Managing A Property Abroad: Five Things Southampton Landlords Should Know

Five Things You Should Know about Owning a Buy-to-Let Abroad

Investing in a buy-to-let abroad can be a tempting prospect. Owning your own little piece of paradise while earning a rental income can seem like a win-win scenario.

However, it’s essential to have realistic expectations about the challenges landlords face when managing a property overseas.

Here are five things to consider before investing in an overseas rental.

The distance factor

Managing maintenance and repairs is difficult when you live hundreds of miles away (especially if you don’t speak the local language). As a result, most landlords get an agent to manage the property for them. As you won’t be able to check what’s going on with your own eyes, you’re reliant on your agent to be true to their word.

Local rules 

Every country has its own rules about foreign property ownership, so do your research before you commit. If you plan to live in your property for part of the year and rent it out for the rest of the time, there may be limits on how long you can stay in the country. 

Tenant selection and communication

One of the biggest challenges long-distance landlords face is screening tenants. As it’s unlikely that you’ll be able to meet prospective tenants in person, you’ll need to rely on your managing agent’s judgement. And once they’re living in the property, communication could be problematic if the tenants don’t speak English and you don’t speak the local lingo.

Holiday lets

Some landlords opt to rent their property to holidaymakers on a weekly basis as they can usually charge more for short-term lets. However, as occupancy rates can fluctuate, your property could be empty for long stretches in the off-season. Also, there have been horror stories about people having their idyllic properties completely trashed by stag and hen parties, so you’ll need a clear strategy to deter troublemakers.

Tax implications

Always seek professional tax advice based on your individual situation. You’ll need to navigate the tax rules in the country where your property is located, as well as the UK. 

Do your sums

If you’re weighing up whether to invest in a buy-to-let at home or abroad, consider your priorities carefully. While it’s impossible to guarantee blue skies and sunshine in the UK, you may find returns and occupancy rates here in Southampton offer greater certainty.

Call us here at Belvoir Southampton today to discuss your buy-to-let investment plans for the future.

Southampton Homeowners: Miss The 1st Of June 2024 Deadline And You Might Miss Christmas In Your New Home

As May comes into view, with the anticipation of the warm summer months ahead of us, with sun-drenched hot beaches and cold ice cream, the thoughts and contemplations of Christmas seem a million miles away.

Yet many people who wish to move would like to be in for Christmas.

If that is you, listen up, as you might be surprised by what I tell you. Southampton home buyers and sellers dreaming of celebrating Christmas 2024 in a new home, the time to act is running out.

The property landscape has evolved significantly over the past few years, reflecting changes in buyer behaviour and the intricacies of the transaction process itself.

Recent statistics from the UK property market reveal some thought-provoking trends.

From April 2023 to April 2024, UK properties took an average of 69 days from listing their home for sale with an agent to an agreed sale, with a subsequent 112 days to completion (i.e. completion is when the keys and monies change hands). That’s a total of 181 days. This is a shift from the previous year (April 2022 to April 2023), where it took 47 days to secure a buyer and 124 days from agreement to completion.

That means if you placed your property onto the market in the first week of May, looking at the average amount of time to complete, you will be moving in the first or second week of November.

Southampton’s local figures align closely with national trends but with its unique nuances.

Between April 2022 and April 2023, it typically took 41 days to find a buyer and 143 days for the legal completion in Southampton.

However, these past 12 months have seen a lengthening in the initial part of the selling process. It now takes about 59 days to find a buyer, though the span from sale agreement to completion has slightly decreased to 129 days.

This means it takes the Southampton home seller 188 days from listing their Southampton home to moving out – just over six months.

These numbers paint a clear picture: selling a home and settling into a new one is not as swift as many might hope. Given these timelines, homeowners looking to move home by Christmas should ideally be putting their homes on the market by late May or early June.

This allows ample time for each phase of the selling process, from attracting the right buyer to navigating the legal intricacies with solicitors. It ensures that you can put up your Christmas tree and decorations in your new living room comfortably before Christmas.

That means if you want to move into your new home by Friday, 6th December 2024, you will need to put your home on the market by Saturday, 1st June 2024.

This is assuming you hit the average times scales mentioned above for Southampton.

Why the urgency? The current market conditions suggest a slower pace in securing buyers, which can be attributed to various factors, including economic uncertainties, changes in mortgage rates, and a more discerning buyer pool. The national reduced time from sale agreement to completion, however, indicates that once a buyer is secured, the process is becoming more streamlined – a positive sign for sellers.

Prospective Southampton sellers should also consider the advantages of the current property market.

