£13.08bn – The total value of all Maidstone Property Market

“How much would it cost to buy all the properties in Maidstone?”

This fascinating question was posed by the 11-year-old son of one of my Maidstone landlords when they both popped into my offices before the Christmas break (doesn’t that seem an age away now!). I thought to myself, that over the Christmas break, I would sit down and calculate what the total value of all the properties in Maidstone are worth … and just for fun, work out how much they have gone up in value since his son was born back in the autumn of 2005.

In the last 11 years, since the autumn of 2005, the total value of Maidstone property has increased by 47% or £4.18 billion to a total of £13.08 billion. Interesting, when you consider the FTSE100 has only risen by 30.78% and inflation (i.e. the UK Retail Price Index) rose by 37% during the same 11 years.

When I delved deeper into the numbers, the average price currently being paid by Maidstone households stands at £285,727.… but you know me, I wasn’t going to stop there, so I split the property market down into individual property types in Maidstone; the average numbers come out like this ..

Maidstone Property Market
Average Value of a Detached Property	Average Value of a Semi-Detached Property	Average Value of a Terraced/Town House Property	Average Value of an Apartment
£483,115	£309,453	£246,513	£158,976

... yet it got even more fascinating when I multiplied the total number of each type of property by the average value. Even though detached houses are so expensive, when you compare them with the much cheaper semi-detached houses, you can see detached properties are not a match in terms of total pound note value of the semi-detached houses.

Total Value of all the Maidstone Detached Properties	Total Value of all the Maidstone Semi-Detached Properties	Total Value of all the Maidstone Terraced/Town House Properties	Total Value of all the Maidstone Apartments
£4,211,313,455	£4,605,898,452	£2,910,085,965	£1,357,655,040

So, what does this all mean for Maidstone?  Well as we enter the unchartered waters of 2017 and beyond, even though property values are already declining in certain parts of the previously over cooked Central London property market, the outlook in Maidstone remains relatively good as over the last five years, the local property market was a lot more sensible than central London’s.

Maidstone house values will remain resilient for several reasons. Firstly, demand for rental property remains strong with continued immigration and population growth.  Secondly, with 0.25 per cent interest rates, borrowing has never been so cheap and finally the simple lack of new house building in Maidstone not keeping up with current demand, let alone eating into years and years of under investment – means only one thing – yes it might be a bumpy ride over the next 12 to 24 months but, in the medium term, property ownership and property investment in Maidstone has always, and will always, ride out the storm.

In the coming weeks, I will look in greater detail at my thoughts for the 2017 Maidstone Property Market. As always, all my articles can be found at the Maidstone Property Market Blog.If you are looking for an agent that is well established, professional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on claire.harvey@seekersmaidstone.co.uk or call on 01622 671878. If you are in the area, feel free to pop into the office – we are based on 53 High Street, Maidstone, ME14 1SY. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Maidstone Property News.

LinkedIn, www.linkedin.com/in/claireharveyestateagent
Blog, http://maidstonepropertyblog.blogspot.com/
Facebook, https://www.facebook.com/SeekersHomesUK
Twitter, https://twitter.com/seekershomes
Website, http://www.seekershomes.co.uk/

 

£54m a year black hole in the Maidstone Property Market - Is Buy to Let Immoral? (Part 2)

An Englishman’s Home is His Castle as Maggie Thatcher lauded - everyone should own their own home. In 1971, around 50% of people owned their own home and, as the baby-boomers got better jobs and pay, that proportion of homeowners rose to 69% by 2001. Homeownership was here to stay as many baby boomers assumed it’s very much a cultural thing here in Britain to own your own home.

But on the back of TV programmes like Homes Under the Hammer, these same baby boomers started to jump on the band wagon of Maidstone buy to let properties as an investment. Maidstone first time buyers were in competition with Maidstone landlords to buy these smaller starter homes … pushing house prices up in the 2000’s (as mentioned in Part One) beyond the reach of first time buyers. Alas, it is not as simple as that. Many factors come into play, such as economics, the banks and government policy. But are Maidstone landlords fanning the flames of the Maidstone housing crisis bonfire?

I believe that the landlords of the 7,008 Maidstone rental properties are not exploitive and are in fact, making many positive contributions to Maidstone and the people of Maidstone. Like I have said before, Maidstone (and the rest of the UK) isn’t building enough properties to keep up the demand; with high birth rate, job mobility, growing population and longer life expectancy.

