The Land Registry recently released their latest figures on prices and activity in the Hillingdon property market. It makes interesting reading, as average property values in the borough rose by 0.4% in September. Which is good news for local property investors. This makes the average property value 13.1% higher than 12 months ago, meaning the annual rate of growth in the area has held steady in the borough at between 13% to 14%. Looking at the wider picture in London the rise was 1.8% last month with a rise of 9.6% vs last year. In England the rise was 1% on the month and 5% vs last year.
Volume of Hillingdon House Sales By Year
In the first seven months of the year (which is the latest data from Land Registry I can get my hands on) the volume of sales of property in Hillingdon was 1,886. I had been worried that volumes were falling but looking back over recent years these numbers look healthy. You can seek from the table the peak volumes for sales were 1999, and then 2006 and 2007 pre the global slow down in 2008, with volumes half the pre-crash levels in 2009. But volumes nowadays are only 70% of the level they were before the crash.
What Now for New BTL Investors?
So what does all this mean for Uxbridge landlords or those considering investing in buy to let (BTL) market for the first time? For many people, buy to let looks a good investment, providing landlords with a decent income at a time of low interest rates and stock market unpredictability.
However, if you are thinking of investing in bricks and mortar in the Uxbridge area, it is important to do things correctly. As an investment to provide you with income, for those with enough savings to raise a big deposit, buy to let looks particularly good, especially compared to low savings rates and stock market movements. I must also remind readers, landlords have two opportunities to make money from property, not only is there the rent (income), but with the property market bouncing back over the last few years, property value increases has spurred investors to buy property in the hope of its value continuing to rise. In the short term this is speculative, but looks reasonable for the longer term and I would only ever consider property a long term investment.
A Post Halloween Scary Tale of Mortgage Rises
At the present time landlords with a large deposit (typically 40%) can fix mortgage rates at just over 3% for five years, making many deals attractive. Speak to a regulated Mortgage advisor on this. Despite Mark Canrey’s pushing interest rate rises into the long grass, nevertheless, low rates cannot stay low forever. One day they must rise and you need to know your property investment can stand that test. I saw some Uxbridge landlords struggling in the mid 00’s, when interest rates moved from 3.5% in July 2003 to 5.75% in July 2007. Okay so that’s not a lot really, but it might mean the difference between making £100 a month in 2003 to compared to having to make up a shortfall of £100 a month in 2007.
It’s true landlords were given a boost when the BoE base rate fell to 0.5% in March 2009. Whilst interest rates have remained there since, they will rise again in the future. Long term averages have inescapable gravity. However, even with the potential for costs to rise, demand for decent rental properties remains high as there are ever more tenants in the market, driving up demand and thus rents. The British love of bricks and mortar plus improving mortgage deals also add up to fuel the buoyant Uxbridge and Hillingdon property market.
If you are planning on investing in the Uxbridge property market, or just want to know more, things to consider for a successful buy to let investment, one source of information is here at the Uxbridge Property Blog.
