 2020. Yet, last year, this was reduced to 54 days in Southampton (51 days nationally).

Well, that was last year, and things have changed slightly since.

 

Of the properties for sale in Southampton 29.3% of houses have been on the market for more than 12 weeks.

 

That doesn't sound a lot, yet that is an eternity in this market!

So, why are there so many properties on the market in Southampton still for sale after all this time … it usually comes down to one thing … the practice of 'overvaluing'.

So before I explain what overvaluing is, let me give you some background.

Many agents (not just ourselves), in 2021, were achieving top prices for Southampton property with multiple offers becoming the standard. The property they were selling was only available to buy for days before the owner obtained multiple offers that were not only at a satisfactory level, yet more than they ever dreamed likely.

Although this was great news for Southampton homeowners, this caused fewer homes to come onto the market in the last six months in Southampton, as people were afraid to put their home on the market without having a property to buy.  

With fewer properties coming onto the market, some estate agents have become more and more desperate to get a larger slice of this smaller property market. It has seen an unwelcome side of the estate agency profession, the estate agency practice of ‘overvaluing’.

While ‘overvaluing’ is nothing new, the custom has been generally limited to a small number of estate agents. Yet now, it's become more prevalent and creates uncountable distress and pressure for some Southampton homeowners.

Many Southampton homeowners want to sell quickly to get the property of their dreams. Yet, in many cases, when they do put their property on to the market, they don’t sell quickly enough because of this ‘overvaluing’ (even with the fantastic current property market conditions).

To give you an idea of the issue…

64% of Southampton homes put on the market in the last 30 days have not sold.

There are hundreds of Southampton families having their dreams dashed by 'overvaluing.'

Therefore, let me look at exactly what overvaluing is, why it’s on the rise and most importantly, the harm overvaluing causes to homeowners like yourself.

You would think the most important thing in estate agency is all about finding the best buyer for your home, at the best price, who can make the move with the least amount of hassle.

To us it is, and to many other Southampton estate agents, it is as well. Yet, to some agents, sales aren’t the essential objective. Instead, it is having a vigorous catalogue of properties to sell to generate more future leads.

Deprived of an endless number of new properties for sale, the enquiries estate agents receive will significantly drop, leaving them high and dry without any buyer (or seller) leads, the lifeblood of estate agents.

Therefore, some (not all), but some estate agents will feed on a homeowner’s appetite to get the highest possible price for their Southampton home by giving them an over-inflated suggested asking price to market their property at (i.e. ‘overvaluing’).

If one estate agent can get you an extra £30,000 for your Southampton home, you will take it, won’t you?

The suggestion of pushing the asking price of your Southampton home for 10%, 15% even 20% could be seen by many as a temptation too good to miss. Yet once you are on the market, the agent is trained to slowly get you to reduce your asking price over a lengthy sole agency agreement.

The problem is that the home of your dreams might have sold by the time you reduced your price in 3 months. Also, Which reports in 2017 and 2019 proved you ended up getting less for your home when it did eventually sell (which means you lose money) and finally, the agents know homeowners perceive it’s a hassle to swap agents (which it isn’t).

But estate agents only get paid when they sell the house; why do they overvalue?

Would it surprise you that some Estate Agency chains pay their staff a commission when they put the property on to the market, not when it sells? So, their team overinflate their suggested asking prices to get that commission.

Over the last 18 months, with the rising property market, there has undoubtedly been a valid reason for pushing the envelope on the asking price. Yet, if every house like yours is on the market or sold subject to contract at £300,000 to £320,000, yours isn’t going to achieve £355,000, let alone £375,000 – even in this market.

With 64% of Southampton homes still for sale after a month, the market is starting to level out and if you are keen to sell, then let me give you some advice.

 

Research has shown that if the asking price is initially set too high, it will be ignored by people surfing Rightmove and Zoopla.

 

(Come on, be honest – you have done that yourself haven’t you?)

