Great yield. Great location!

Good Morning to my blog reading fans, I was checking what has come to the market, as I do over a coffee every morning, and this little rental gem popped up. On the market with Moore & Partners in Crawley this lovely one bed flat in Handcross is well priced at £160,000. You can view the details by clicking here.

It is very well presented and looking at the photos could be rented without doing any work. It is perfect for commuting due to its proximity to the main A23 and would be attractive to Gatwick workers. Rental wise I would be looking at around £750 PCM, which at the guide price of £160,000 gives an impressive yield of 5.6%. The property is leasehold, so make sure you check out the service charges and ground rent carefully, as this will have an effect on any yield.

If you are considering a buy to let investment you are welcome to call in to my Martin & Co office on Keymer Road for a coffee and a chat, or email me if you have any questions.

Population in Mid Sussex area set to rise to 170,700 by 2036.

Mid Sussex faces a predicament. The population is growing and the provision of new housing isn’t keeping up. Take Burgess Hill for example, with the average age of a Burgess Hill person being 41.0 years (compared to the South East average of 40.0 years old and the national average of 39.4 years of age). The population of Burgess Hill is growing at an alarming rate. This is due to an amalgamation of longer life expectancy, a fairly high birth rate (compared to previous decades) and high net immigration, all of which contribute to housing shortages and burgeoning house prices.

Durham University has kindly produced some statistics specifically for the Mid Sussex District Council area. Known as the UK’s leading authority for such statistics, their population projections make some startling reading.

For the Mid Sussex District Council area these are the statistics and future forecasts

2016 population           146,799

2021 population           153,426

2026 population           159,833

2031 population           165,480

2036 population           170,709

The normal ratio of people to property is 2 to 1 in the UK, which therefore means we need just under 12,000 additional new properties to be built in the Mid Sussex District Council area over the next 20 years.

Whilst focusing on population growth does not tackle the housing crisis in the short term in Burgess Hill, it has a fundamental role to play in long-term housing development and strategy in the town. The rise of Burgess Hill property values over the last six years since the credit crunch are primarily a result of a lack of properties coming onto the market, a lack of new properties being built in the town and rising demand (especially from landlords looking to buy property to rent them out to the growing number of people wanting to live in Burgess Hill but can’t buy or rent from the Council).

Although many are talking about the need to improve supply (i.e. the building of new properties), the issue of accumulative demand from population growth is often overlooked. Nationally, the proportion of 25-34 year olds who own their own home has dropped dramatically from 66.7% in 1987 to 43.8% in 2014, whilst 78.2% of over 65s own their own home. Longer life expectancies mean houses remain in the same hands for longer.

The swift population growth over the last thirty years provides more competition for the young than for mature population.  It might surprise some people that 98% of all the land in the UK is either industrial, commercial or agricultural, with only two percent being used for housing, which means one could propose expanding supply to meet a expanding population by building on green belt – that most Politicians haven’t got the stomach to tackle, especially in the Tory’ strongholds of the South of England, where the demand is the greatest. People mention brownfield sites, but recent research suggests there aren’t as many sites to build on, especially in Burgess Hill that could accommodate 12,000 properties in the next 20 years.

In the short to medium term, demand for a roof over of one’s head will continue to grow in Burgess Hill (and the country as a whole). In the short term, that demand can only be met from the private rental sector (which is good news for homeowners and landlords alike as that keeps house prices higher).

In the long term though, local and national Government and the UK population as a whole, need to realise these additional millions of people over the next 20 years need to live somewhere. Only once this issue starts to get addressed, in terms of extra properties being built in a sustainable and environmentally friendly way, can we all help create a socially ecological prosperous future for everyone.

59 days to find a buyer for your Burgess Hill Property

I had a landlord from Worlds End email me the other day. She said she had been following my blog (the Mid Sussex Property Market Blog) for a while and wanted to pick my brain on when is the best time of the year to sell a property. Trying to calculate the best time to put your property on the market can often seem something akin to witchcraft and, whilst I would agree that there are particular times of the year that can prove more productive than others, there are plenty of factors that need to be taken into consideration.

Even if you are putting your property on the market, you don’t know how long it will take to find a buyer - no crystal ball to help with that one. At the moment, the latest set of figures for all 11 estate agents in Burgess Hill, show the average length of time it takes to find a buyer for any Burgess Hill property is as follows:

Detached                63 days

Semi                      47 days

Terraced                 32 days

Flat                        92 days

Overall average        59 days

If we roll the clock back to January 2016, the overall average time it took to find a buyer (again using data from all of the 11 Burgess Hill Estate Agents) was 72 days.