With the extended time to attract buyers, presenting your property at its best has never been more crucial. This means addressing any maintenance issues, considering upgrades that increase property appeal, and staging your home to capture the imagination of potential buyers. Effective marketing through an experienced estate agency can significantly enhance visibility and attract quality offers.

Moreover, engaging with a knowledgeable Southampton estate agent early in the process can provide crucial guidance. They can help navigate the complexities of the Southampton market, advise on realistic pricing strategies, and manage the sale process to avoid common pitfalls that could delay proceedings.

For those contemplating a move, the message is clear: acting sooner rather than later is prudent. The market’s current pace means that starting the process in the next couple of weeks is essential to ensure you are settled in your new home in time for the festive season.

This isn’t just about moving house; it’s about moving home. It’s about ensuring that by the time December’s frost dusts the streets of Southampton, you are warm and settled, with the comforting scent of mulled wine wafting through your new home.

While the Southampton property market may present challenges, thorough preparation and timely action can pave the way for a smooth transition to your new home by Christmas. Remember, the perfect moment to put up your property for sale is now. Let’s make your festive dreams a reality – speak to your local estate agency today and take that first, decisive step towards your new beginning. 

How Mortgages Differ Around The World – A Guide For Southampton Homeowners

  If you’re paying off a mortgage on a property in Southampton, you’ll be well aware of how the mortgage market works in the UK.

But how do they do things in the rest of the world?

Let’s look at how people in other countries get on the housing ladder.

The Netherlands

While UK lenders offer the choice of a fixed-rate or variable mortgage, the Dutch do things differently.

A Dutch-style mortgage is a long-term deal (typically 20 to 30 years) in which the interest rate automatically decreases as the loan is paid down.

This means the Dutch don’t waste time and money re-mortgaging every couple of years to get a better deal reflecting their situation; their mortgage adjusts progressively to reflect their improved loan-to-value ratio.

You may also be interested to note that in the Netherlands, the interest you pay on the mortgage of your main residence is tax deductible.

The US

If you want mortgage certainty, you’ll find it in the US, where 15, 20 and 30-year fixed rate deals are the norm.

However, securing such a deal is tougher now than 15 years ago, as regulators tightened the lending rules after the 2008 financial crisis (which was partly caused by irresponsible mortgage lending).

It’s hard to believe, but in the early 2000s, ‘no-doc’ mortgages were readily available. Many Americans could get a mortgage without documenting that they could meet the repayments (the loans were known as NINJAs – no income, no job or assets).

As history shows, lending huge sums of money to people without verifying their ability to pay it back didn’t work out well for US banks or the rest of the financial system.

South Africa

First-time buyers struggling to get a deposit together in the UK should spare a thought for South Africans. Most SA lenders will only greenlight a mortgage if customers have a 50% deposit or a property they put forward as collateral.

In SA, fixed-rate mortgages are much less common than in the UK; most mortgages are on variable rates.

If you’re looking to take your first step on the housing ladder or move to somewhere new, contact us at Belvoir Southampton today.

How NOT To Sell Your Southampton Home: Five Mistakes That Deter Buyers

Most home sellers want three things: to get the best possible price for their property, to complete the sale in good time and to avoid bucket-loads of stress.

These three goals may sound simple and achievable, but you’d be surprised how many sellers lose their way during the marketing process. 

As a result, they waste time and money and cause themselves more anxiety than necessary.

To help you avoid a few common pitfalls, here’s a guide to how not to sell your home.

In other words, do these things, and you’ll be headed for delays and disappointment.

Fail to get three valuations

Most industry experts recommend sellers get three agents to value their property. This is because if you only have one valuation, you risk going too low with your asking price (and missing out on thousands of pounds) or too high (and deterring genuine buyers). Is it worth cutting corners just to save yourself a few hours?

Get greedy with the asking price

You take a punt and list your property at a price far above what similar homes in the area are going for. You hope a clueless buyer will breeze in and pay well above the odds for your home. However, savvy buyers aren’t fooled. They stay away, and the sale stalls until you drop to a realistic price. 

Don’t bother to declutter or depersonalise

Instead of offloading some of your belongings and having a tidy-up, you do nothing at all. The marketing photographs capture all manner of old toot, dirty laundry and mucky dishes. Potential buyers snigger at your choice of underwear (left hanging on the radiators) and quickly move on to another listing.

Make no effort for viewings

When buyers view your property, it’s a ‘warts and all’ experience. In between dodging your clutter and checking out the family photos on the walls, buyers notice the chipped paintwork and wobbly cupboard doors. They make an offer but take a few thousand pounds off because they know they’ll have to sort out this DIY work when they move in.