When the property is eventually reduced because it has the stigma of being on the property market too long (begging the question of potential buyers that there may be a problem with the property itself hence no interest?), often when it does eventually sell, it will sell for less than what it would have done if it were priced correctly from day one (as per the two reports from Which in 2017 and 2019).

Of course, on the other hand, setting the asking price below its market value means potentially leaving money on the table needlessly – hence the need for a good agent.

Putting your Southampton home or buy-to-let investment up for sale at the right price from the beginning is the key to selling within the best time frame and for the best price to a serious and motivated buyer.

Ask a handful of estate agents to value your home, ask them to back up any valuation of your Southampton home with cold hard comparables of similar properties to yours.

Find your comparables by searching ALL the property portals (i.e. Rightmove, Zoopla, Boomin, OnTheMarket).

If you only take away one thing from this article, when you search the portals for comparables, make sure you include under offer/sold STC properties, as that will triple the comparable evidence. 

Thus, by doing your homework and then working with a dependable, trustworthy and experienced Southampton estate agent, who will help to ensure that your Southampton property is put on the market to get you, the homeowner, the best price from day one without over cooking it (so you don’t lose out), you will be just fine.

These are my thoughts, let me know if you have any yourself.

 

How Will Rising Inflation Affect the Southampton Property Market in 2022?

The UK is currently experiencing its highest inflation rate since the early 1990s. This increase in prices has primarily come about by the combination of an increase in demand for goods and services from consumers following lockdown last year together with global supply chain disruptions.

Most economists weren't too concerned about this increase in the inflation rate as the very same thing happened in the early 1990s following the Credit Crunch with a similar rise in demand and supply chain issues. Thankfully, back in the early 1990s, inflation returned to lower levels quite quickly. However, the situation in Eastern Europe now could change matters.

So, let me look at all the factors and what it means for

the Southampton property market.

The crisis in Eastern Europe has sparked even further rises in crude oil, (which diesel and petrol are made from) gas and grain prices as pressure on supply chains around the world increases.

In my previous articles, I suggested UK inflation would rise to around 7% in the spring and drop back to 5% in the autumn and as we entered 2023, be approximately 3% to 4%.

Yet, with these issues, inflation could rise to 8% to 9% by late spring and still be around 6% to 7% in autumn, well above the Bank of England's target of 2%.

With Southampton wages rising at only 3% to 4% and inflation at 7%+,

Southampton household incomes, in real terms, will fall.

This is because ‘real’ UK household incomes characteristically have been the most consistent lead indicator of growth (or a drop) in house prices. This is because growing inflation erodes the value of the money you earn, which reduces its buying power. When the cash in your pocket has a lower spending power, people tend to spend less when they buy (and rent) a home.

Next month, Income Tax thresholds will be frozen, and National Insurance contributions are increasing. Collectively, all these issues will create a drop of around 2% to 2.5% in the real disposable incomes of Britain's households in 2022 (real disposable income - somebody's take-home wages after tax and then the effects of inflation are considered).

Will Southampton people be more anxious to spend their money?

With less money in people's pockets, people's inclination to spend the money they do have could also be curtailed. People's savings are at an all-time high, yet many will decide to sit on the cash, instead of spending it, especially as consumer confidence has dropped to minus 26 on the GfK index (whatever that means – but in all seriousness though - more on that below).

All this can only mean there is going to be a house price crash.

It’s all doom and gloom! … Or is it?

 

My heart goes out to people caught up in the awful humanitarian crisis in Eastern Europe. Yet, I respectfully need to put that to one side for just a moment for the purpose of this article.

This blog is about the Southampton property market, and Southampton people want to know what will happen to the Southampton property market.

In the first half of the article, I looked at the impending fall in real disposable incomes of 2% to 2.5% in 2022. I appreciate it's going to be tough for many families in Southampton. Yet, it is always important to consider what has happened in previous times.

 

1982 – a drop of 2.3% in real disposable income

1992 – a drop of 3.7% in real disposable income

2008 – a drop of 5.8% in real disposable income

Yes, it's going to be tough, yet we got through 1982, 1992 and 2008 – and so we shall in 2022/23.

