There I was, out with
the family at Golders Hill Park last weekend, when a smart gentleman approached
me. ‘Hello’, he said, ‘You are the person writes that Property Blog aren’t you?
We have met before at that Business Networking event in Hampstead a few months
ago’. I did then recognise him and, whilst I won’t mention his name, he runs a
small but perfectly formed well known independent retailers in the area ... It’s
amazing who you see when out walking! Anyway, I was at a loose end for five or ten
minutes as the other half was sorting things with the family, so we had a chat.
He wanted to know my
thoughts on the future of the Hampstead property market, and I would now like
to share with you that conversation. People are always
going to need a roof over their heads and somewhere to live will never go out
of fashion – it’s a necessity for every single person. The 22 to 30 year olds
of the suburb have a choice to what type of roof they have ... they rent from
the Council, they can rent from a private landlord or finally they can get a
mortgage and buy one. In the 1970’s/80’s and 90’s, the expected thing was to
save like mad for two years for the deposit (going without luxuries) whilst
living at home or renting a cheap two up two down, then buy your first house.
However, more recently fewer Hampstead youngsters have been buying, choosing to
rent instead – mainly from private landlords (as Councils have been selling off
council housing on the Right to Buy Schemes). The numbers are truly staggering
... and I want to share them with you.
Roll the clock back 20 years and Hampstead was
a different place. There were 89,533 households in the Camden area and 27,052
of those were owner occupied. Move to the present, and with all the building in
the Borough, the total number of households has increased by 8.98% to 97,576
and quite surprising (to me at least), the number of owner-occupiers has
increased to 31,343 (although as a proportion, it is only 32.1% compared to 30.2%
twenty years ago).
However, it’s the rented sector that is truly
fascinating … twenty years ago; only 17,148 properties were privately rented in
Camden ... and now its 31,419, a rise of 14,271.(Source - Office of National Statistics- ONS)
The twentysomethings
of Hampstead housing difficulties haven’t been helped by the local authority
selling off council housing, with the number of council houses dropping from 27,218
to 22,517 over the same twenty-year period. Demand for decent rented property
remains high, as the Conservative Party’s much vaunted house building program
is years away and has decades of under investment to catch up on before it
starts to affect demand. Even with the Buy to Let tax rule changes being phased
in as early as next month (which will see the maximum tax relief available to
landlords drop from 45% to 20%), private landlords still have an important role
to play in housing the people of Hampstead and those who educate themselves and
treat it as a business will survive and prosper.
The best way Hampstead landlords can protect
their income from property (and mitigate the affects of the tax rises) is to
keep the homes they let out in Grade A condition. I have found, especially over
the last three or four years, Hampstead tenants have ever growing demands from
their rental property, but many are prepared to pay ‘top dollar‘ for houses and
apartments that meet their high expectations. You must not forget, letting
property in Hampstead (in fact anywhere) is a business, so all private
landlords should also seek the advice, opinion and commentary of property
professionals.
... And just as the
other half had sorted the family, he asked ‘What of the news of Stamp Duty
changes that were introduced last year for Landlords?’ My thoughts are with
falling supply (i.e. numbers of property for sale) and
relatively high demand, the proportion of owner occupiers should increase
slightly compared to buy-to- let landlords in the coming decade as the the
housing market should return to balance.
If you are looking for an agent with experience that can help you find the right tenant for your property, then contact us to find out how we can get the best out of your investment property. Email me on chris@ashmoreresidential.com or give me a call on 020 7435 0420. Pop in for a chat – we are based on Ashmore Residential, Suite 7, 25-27 Heath Street, London, NW3 6TR. The kettle is always on.
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