Additional 983 Haywards Heath Rented Homes Required by 2027.

I have been doing some research, looking both at National and Regional reports on the demand and supply of property and people together with future projections on the economy, population and family demographics with some interesting results.  According to the Office of National Statistics, in the last financial year nationally, private renting grew by 74,000 households, whilst the owner occupied dwelling stock increased by 101,000 and social (aka council and housing association) stock increased by 12,000 dwellings.

It was the private rental figures that caught my eye.  With eight or nine years of recovery since the Credit Crunch, economic recovery and continuing low interest rates have done little to setback the mounting need for rented housing.  In fact, with house price inflation pushing upwards much quicker than wage growth, this has meant to make owning one’s home even more out of reach for many Millennials, all at a time when the number of council/social housing has shrunk by just over 2.5% since 2003, making more households move into private renting.

There are 5,022 people living in 2,293 privately rented

properties in Haywards Heath.

In the next nine years, looking at the future population growth statistics for the Haywards Heath area and making careful and moderate calculations of what proportion of those extra people due to live in Haywards Heath will rent as opposed to buy, in the next ten years, 2,152 people (adults and children combined) will require a private rented property to live in.

Therefore, the number of Private Rented homes in Haywards Heath will need to rise by 983 households over the next nine years,

That’s 109 additional Haywards Heath properties per year that will need to be bought by Haywards Heath landlords, for the next nine years to meet that demand; and remember, I am being conservative (with a small ‘c’) with those calculations, as demand for privately rented homes in Haywards Heath could still rise more abruptly than I have predicted as I would ask if Theresa May’s policies of building 400,000 affordable homes (which would syphon in this 5-year Parliamentary term) is rather optimistic, if not fanciful?

So, one has to ask wonder if it was wise to introduce a buy to let stamp duty surcharge of 3% and the constraint on mortgage tax relief could curtail and hold back the ability of private landlords to expand their portfolios?

Well a lot of landlords are taking on these new hurdles to buy to let and working smarter.  Buying the property at the right price and using an agent to negotiate on your behalf (we do this all the time) and the 3% stamp duty level isn’t an issue.  Incorporating your property portfolio into a Limited Company is also a way to circumnavigate the issues of mortgage tax relief (although there are other hurdles that need to be navigated on that tack), but just look at the growth of proportion of Buy to Let properties in the Country since the summer of 2016. Something tells me smart landlords are seeing these challenges as just that; challenges which can be overcome by working smarter.

I have a steady stream of Mid Sussex landlords every week asking me my opinion on the future of the Mid Sussex property market and their individual future strategy and, whether you are a landlord of mine or not, if you ever want to send me an email or pop into my office to chat on how you could navigate these new Buy to Let waters it will be good to speak to you (because you wouldn’t want other landlords to have an advantage over you – would you?)

Mid Sussex Property Market: Is Sell to Rent the new Buy to Let?

It doesn’t seem two minutes ago that it was 90 degrees Fahrenheit in the shade (32 degrees Celsius for my younger readers), hosepipe bans looked likely and it was simply too hot to sleep at night, yet early indications were, that as the temperatures soared, the Mid Sussex property market appeared to be doing the reverse and was already starting to cool down.

25.49% less people moved home in the Mid Sussex area in the first part of 2018, when compared to the average number of people moving home (in the same time frame) between 2014 and 2017

The average number of households who sold and moved locally between 2014 and 2017 in the winter and spring months was 219 homes a month, yet in the same time frame in 2018, only 163 (on average) sold and moved.

So, what is the issue? Many have cited Brexit as the issue – but I think it’s deeper than that.

Brexit seems to be the “go to excuse” for everything at the moment! Anyway a few weeks ago, I was out for a family get together in another part of the UK when one of my extended family said that they were planning on buying their first home this autumn most of those present said they were stupid to do so because of Brexit. Nonetheless, half an hour later, another distant cousin said to the same family crowd that they were planning to sell their home; to which most said they were also daft to do so because of Brexit.

Both sides of the argument can’t be right! So, what exactly is happening?