Next, the price of petrol is very high compared to a year ago.

The average price of unleaded petrol is £1.65/litre today, quite a jump from the £1.21/litre a year ago. But, here is an interesting fact, petrol was a lot more expensive (in real terms) in 2011 than today. In TODAY's money, a litre of unleaded petrol in 2011 would be the equivalent of £1.79/litre.

We have some way to go before we get to those levels – and again, the Southampton economy (and property market) kicked on quite nicely after 2011.

 

What are Southampton people spending on their rent and mortgages?

Housing costs - owner occupiers were spending on average 17.3% of their household income on mortgages in 2015, yet in 2021 this had risen, albeit to 17.7% - not a huge increase.

Council house (social) tenants have seen a drop in their rent from 29.2% in 2015 to 26.7% in 2021, whilst private tenants from 36.4% in 2015 to 31.2% in 2021.

Interesting that private tenants are proportionally 14.29%

better off in 2021 than in 2015.

 

How we spend our money - the average UK home spent 4.2% of their household income on energy in 2021, and that is due to rise to 6.3% after April (and probably 7% in October). Yet, as a country, we spend 9% of our income on restaurants and hotels and 8% on recreation and culture. As with all aspects of life, it will mean choices, and maybe we will have to forego some luxuries?

Just before I move on from this aspect of the article, again I appreciate I am talking in averages. Many people with low incomes suffer from fuel poverty and they will find the increases in energy prices hard – my thoughts go out to you.

Interest rates - higher inflation is generally brought under control using higher interest rates, meaning mortgage payments will be higher.

First, 79% of homeowners with a mortgage are on a fixed rate, so any rise won't be instantaneous. Yet, there will be a bizarre side effect from the issues in Eastern Europe. Surprisingly, though the current situation in Eastern Europe, by its very nature, will bring greater UK inflation, it will also probably defer the Bank of England raising interest rates. This means mortgage rates won't increase as much as the bank won't want to exacerbate any pressures to the UK economy in 2023/24 caused by the conflict.

The stock market had priced an interest rate rise to 2% by the end of 2022. I suspect this will now be no more than 1% to 1.25% by Christmas, slowly going up in quarters of one per cent every few months. The crisis in Eastern Europe might even come to be seen as a defence for higher inflation throughout 2022, all meaning everyone's mortgage will be less.

Next, looking at Consumer Confidence Indexes - these indexes are fickle things. I prefer to look at the Organisation for Economic Co-operation and Development Consumer Confidence Index as it has a larger sample range and a longer time frame to compare against. Looking at the data from the mid 1970s, the drop in consumer confidence is big, yet nothing like the drops seen in the Oil Crisis of the mid 1970s, Recession of the early 1980s, ERM crisis of 1992 and the Global Financial Crisis of 2008/09. Also, when compared to the other main economies of the world (G7), the UK has always bounced back much more quickly from recessions when it comes to consumer confidence.

What about house prices in Southampton in 2022/23?

Increasing energy prices, rising inflation, an increase of sanctions, and a probable drop in consumer confidence and spending in the aftermath of the conflict will knock the post-pandemic recovery globally, which will lead to a recession around the world, including the UK.

A recession is when a country’s GDP drops in two consecutive quarters. For the last 300 years, there has been a direct link between British house prices and GDP – (i.e. when GDP drops, UK house prices fall). Yet in 2020, the British GDP dropped by nearly 12%, yet house prices went the other way. 

But, let’s look at what would happen if Southampton house prices did drop by the same extent they did in the Global Financial Crisis of 2008/09.

House prices in Southampton dropped by 17.4% in the Global Financial Crisis, the biggest drop in house prices over 16 months ever recorded in the UK.

The average value of a property in Southampton today is £237,369.

Meaning if Southampton's house prices dropped by the same percentage in the next 16 months, an average home locally would only be worth £196,066.

On the face of it, not good – until you realise that it would only take us back to Southampton house prices being achieved in March 2017 – and nobody was complaining about those.

