What's in store next year for the Burton property market?

A number of landlords, who own property in Burton, have made contact with me recently asking for my thoughts on the future of the buy to let market in Burton. In previous articles, we have talked about Burton’s history of rents, property values, tenant demand and yields; all important matters for a landlord, but we haven’t discussed the future.

Property values rose by 4.2% (Oct 13 to Oct 14) in Burton. Good news all round, but when you consider property values in the town have previously dropped by 14.91% between November 2007 and June  2013, this is not as good as the media would have you believe.  It should be no great surprise to hear that Burton property values are starting slow up as we head in to the New Year.  Property values in the town were growing at 0.7% a month in the summer this year, but in October they dropped by 0.1%.

The reality is we have had a year and a half of decent market conditions in Burton, but now all that pent up demand is starting to fade. The big question moving forward is whether the Burton market will now be held back by affordability and restricted mortgage lending, and what long term impact this will have on the Burton property market.

Looking at the UK as a whole, because we can’t look at Burton in just its little own bubble, the recent rapid rise in house values in some parts of the UK in the early part of the year (especially in London), along with earnings growth that remain below inflation and the possibility of an interest rate rise over the coming months, appear to have tempered housing demand. This weakening in demand has led to a modest easing in both property price growth and sales. A moderation in growth looks likely into next year as supply and demand become increasingly better balanced.

Now with the General Election on the horizon, whichever Government takes power, they, along with the Bank of England, have a thorny job to do in balancing the expected rise in interest rates with the continued resurgence of the housing market, to ensure the property market doesn’t drop and drag down the economic recovery forcing people into selling their property at a loss.

However, back to Burton, long term property values which track peaks and troughs are more helpful to landlord investors. The questions I seem to be asked on an almost daily basis by landlords are:-

“Should I sell my property in Burton, or even buy another?”

“Is the time right to buy another buy to let in Burton and if not Burton, where?” 

“Are there any property bargains out there in Burton?” 

Many other Burton landlords, both who are with us and many who are with other  Burton letting agents, like to pop in for a coffee to  discuss the Burton property market, how Burton compares with its closest rivals (Nottingham, Lichfield, Derby, Loughborough and Swadlincote), and hopefully answer the three questions above. I don’t bite, I don’t do hard sell, I will just give you my honest and straight talking opinion.

In the meantime may I take this opportunity to wish you all a very Merry Christmas and a prosperous 2015.

Put the party poppers away. The Burton property market is kaput…

OK, I know it’s party season and all that but, as far as the local property market is concerned, you can put the streamers and silly hats away, the party that is ‘The Burton Property Boom’ is over! The balloon has burst. It is kaput.

During the last 3 months, property values have only risen by 0.1%. So surely this is doom and gloom time isn’t it?

Well, no actually because the Burton housing marketing is entering a new phase. It has been through the 2001 to 2007 boom, a bust in 2008 and 2009 and a recovery cycle since 2012, and as we head into 2015, a year that will see the formation of a new Government, we are now entering a more stable, yet still challenging era.

As I said to a landlord from Repton, who has recently changed agents to us, in the Midlands, (especially the big towns and cities like Nottingham, Derby, Loughborough and our own Burton) we are all facing a housing crisis, because in the Midlands – with its high employment rates, excellent quality of life, and rapidly growing strengths in a range of sectors, it is becoming a victim of its own success.

People want to live here but nobody wants to build on greenbelt. With planners not willing to give planning permissions for thousands of new properties that are required for our ever growing Burton population, accommodation in the town is in ever greater demand whilst supply remains worryingly slow to come through.

Just because property prices have levelled off in Burton, doesn’t mean the housing market is ready to jump off a cliff. I actually see this as a good thing, in fact, for the savvy landlord, a blessing in disguise. If you think the housing market is done and dusted for 2014, think again. This is the perfect time to snap up a bargain.

Despite recent mild weather, chill winds are hitting parts of the market now. This means every seller has three strong reasons to get their business done this side of Christmas. You see, as a landlord with cash in your pocket, ready to buy the next buy to let investment, you can get a bit of a bargain at the moment. We have seen it in Burton as a seller’s market for 12 months, but as the pressure mounts for property sellers to sell, the market has tipped.

Another reason sellers want to do a deal as soon as possible is the uncertainty surrounding the general election in the coming Spring. In the past, the prospect of an election means buyers hold back until they know how their income and tax might be affected. But for the brave landlord, it’s a chance to look at properties with fewer rival landlord purchasers waiting in the wings.

As we approach the end of 2014 - which, personally, has been a great year for me and for Professional Properties - I would like to say thank you to all the landlords and tenants who have popped into the office or have rang and emailed me their queries and questions regarding the residential rental market. I hope I have given you some valuable information to help make more informed decisions.

I don’t bite, I don’t do hard sell, I will just give you my honest and straight talking opinion. Email me if you want a chat and i can call you back or call me on 07973 666229!

In the meantime may I take this opportunity to wish you all a very Merry Christmas and a  prosperous 2015.