According to the Barker Review, for the UK to standstill and meet current demand, the country needs to be building 8.7 new households each and every year for every 1,000 households already built. Nationally, we are currently running at 5.07 per thousand and in the early part of this decade were running at 4.1 to 4.3 per thousand.

 

It doesn’t sound a lot of difference, so let us look at what this means for Maidstone …

For Maidstone to meet its obligation on the building of new homes, Maidstone would need to build 384 households each year. Yet, we are missing that figure by around 160 households a year.

For the Government to buy the land and build those additional 160 households, it would need to spend £54,135,136 a year in Maidstone alone. Add up all the additional households required over the whole of the UK and the Government would need to spend £23.31bn each year … the Country hasn’t got that sort of money!

With these problems, it is the property developers who are buying the old run-down houses and office blocks which are deemed uninhabitable by the local authority, and turning them into new attractive homes to either be rented privately to Maidstone families or Maidstone people who need council housing because the local authority hasn’t got enough properties to go around.

The bottom line is that, as the population grows, there aren’t enough properties being built for everyone to have a roof over their head. Rogue landlords need to be put out of business, whilst tenants should expect a more regulated rental market, with greater security for tenants, where they can rely on good landlords providing them high standards from their safe and modernised home. As in Europe, where most people rent rather than buy, it doesn’t matter who owns the house – all people want is a clean, decent roof over their head at a reasonable rent.

So only you, the reader, can decide if buy to let is immoral, but first let me ask this question - if the private buy to let landlords had not taken up the slack and provided a roof over these people’s heads over the last decade .. where would these tenants be living now? ….. because the alternative doesn’t even bear thinking about!

If you are looking for an agent that is well established, professional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on claire.harvey@seekersmaidstone.co.uk or call on 01622 671878. If you are in the area, feel free to pop into the office – we are based on 53 High Street, Maidstone, ME14 1SY. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Maidstone Property News.

LinkedIn, www.linkedin.com/in/claireharveyestateagent
Blog, http://maidstonepropertyblog.blogspot.com/
Facebook, https://www.facebook.com/SeekersHomesUK
Twitter, https://twitter.com/seekershomes
Website, http://www.seekershomes.co.uk/

Maidstone’s private renting set to hit 9,881 households by 2021 - Is Buy to Let immoral? (Part 1)

Can we blame the 55 to 70-year-old Maidstone citizens for the current housing crisis in the town?

Also known as the ‘Baby Boomer Generation’, these Maidstone people were born after the end of the Second World War as the country saw a massive rise in births as they slowly recovered from the economic hardships experienced during wartime.

Throughout the 1970’s and 1980’s, they experienced (whilst in their 20’s, 30’s and 40’s) an unparalleled level of economic growth and prosperity throughout their working lifetime on the back of improved education, government subsidies, escalating property prices and technological developments, they have emerged as a successful and prosperous generation.

...Yet some have suggested these Maidstone baby boomers have (and are) making too much money to the detriment of their children, creating a ‘generational economic imbalance’, where mature people benefit from house-price growth while their children are forced either to pay massive rents or pay large mortgages.

Between 2001 and today, average earnings rose by 65%,

but average Maidstone house prices rose by 133%

The issue of housing is particularly acute with the generation called the Millennials, who are young people born between the mid 1980’s and the late 1990’s. These 18 to 30 years, moulded by the computer and internet revolution, are finding as they enter early adult life, very hard to buy a property, as these ‘greedy’ landlords are buying up all the property to rent out back to them at exorbitant rents ... it’s no wonder these Millennials are lashing out at buy to let landlords, as they are seen as the greedy, immoral, wicked people who are cashing in on a social despair.

Like all things in life, we must look to the past, to appreciate where we are now.

The three biggest influencing factors on the Maidstone (and UK) property market in the later half of the 20^th Century were, firstly, the mass building of Council Housing in the 1950’s and 60’s. Secondly, for the Tory’s to sell most of those Council Houses off in the 1980’s and finally 15% interest rates in the early 1990’s which resulted in many houses being repossessed. It was these major factors that underpinned the housing crisis we have today in Maidstone.