Yes, that will mean if they do drop in price, the 8.4% of Southampton homeowners who have moved home since March 2017 would lose out if they sold after that price crash. But how many people move home after only being in their home for a few years? Not many!

 

The simple fact is that 91.6% of Southampton homeowners will

be better off when they move if house prices crash.

 

And all this assumes there will be a crash.

The simple fact is, the circumstances of 2009 that caused the property crash are entirely different to 2022 (no lending by the banks, higher interest rates and increasing unemployment compared to today’s increased lending, ultra-low interest rates and low unemployment environment).

I do believe with all that's happening in the world we might see a rebalancing of the Southampton property market later in 2022 and could see the odd month with little negative growth in house prices, yet it will be nothing like 2009.

The expected fall in household spending could be counterbalanced by UK businesses’ plans to invest more in their businesses (with last year’s tax breaks on investing), which will create even more jobs.

Who knows what the future holds? These are just my opinions – what are yours?

 

1 in 53 Homes are Sitting Empty in the Southampton Area

 

·       2,075 homes in the Southampton area are empty, which represents 1 in 53 homes.

·       888 of those have been empty for more than six months and are worth £211million.

·       Why are those properties standing empty and deteriorating and why could that become an issue for the whole of Southampton?

A couple of weeks ago was National Empty Homes Week, so I thought I would find out how many homes are empty in the Southampton area - the numbers surprised me, so I wanted to share my thoughts about them with you.

The latest Government statistics show that 888 properties in Southampton have been empty for more than six months.

Homes that are left empty for an extended period can affect our locality and occasionally invite anti-social behaviour.

With a shortage of housing in the Southampton area, these empty homes must be brought back into use to generate much-needed housing for local people.

As you can see in the first bullet point, some homes are only empty for a short period of time. Yet, those local properties that stand empty for more than six months and then deteriorate become a problem for our local community.

I appreciate there can be many genuine explanations why a property may be left empty for a long time. However, with council house waiting lists at high levels and the shortage of both properties to buy and rent in Southampton, we must ask what is being done about this at Government level and how this could affect the Southampton property market?

The collective value of these 888 long-term (6 months or more) empty houses in Southampton are worth £211million.

This impacts the Southampton housing market with a lack of properties coming onto the market for sale and rent. This results in house prices being pushed up, making it less affordable for first-time buyers to get on the first step of the housing ladder.

It’s a real shame that many local properties are empty for over six months when there is an increasing demand for accommodation, at a time when there’s such a competitive housing market.

So, one might ask if this issue of long-term empty properties is a new problem? Well, not really.

There were 776 homes long-term empty in Southampton in 2010.

I know our local authority likes to work with property owners of empty homes to bring them back into housing stock as it helps with the housing shortage, even with the help of grants if improvement work is needed for the empty home. Yet, they could use enforcement action where a homeowner is incapable or unwilling to bring their property back into use.

 

So, what is the Government doing nationally? Homeowners are charged a 50% premium on top of their Council Tax if their home has been empty for two years or more. This can rise to a 300% premium if the property has been empty for ten years or more.

However, the bigger question is, why are all these homes in the Southampton area being left empty?

The real answer is - they are not.

A handful of the properties belong to the local authority and are in poor condition because the tenant trashed the property. 

Probate (where the person's estate is put in order and passed onto the beneficiaries of the will) takes between six and twelve months. Most of these long-term properties are being modernised and renovated, whilst other Southampton properties are part of a deceased estate. In other circumstances, some Southampton homes have been left empty after the owner has been placed into a care home, yet there is no Power of Attorney to put the home onto the market. 

There is no 'one fix all' to the empty home syndrome in Southampton. 

Empty properties in Southampton is not the issue that will sort the housing crisis we’re suffering from.

The simple fact is the population is growing faster than the number of houses being built. We need to build more homes.

Whether that means council properties, housing association homes, private landlords or even owner-occupation housing the masses - that's a massive question we could all talk about, day in day out until the cows come home.