So, on the face of it, things have improved over the last six months or so. Well, when I looked at the data going back to 2009, and every Spring since then, the average length of time it takes to sell a property drops between January and the Summer months, for it to rise on the run up to Christmas. For example;

Winter 2009 - 156 days       Summer 2009 - 151 days

And in more recent times;

Winter 2013 - 101 days       Summer 2013 - 108 days

Winter 2014 – 93 days         Summer 2014 - 86 days

Winter 2015 -   69 days       Summer 2015 - 79 days

         

Coming back to the present, even if you placed your property on the market today in Burgess Hill, if it takes you on average a little over eight weeks to find a buyer, then you can expect solicitors and the chain to take an additional eight and twelve weeks after that, before you move. It comes down to personal choice as to when you place your property on the market. Children often affect the decision. On one side you might delay putting that for sale board in your front garden so you can move in the summer school holidays, but on the other side, you might want to move sooner to be in the catchment area of a preferred school, in plenty of time for the next academic year.

There are times of the year when it's better to sell, and times when waiting a little longer can pay off in the long run. In a nutshell, I would say this is the way of the seasons;

WHEN THE MARKET?

Spring: Customarily there are more house-buyers as the Daffodils show themselves

Summer: Sellers may miss out on house-buyers being on holiday

Autumn: The enthusiasm for buying homes returns

Winter: Interest diminishes as festive period looms.

What this means to buyers and landlord investors is that they often pick up a bargain in later months of the year, as there is less competition from owner occupiers. So, whilst there are better months to achieve a quicker sale, the only piece of advice I can give to every home  owner and landlord in Burgess Hill, is do the right thing for yourself, do your homework and buy (and sell) with both your head as well as your heart.

Asking prices of Burgess Hill property up 11% in the last year

I had an interesting question the other day from a homeowner in Burgess Hill who asked me the difference between asking prices and values and why it mattered. When it comes to selling property, there must be agreement between the purchaser (buyer) and seller (vendor) for a property sale to take place. The value a buyer applies to a property can massively differ from the value a seller or Mortgage Company places upon it. The seller, the buyer and the mortgage company must find an agreeable value to assign to a property so the sale can proceed. 

In many of my articles about the Burgess Hill property market, I talk about values, i.e. what property in Burgess Hill actually sells for, but I haven’t spoken about asking prices for while. Now asking prices are important as they are one of the four key matters a potential buyer will judge your property on (the others being location, bedrooms and type). Price yourself too high and you will put off buyers. So let’s take a look at the Burgess Hill numbers.

Over the last 12 months asking prices (i.e. the price advertised in the paper and on Rightmove) in Burgess Hill have increased by 11%, taking the average asking price in Burgess Hill to £441,000 (up from £396,500 twelve months ago).

Interestingly though, when we look at, say detached and terraced property, a slightly different picture appears. Twelve months ago, the average asking price for a detached house in Burgess Hill was £586,900 and today its £610,100 (a rise of 4%); whilst over the same 12-month period, the average asking price of a terraced property was £253,000 a year ago, and today its £285,800 (a rise of 13%). 

However, my research shows that the supply of property for sale in Burgess Hill is beginning to increase. In December 2015, there were 86 on the market in Burgess Hill today there are 147 properties on the market (up 71%). This will mean homeowners looking to sell will need to be conscious of how their property compares against others on the Burgess Hill property market. The Burgess Hill property market still has substantial momentum and sufficient demand remains to provoke more modest asking price rises. This noteworthy increase in supply since Christmas is currently providing more choice for buyers and is tempering asking price rises.

And here is the second point to make. Asking prices are one thing, but what a property sells for (i.e. value) is a completely different matter. These are the average prices achieved (i.e. what they sold for or the average value) for property in Burgess Hill over the last 12 months;

•        Overall Average        £309,000

•        Detached                 £433,400

•        Terraced                  £259,200

You can quite clearly see there is a difference between what people are asking for property and what it is selling for. The underlying fundamentals of low interest mortgages and tight supply remain prevalent in the Burgess Hill property market however, the number one lesson has to be this, if you want to sell, be realistic with your pricing.