Respond sluggishly to requests for information

Once you’ve agreed a deal and the conveyancing process is in motion, you put your feet up. Instead of responding promptly to requests for information, you take your time. Your slow response irritates the prospective buyer – who is keen for a speedy transaction – and jeopardises the entire chain.

Looking to sell your Southampton home? Contact us here at Belvoir Southampton today for a free valuation. 

Top Tips For Attracting High-Quality Tenants In Southampton

 

Some landlords, actually many, have an ‘if it ain’t broke, don’t fix it’ approach to their rental property’s upkeep.

But by proactively refurbishing and modernising your rental properties, you can realise a host of benefits that will attract premium tenants and add long-term value to your investment.

Here are seven ways why, and how, astute property upgrades benefit forward-thinking landlords.

1. Attract premium tenants: By upgrading your rental, you ensure it meets high standards, making it more likely to be rented quickly, thus minimising those dreaded void periods.
2. Create better landlord-tenant relations: A well-cared-for property often inspires respect and care in return. This leads to fewer disputes and a positive, long-lasting relationship between landlords and tenants.
3. Achieve higher income potential: Quality upgrades can make your property appealing to a broader and more affluent demographic, thereby boosting your rental income.
4. Increase property value: Beyond the immediate rental income benefits, high-quality refurbishments can significantly boost your property’s market value, ensuring you gain both short-term income and long-term investment growth.
5. Encourage long-term tenancies: Tenants are more likely to stay longer in homes that are comfortable and free from issues, reducing turnover and the costs associated with finding new tenants.
6. Reduce maintenance costs: Proactively addressing wear and tear and upgrading ageing fixtures and fittings can drastically lower the need for emergency repairs and maintenance – saving you money, time and hassle.
7. Enhance energy efficiency: Making energy-efficient improvements contributes to environmental sustainability and reduces utility bills, making your property more appealing to eco-conscious tenants.

Making improvements to your rental property doesn’t have to break the bank.

Whether it’s a minor refresh or a comprehensive overhaul, it’s often money and time well spent.

Have you got a rental property question? Give us a call today on 023 8001 8222– we’re here to help.

Southampton Property Owners Reap £7,224 Yearly Gains Since 2001

  As we are now nicely into 2024, it’s certain the Southampton housing market over the last 18 months has been a little more restrained than 2020, 2021 and early 2022, and I believe that the ‘steady as she goes’ outlook will continue into the rest of 2024 and beyond.

As property ownership is a medium to long-term investment, it is important to see what has happened to Southampton house prices.

Since the start of the Millennium (Jan 2001), the average Southampton homeowner has seen their property’s value rise by an average of 173%.

This is important as house prices are a national obsession and tied into the health of the UK economy as a whole. Most of that gain has come from the overall growth in Southampton property values, while some of it will have been enhanced by extending, modernising or developing their Southampton home.

Taking a look at the different types of property in Southampton and the profit made by each type, it makes interesting reading:

• Overall Average For All Homes in Southampton. The average price of all homes in Southampton in 2001 was £98,084. Now it’s 2024, it has risen to £264,233. This is a total profit of £166,149 (which is £7,224 profit per year per home or an annual growth of 7.5% per year).
• Apartments in Southampton. The average price of an apartment in Southampton in 2001 was £73,007. Now it’s 2024, it has risen to £146,608. This is a total profit of £73,601 (which is £3,200 profit per year per home or an annual growth of 4.4% per year).
• Terraced/Town Houses in Southampton. The average price of a terraced/town house in Southampton in 2001 was £85,197. Now it’s 2024, it has risen to £258,663. This is a total profit of £173,466 (which is £7,542 profit per year per home or an annual growth of 8.9% per year).
• Semi-Detached Homes in Southampton. The average price of a semi-detached home in Southampton in 2001 was £103,331. Now it’s 2024, it has risen to £304,635. This is a total profit of £201,304 (which is £8,752 profit per year per home or an annual growth of 8.5% per year).
• Detached Homes in Southampton. The average price of a detached home in Southampton in 2001 was £180,444. Now it’s 2024, it has risen to £488,879. This is a total profit of £308,435 (which is £13,410 profit per year per home or an annual growth of 7.4% per year).

However, we can’t forget there has been 79% inflation over those 23 years, which eats into the ‘real’ value (or true spending power of that profit) … so if we take into account inflation since 2001, the true ‘spending power’ of that profit has been lower.