So, tell me, what are your thoughts on the matter?

 

Southampton Household Heating Bills Set to Rise to £166,314,444 in 2022

 

The energy bills of every Southampton resident will rise in April as the price cap increases to account for the global increase in the cost of gas. Those not on the gas mains will still be hit as the UK uses gas to make 45% of its electricity.

So, what can Southampton residents do to reduce their energy consumption and ultimately save money?

Firstly, let's look at the scale of the costs.

Considering the increase in energy prices from April, the combined energy bills for the whole of Southampton come to …

·         £166,314,444 for central heating

·         £33,347,025 for hot water

·         £18,122,360 for lighting

There are extra energy costs for washing, fridges, etc., yet I wanted to focus just on the home as this is a property blog.

Everyone's bills will be around 50% more expensive in 2022 than in 2021, but it’s not too late for Southampton people to take some quick steps to cut their energy bills and, at the same time, cut our carbon footprint.

Just over a quarter of the UK’s carbon comes from heating and lighting our 27.6 million homes, and each UK home produces 4.39 tonnes of carbon dioxide a year.

Upgrading the energy efficiency of UK homes is seen as a vital step to attempting to mitigate the issues of climate change, fuel poverty and our nation's energy security.

So, what are some quick wins for Southampton residents to reduce the energy bills on their homes, and how will energy efficiency play a more significant part in the value of Southampton homes in the future?

1.    1.    By turning down the thermostat by 1 degree, the average saving would be an average annual saving of £105.91 per home and each homes carbon dioxide would be reduced by an eighth of a tonne (it all adds up!).

2    2.    Replacing your bulbs when you can with energy-efficient bulbs will, on average, reduce your lighting costs from £172 per year to £103 per year.

3.   3.    What time does your heating come on and off? Could it come on later and go off earlier?

4.   4.    Smart meters (which are installed for free) are estimated to help lower UK homes’ electricity use by nearly 3% and gas use by 2% … again it’s all margin gains.

 

These are just a handful of ideas. Check out the internet for others as it's fascinating how much energy we use for overfull kettles, chargers left on and tech on standby etc.

Yet, these things will only scratch the surface … many of us will need to go further, especially Southampton landlords, to retrofit our properties to make them more energy-efficient.

This is particularly important as in June the Government announced they would make the country carbon neutral by 2050, meaning Britain’s homes need some enormous retro-fitting to meet these ambitious climate targets.

In 2018, the Government required private landlords to improve the energy rating of their rental properties by prohibiting the rental of any property with an Energy Performance Certificate (EPC) rating of F and G (the lowest ratings). Yet from 2025, that will be increased to C for all new tenancies and 2028 for all existing tenancies (more on these EPCs below).

I don’t believe there is an appetite to mandate private homeowners to do this work, though you never know in the future.

So, how do you find out about your Southampton home’s eco-credentials?

Since 2007, every new home that has been built, rented out or put on to the market in Southampton has had to have an EPC, giving it a rating between A and G (rather like those stickers you see on fridges and washing machines).

A is the highest rating (i.e. best energy efficient and greener), and G is the worst efficient rating.

43.3% of Southampton homes are in that eco-friendly A to C energy performance band rating, compared to the national average of 40.1%.

So, what next? Well, the Government will attempt to make the green revolution as painless as possible with technology.

In the future, we might have hydrogen central heating instead of mains gas; or have solar panels for electricity, all triple glazed windows and even ground source heating - sounds fanciful? Well, who would have thought some of the most wanted cars would be electric 20 years ago?

There is no doubt that the energy efficiency of our homes will rise in the coming years as the cost of fuel increases and people's opinion on going green changes.

You don’t need to spend thousands of pounds to find out what you can do to make your property greener and cost less. Look at your EPC 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 the EPC rating of your Southampton home, go to epcregister.com.

If you need an EPC, drop me a line as I know some great local energy assessors that can easily do an EPC on your property at a price that won't cost the earth!