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Thursday, February 25, 2016

Maidenhead Landlords count the cost of a Tory Election win



Can you remember 10.05pm on Thursday, 7th May 2015 ... with the shock news that BBC Exit Polls suggested the Conservatives would be returned with majority? The middle classes in Burchetts Green and Woodlands Park exhaled a huge sigh of relief, and Maidenhead landlords, faced with rent controls from Red Ed and the Labour Party, now had something to cheer about as the Tory’s were always considered to be a political party that accepted the importance of the rental market, supported its development while properly targeting the lawbreaker landlords renting out below standard rental accommodation.

Since May though, George Osborne has announced future rises in stamp duty for buy to let landlords and a change in the interest relief on buy to let mortgages, and some people have started to question that loyalty. However, things could have been a lot worse for Maidenhead landlords as the idea of making landlord’s pay more tax by increasing Capital Gains Tax rates to the landlord’s own income tax levels was seriously considered. If Landlords had to pay capital gains tax of 40% to 45% on any uplift in value, I can tell you here and now, that would have made investing in property a non starter for almost everyone.

However, I will admit the loss of mortgage higher rate tax relief will make a number of properties not stack up financially. The new rules are likely to slow demand in the Maidenhead housing market, which is in fact good news for the other landlords, as there is less competition from 'amateur' landlords offering too much.

Just a thought, but making Maidenhead landlords think twice and
run their numbers more cautiously is not such a bad thing.

So looking at the numbers, the December figures have just been released and they show a 0% change in property values in Maidenhead over the month of December. That figure doesn’t surprise me due to the time of year. It’s quite dangerous to look at one month in isolation, so looking at a more medium term view, over the last 12 months, property values in Maidenhead have risen by 10.3%, not bad when you consider inflation is running at -0.1%.

However, regular readers of the Maidenhead Property Blog know my passion for looking deeper into the stats. The really interesting information is the value growth, but what types of property are actually selling in Maidenhead?  Looking at all the properties sold, as recorded by the Land Registry, within 3 miles of the centre of Maidenhead in September 2015 (this data always runs a couple of months behind the house price data) compared to September 2007 (a couple of months before the credit crunch started to bite and the subsequent property crash).


Sept 2007
Sept 2015
Difference
Detached in Maidenhead
49
44
-10%
Semis in Maidenhead
51
31
-39%
Terraced Houses in Maidenhead
27
31
+15%
Apartments / Flats in Maidenhead
56
30
-46%

Now I have mentioned in previous articles that the numbers of properties selling in the town has certainly dropped post 2008, but what amazed me were the drop in the number of semis and apartments selling in Maidenhead compared to the sales of terraced properties, which rose slightly.

Less properties are selling now than in the last decade in Maidenhead
and the types of properties selling have changed ...
interesting times ahead for the Maidenhead Property market!


Therefore, all I can say to the landlords of Maidenhead is do your homework, make sure the numbers do stack up, take advice and opinion from professionals and above all, for those of you planning to add to your portfolio, buy the right property at the right price. 

One place for such advice and opinion on the Maidenhead Property market is the Maidenhead Property Blog

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