• Overall Average For All Homes in Southampton. The total ‘real profit’ (i.e., after inflation has been removed) for the average Southampton home is £92,459 for the last 23 years. This equates to £4,020 ‘real’ profit per annum.
• Southampton Apartments. The total ‘real profit’ (i.e., after inflation has been removed) for the average Southampton apartment is £40,958 for the last 23 years. This equates to £1,780 ‘real’ profit per annum.
• Southampton Terraced/Town Houses. The total ‘real profit’ (i.e., after inflation has been removed) for the average Southampton terraced/town house is £96,531 for the last 23 years. This equates to £4,197 ‘real’ profit per annum.
• Southampton Semi-Detached Homes. The total ‘real profit’ (i.e., after inflation has been removed) for the average Southampton semi-detached home is £112,022 for the last 23 years. This equates to £4,870 ‘real’ profit per annum.
• Southampton Detached Homes. The total ‘real profit’ (i.e., after inflation has been removed) for the average Southampton detached home is £171,639 for the last 23 years. This equates to £7,462 ‘real’ profit per annum.

Thus, the annual profit for an average Southampton home, adjusted for inflation, stands at £4,020.

I wanted to illustrate that despite the 2008/09 Credit Crunch property market crash, which saw Southampton property values plummet by 15% to 20% over 18 months, homeowners in Southampton have still fared better over the long term than those renting.

Looking ahead, a common question I get asked is about the future trajectory of the Southampton property market.

The primary influence on maintaining house price growth in Southampton over the medium to long term will be the construction of new homes locally and nationally. Although we have yet to get the figures for 2023, government sources indicate that the number of new households is expected to be between 210,000 and 220,000. Considering the annual need is for 300,000 new households to meet demands arising from factors such as immigration, increased life expectancy, higher divorce rates, and later cohabitation, it’s clear that demand will continue to outstrip supply unless the government heavily invests in building council houses.

This can only be good news for Southampton homeowners.

What about Southampton landlords, though?

Even though the number of landlords liquidating their property portfolios has increased in the last couple of years and the number of landlords buying is lower than in the 2000s and 2010s, there is still net growth in the size of the private rented sector each year. This is all despite facing higher taxes. The simple fact is many Southampton landlords remain keen on expanding their portfolios in the long term.

The younger generation in Southampton views renting as a choice that offers flexibility and alternatives that homeownership does not provide. This means that demand for rentals will keep growing, allowing landlords to enjoy rising rents and capital appreciation. However, Southampton buy-to-let landlords must adopt more thoughtful strategies to maintain profitable returns from their investments.

As a Southampton buy-to-let landlord, the question for you is how to ensure this growth continues.

Since the 1990s, generating profits from buy-to-let property investments was straightforward. Moving forward, with changes in the tax laws and the balance of power, achieving similar returns will be more effortful. Over the past decade, I’ve observed the evolution of agents from mere rent collectors to strategic portfolio managers. I, along with a select few agents in Southampton, am adept at providing comprehensive, strategic portfolio leadership. This service offers a structured overview of your investment goals across short, medium and long-term horizons, focusing on your expected returns, yields and capital growth. If you seek such advice, feel free to contact your current agent or me directly at no cost or obligation.

A Father’s Tale: Navigating The Twists And Turns Of Buying A Home

 There’s plenty to consider when moving home, especially when a growing family is involved.

Over the past few months, we’ve looked at the buying and selling experience through the eyes of different members of a family who moved recently.

We’ve spoken with teenagers, tweenagers (9 – 12), younger children (5 – 8) and mums.

In this article, it’s dad’s turn to share his thoughts, fears and advice on moving home with a family.

Here’s Dave’s experience.

From first glance to final offer

“At first sight, the property seemed almost too good to be true, ticking every box on our wish list. Yet, the initial excitement gave way to a lot of questions. Could we imagine our family’s life here? What renovations were needed, and could we realistically achieve and afford them? We decided to go for it as a family, and our offer was accepted.”

The mortgage maze unravelled

“With interest rates on a rollercoaster of their own, securing a mortgage quickly became our top priority. I spent a lot of time finding the right mortgage for us, and it was pretty stressful waiting to see if we’d be approved for one.”

The heartache and hope of selling our home

“Letting go of our home, where we’d made many memories and carried out a lot of improvements, was bittersweet. The emotional weight of moving on was a hurdle I hadn’t fully anticipated, especially as we listened to the kids’ concerns and thoughts. But ultimately, everyone was excited about it.”

When the best-laid plans go awry

“It was a challenge keeping our property chain together. My biggest fear was disappointing our children, who had set their hearts on the new home. Through constant communication and the support of our estate agent, we got the deal over the finish line.”

Final thoughts

“The best advice I can give any parent during a home move is to keep the kids informed, keep a sense of humour and perspective, control what you can and employ the right agent to handle your sale. Aim to be over-prepared rather than the opposite.”

If you’re thinking of moving, contact us today at 023 8001 8222.