To start with, in 1995 the USA relaxed its lending rules by rewriting the Community Reinvestment Act. This Act saw a relaxation on the Bank’s lending criteria’s as there was pressure on these banks to lend on mortgages in low wage neighbourhoods, as the viewpoint in the USA was that anyone (even someone on the minimum wage) any working class person should be able to buy a home.  Unsurprisingly, the UK followed suit in the early 2000’s, as Banks and Building Society’s relaxed their lending criteria and brought to the market 100% mortgages, even Northern Rock started lending every man and his dog 125% mortgages.

So when we roll the clock forward to today, and we can observe those very same footloose banks from the early/mid 2000’s (that lent 125% with a just note from your Mum and a couple of breakfast cereal tokens), ironically reciting the Bank of England backed hymn-sheet of responsible-lending. On every first time buyer mortgage application, they are now looking at every line on the 20-something’s banks statements, asking if they are spending too much on socialising and holidays ... no wonder these Millennials are afraid to ask for a mortgage (as more often than not after all that – the answer is negative).

Conversely, you have unregulated Buy To Let mortgages. As long as you have a 25% deposit, have a pulse, pass a few very basic yardsticks and have a reasonable job, the banks will literally throw money at you ... I mean Virgin Money are offering 2.99% fixed for 3 years – so cheap!

So, in Part Two next week, I will continue this emotive article and show you some very interesting findings on why young people aren’t buying property anymore (and it’s not what you think!).

If you are looking for an agent that is well established, professional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on claire.harvey@seekersmaidstone.co.uk or call on 01622 671878. If you are in the area, feel free to pop into the office – we are based on 53 High Street, Maidstone, ME14 1SY. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Maidstone Property News.

LinkedIn, www.linkedin.com/in/claireharveyestateagent
Blog, http://maidstonepropertyblog.blogspot.com/
Facebook, https://www.facebook.com/SeekersHomesUK
Twitter, https://twitter.com/seekershomes
Website, http://www.seekershomes.co.uk/

Fair Wear and Tear - An Overview

Many landlords ask what is fair wear and tear so I thought I would share this with you. It is an article prepared by Chase Inventory Services Limited.

The Legal definition- The law defines fair wear and tear as ” reasonable use of the premises by the tenant and the ordinary operation of natural forces”. This refers to the twin forces of time and normal daily habits. Walking across a carpet from the door to the dining table, for example, will exert a wearing effect during the length of a year which is perfectly natural.

A landlord cannot ask the tenant to pay for repairs or replacement at the end of the tenancy for changes caused by fair wear and tear.

No Entitlement to betterment:

It is a legal tenant that a landlord cannot expect to have old replaced with new at a tenant’s expense. An allowance for fair wear and tear must be made when considering compensation for damage.

Accessing fair wear and tear

A professional inventory clerk uses experience and common sense to assess the many factors present before deciding what is attributable to fair wear and tear. Here are some of the things a clerk will consider:

* The quality of the supplied item ( and that varies greatly).

* The age of the item.

*The condition at the start of the tenancy.

*The condition at the end of the tenancy.

* The usual life expectancy of the item.

*The number of tenants- and how many are adults and children-when appropriate.

* The length of the tenancy

* Any extenuating circumstances.

A tenant has a duty of care to leave the property at the end of the tenancy in the same condition recorded on the inventory, with fear wear and tear taken into account.

To avoid the appearance of betterment, the allocation of costs or compensation must take into account these three items.

1. Fear Wear and Tear ( as described above)

2. The most appropriate remedy for repair or replacement

3. That the landlord is neither financially or materially better of at the end of the tenancy, having taken into account (1) and exercised (2).`

So there you have it!

If you are looking for an agent that is well established, professional and communicative, then contact us to find out how we can get the best out of your investment property.

Email me on claire.harvey@seekersmaidstone.co.uk or call on 01622 671878. If you are in the area, feel free to pop into the office – we are based on 53 High Street, Maidstone, ME14 1SY. There is plenty of free parking and the kettle is always on.

Don't forget to visit the links below to view back dated deals and Maidstone Property News.

LinkedIn, www.linkedin.com/in/claireharveyestateagent
Blog, http://maidstonepropertyblog.blogspot.com/
Facebook, https://www.facebook.com/SeekersHomesUK
Twitter, https://twitter.com/seekershomes
Website, http://www.seekershomes.co.uk/