Well if you have been reading my blog on the Mid Sussex property market over the last few months, I have been discussing the threats and opportunities of the current state of fluidity in the Mid Sussex property market, including the issue of OAPs staying in homes that are too big for them as their children have flown the nest, interest rates, inflation, lack of new homes being built and the long term attitude to homeownership, yet I have noticed a new trend in the last few months; the emergence of the ‘sell to renter’.

Sell to Renter?

I have seen a subtle, yet noticeable number of Mid Sussex homeowners that have been selling their Mid Sussex homes, renting and wagering that, in the next few years, the Mid Sussex property market will tumble by more than what they spend on their short-term rental home, before they buy another Mid Sussex home in a couple of years i.e. a ‘sell to renter’. This type of ‘sell to renter’ is mostly predominant at the middle to upper end of the Mid Sussex property market – so I’m not too sure if it will catch on in the main ‘core’ market?

So, what does this all mean for Mid Sussex homeowners and Mid Sussex Buy to Let landlords?

Well, in the short term, demand for middle to upper market Mid Sussex rental properties could increase as these ‘sell to renters’ demand such properties. I would however give a note of caution to Mid Sussex landlords buying in this sector of the Mid Sussex property market as yields in this sector can be quite low. However, for homeowners of middle to upper market Mid Sussex properties, you might have less people wanting to buy your type of property, as some buyers are turning to renting.

Like I have always said, Mid Sussex properties are selling if they are realistically priced (realistic for the market – not a rose-tinted version where someone will pay 10% over the odds because everyone has access to the market stats with the likes of Rightmove and Zoopla!).

P.S Notice the spike in the graph, where the number of property sales jumped to 365 in the month of March 2016? That was all the Mid Sussex buy to let landlords snapping up buy to let properties before the stamp duty rules changed! 

2 bed or 3 bed homes – Which Sell the Best in Haywards Heath?

A few months ago, I wrote an article on the Haywards Heath Property Blog about the length of time it took to sell a property in Haywards Heath and the saleability of the different price bands (i.e. whether the lower/middle or upper local property markets were moving slower or quicker than the others). For reference, a few months ago it was taking on average 52 days from the property coming on the market for it to be sold subject to contract (and that was based on every Estate Agent in Haywards Heath) and today 91 days. Does that surprise you with what is happening in the UK economy?

Well, a number of Haywards Heath landlords and homeowners, who are looking to sell in the coming months, contacted me following that article to enquire what difference the type of property (i.e. Detached/Semi/Terraced/Apartment) made to saleability and also the saleability of property by the number of bedrooms. As I have said before, whether you are a Haywards Heath landlord looking to liquidate your buy to let investment or a homeowner looking to sell your home; finding a buyer and selling your property can take an annoyingly long time, but anything you can do to mitigate that is helpful to everyone.

So, I did some research on the whole of the Haywards Heath property market and these were my findings. To start with by type i.e.Detached/Semi/Terraced/Apartment).

As you can see, the star players are the apartments and semi-detached variants of Haywards Heath property, whilst detached properties seem to be sticking in Haywards Heath.

Next I looked at what the number of bedrooms does to the saleability of Haywards Heath property.

As you can see the four bed properties seem to be taking the longest time to sell; and to answer the question in the title, it’s two bed properties!

So, what does this mean for Haywards Heath buy-to-let landlords and homeowners?  

There is no doubt that there is a profusion of properties on the market in Haywards Heath compared to 18 months ago … it’s not because more houses are coming on to the market, it’s because they are also taking a little longer to sell. This makes it slightly more a buyer’s market than the seller’s market we had back in 2014/5/6. Therefore, in some sectors of the Haywards Heath property market, it is much tougher to sell, especially if you want to sell your Haywards Heath home fast.

Therefore, to conclude, on the run up to the New Year, if you are looking to buy and plan to stay in the buy to let market a long time, perhaps take a look at the Haywards Heath properties that are sticking as there could be some bargains to be had there? Want to know where they are; drop me a line and I will tell you a nifty little trick to find all the properties that are sticking.