A few days over the Easter break is always a good time to reflect and think. I have been considering the Uxbridge property market and the rising prices we have seen and some of the legislative changes. Sometimes it’s hard to tell the difference between what we hope for and what is a certainty. For example we as landlords, hope for continued property price rises but that is far from a certainty.
The changes in taxation and tightening up of lending in the buy to let sector are well known and some are predicting the end of buy to let as we know it…
Are Landlords Facing the End of Buy To Let – FT.com
Buy-to-let landlords should face new affordability tests, Bank says
However it is definitely still possible to make a reasonable and fair return from buy to let in the Hillingdon and Uxbridge area. Many of these changes affect landlords with mortgages and I understand around two thirds of buy to let property are mortgage free.
There are some certainties. People will always want somewhere to live and it does not look like we are building enough property to house the numbers needed. The strongest evidence for this is the rising property prices.
End of Spring Flower on Hillingdon Hill
Type of Hillingdon Housing Tenure
I would not be afraid of change. In fact it’s the only certainty. In fact if we go back to 1991 when 73% of the households were privately owned only 7% of housing was in the private rental sector. The balance was let from Housing Associations and the local authority. In 2001 the home ownership was still at 72%, but had dropped to 64% in 2011. In 2001 the private rental market had grown to 11% of housing and then to 18% by 2011. A massive change in home ownership, with the private rental sector moving from 8,085 households to 18,141 between 1991 and 2011.
The Rise of Hillingdon Property Prices
If you had asked in 1995 what will happen to property prices over the next twenty years would they have said they would increase by 276% in that time? Between 1975 and 1995 prices increased in the area by around 425%. Although inflation might well account for more of the old growth than it does today.
The property market continues to change. Population will grow, we are inherently resisting building more property so prices over the long term are likely to rise.
I see the changes in tax and landlord and tenant law as bringing many opportunities. You will need to be a better landlord going forward, provide better property and to be frank that is not a bad thing for tenants and the industry.
But invest for the long term and buy to let remains a strong long term attractive option. If some investors panic and the market falls the opportunities for sensible long term landlords will increase.
If you want to discuss the Uxbridge, Hayes, West Drayton property markets please feel free to call me.
Last Bud of Spring on Hillingdon Hill
