As the trees turn from green to hues of red and brown, the Crawley
property market has a confident feel to it. With the underlying fundamentals of
a continued lack of properties being built, a
shortage of properties (both in terms of quantity and quality) coming to the
market and the continued low mortgage rate environment, buyer enquiries
from first time buyers and buy to landlords is strong and motivation is even stronger,
given those inexpensive lending rates and general demand caused by under
supply.
Now of course, there are a few potential hurdles coming towards us in
the coming months that could affect the Crawley (and UK) property market. Mrs.
May has yet to get her teeth into Brexit negotiations and we don’t know what
the US Presidential elections might do to the money markets around the world,
meaning that on the run up to Christmas, some savvy buyers may take advantage
of the lack of certainty by making cheeky offers, but I don’t believe these
will have a huge impact on property values (like the 2008 Credit Crunch).
You
see, property
ownership, whether it’s for yourself as a homeowner or buy to let landlord, is
a long term investment. In fact, focusing on buy to let, a number of landlords
who own property in Crawley have made contact with me recently asking for my
thoughts on the future of the buy to let market in Crawley. Well, as the Politician Edmund Burke said in the 18th century, "Those
who don't know history are destined to repeat it." .. in other words, to
see the future you must look into the past.
Since the Millennium, the housing market has
had everything thrown at it. The recent Brexit, last year’s General Election,
the near melt down of the World Economy with the Credit Crunch, The Dot Com
boom and bust, the housing market crisis in 2008, the housing boom of 2001 to
2004 .. the list goes on. In fact here is a graph (courtesy of the Land Registry)
of average Property values since the Millennium in the Crawley Borough Council
area.
Even though
we had the Dot Com bubble burst in 2000, two years later in January 2002, property
values in the Crawley Borough Council area have risen from £89,600 (in Jan 2000) to £114,800
.. and kept rising to November 2007, when they peaked at £202,600. Then we had
the Credit Crunch and property prices continued to fall until April 2009, where
they averaged £156,900 .. but look where they are now… £275,000
The point
I am trying to get across is long term future property values are more helpful
to landlord investors than the month by month headline grabbing micro movements
in the property market. Look at the graph and you
will see the growth in property values is an upward trend BUT, the average
darts about as each month goes by. So don’t
watch the property indexes and panic if values drop next month or the month
afterwards, because even in the glory days of 2001 to 2004 and 2012 to 2014,
without fail, values always dropped slightly around Christmas, but people will
always need a roof over their heads, and if they can’t buy and the council
aren’t building anymore .. only buy to
let landlords can meet that demand.
Crawley landlords are being hit in the pocket with the new up and
coming taxation rules and yes we might have a bumpy ride on the run up to
Christmas (because of the points raised earlier), Brexit or no Brexit, but the
trend will be a slow and steady upward momentum of property values, demand for
rental properties and yields in the Crawley property market into 2017 and
beyond.
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