May 2, 2017
So all cards are up in the air! A general election is scheduled for June to decide who will be leading our country in our Brexit negotiations. There’s a lot of uncertainty but one thing is for sure… whoever gets the job to deal with Brexit has a hard job on their hands (I’m just glad its not me!)
As it currently stands, by not assuring the rights of EU citizens in the UK, Theresa May has squandered an opportunity to give peace of mind to our EU co-workers working and living in Rotherham (and the rest of the UK). Downing Street’s point of view is that, in promising the rights of EU citizens in the UK, it will postpone the same guarantee to the 1.5 million UK citizens living in the other nations of the EU.
Putting aside the politics for one second, the simple fact is now Article 50 has been triggered, we have two years to make a deal with the EU – otherwise we face the reality of a ‘no deal’ situation. This will be a very ‘hard Brexit’.
You might not think a hard Brexit will affect you in your home in Rotherham… but nothing could be further from the truth.
Of the 255,334 people who live in our area, 1,712 were born in EU countries from Western Europe and 2,755 were born in EU countries from Eastern Europe (the rest coming from other countries around the world).
The rights of these EU citizens living in the Rotherham area are currently not guaranteed and will now be part of the negotiation with Europe. Our EU next door neighbours have had the right to live, to work, to own a business, to possess a property, to access health and education services and to remain in a UK after retirement… yet those acquired rights are up for negotiation in the next two years.
So, what would a hard Brexit do to the Rotherham property market?
A hard Brexit could cause a nuclear reaction when it comes to our property market. Until rights are properly guaranteed there is the possibility that every EU citizen would have to leave the UK.
In Rotherham, 65% of Western European EU citizens own their own home in the UK. If EU citizens had to leave these properties would need to be sold. Additionally, just under 74% of Eastern European EU citizens rent a property, so again all those rental properties would be vacated and come onto the market at the same time.
A hard Brexit leading to mass EU migration could mean 1,500 properties being dumped onto the housing market in a short period of time.
This would lead to a massive drop in Rotherham property values and rents, causing negative equity for thousands of Rotherham homeowners and leaving many buy-to-let landlords out of pocket.
While there is no certainty as to what the future will hold, both UK expats in the EU and EU citizens in the UK rights will no longer be guaranteed and will be subject to bilateral renegotiation.
All I ask is that the politicians are sensible with each other in the negotiations. A lot of the success of the Rotherham (and the UK) property market has been built on high levels of homeownership and more recently in the last 10/15 years, a growth of the rental sector with lots of demand from Eastern Europeans coming to Rotherham and the surrounding area to get work and provide for their families. Many Rotherham people have also invested their life savings into buying a buy-to-let property.
Much will depend on what is politically realistic.
Unilateral knee-jerk reactions and measures caused by a hard Brexit would not only likely cause major disruption or suffering to the 3 million EU citizens living in the UK, but also everyone who owns property in the UK. It’s been interesting that none of the leading parties have picked up on this in the opening weeks of the General Election conversation.
Politics aside – reaching the end of these two years with ‘no deal’ and a hard Brexit is really in nobody’s interest.
Are you looking for tips and advice about the Rotherham property market? Follow me on Facebook or Twitter for the latest information.
Apr 28, 2017
This was a question posed to me on social media a few weeks ago, after my article about our mature members of Rotherham society and the fact many retirees feel trapped in their homes. After working hard for many years and buying a home for themselves and their family, the children have subsequently flown the nest and now they are left to rattle round in a big house. Many feel trapped in their big homes (hence I dubbed these Rotherham home owning mature members of our society, ‘Generation Trapped’).
So, should we force OAP Rotherham homeowners to downsize?
Well in the original article, I suggested that we as a society should encourage, through tax breaks and social acceptance, that it’s a good thing to downsize. But should the Government force OAPs?
Well, one of the biggest reasons OAPs move home is health (or lack of it).
15.98% of Rotherham home owning OAPs are in poor health
Looking at the statistics for Rotherham: there are 12,218 homeowners who are 65+ years old. Whilst 5,882 of them described themselves in good or very good health, a sizeable 4,383 home owning OAPs described themselves as in fair health and 1,953 in bad or very bad health. That’s nearly 16% who are in poor health:
A lack of retirement homes
In the Rotherham Metropolitan Borough Council area there are no specialist retirement homes that one could buy and only 2,766 homes available to rent from the Council and other specialist providers. Many older homeowners wouldn’t feel comfortable with the idea of renting a retirement property after enjoying the security of owning their own home for most of their adult lives.
My intuition tells me the majority ‘would be’ Rotherham downsizers could certainly afford to move but are staying put in bigger family homes because they can’t find a suitable smaller property. The fact is there simply aren’t enough bungalows for the healthy older members of the Rotherham population and specialist retirement properties for the ones who aren’t in such good health … we need to build more appropriate houses in Rotherham.
The failure of the ambiguous Housing White Paper
The Government’s Housing White Paper, published a few weeks ago, could have solved so many problems with the UK housing market, including the issue of homing our aging population. Instead, it ended up feeling annoyingly ambiguous.
Forcing our older generation to move with such measures as a punitive taxation (say a tax on wasted bedrooms for people who are retired) would be the wrong thing to do. Instead of the stick – maybe the Government could use the carrot tactics and offered tax breaks for downsizers? Who knows – but something surely has to happen. The Housing White Paper may have possibly been a wasted opportunity.
‘Downsize’ is an awful word
Isn’t ‘downsize’ such an awful word? This phrase (and others) feel like our OAPs are lowering and downgrading themselves in their retirement (and let’s be frank – no one likes to be downgraded). I prefer to use the word ‘decent-size’ instead of ‘downsize’.
The simple fact is we are living longer as a population and constantly growing with increased birth rates and immigration.
My advice to homeowners and property investors
What I would say to all the homeowners and property owning public of Rotherham is this: more houses and apartments need to be built in the Rotherham area, especially more specialist retirement properties and bungalows. The Government had a golden opportunity with the White Paper – and were sadly found lacking.
To those Rotherham property investors who read this blog: whilst this issue gets sorted in the coming decade(s), I would recommend considering doing up older bungalows. It seems that people will pay handsomely for them whether they are for sale or available to rent.
Just a thought!
For more of my expert thoughts regarding the Rotherham property market, please follow me on Facebook and Twitter.
Apr 25, 2017
It might surprise you that it isn’t always the swankiest Rotherham streets or the posh villages in the Rotherham area where properties sell and let the quickest. Quite often, it’s the ones that have the best transport links.
As an agent in Rotherham, I am frequently confronted with queries about our property market. Often people (chiefly by newcomers to the area) ask, “What is the best part of Rotherham area to live in these days?” The answer is obviously different for each person – a lot depends on a variety of different factors (the demographics of their family, their age, schooling requirements and interests etc.) Nonetheless, one of the principal necessities for most tenants and buyers is ease of access to transport links, including public transport – of which the railways are very important.
Official figures recently released state that a total of 947 people jump on a train each and every day from Rotherham Central. Of those, 416 are season ticket holders. That’s a lot of money being spent. For example, consider a standard class season ticket to Leeds is £2452 a year. This means up to £1m and possibly more is being spent on rail season tickets each year in our town.
If that much is being spent, those commuters must have some impressive jobs and incomes to allow them to afford that season ticket in the first place.
That means demand for middle to upper market properties remains strong in Rotherham and the surrounding area. In turn, these are the type of people whom are happy to invest in the Rotherham buy-to-let market – providing homes for the tenants in our town.
The bottom line is that property values in Rotherham would be much lower, by at least 3% to 4%, if it wasn’t for the proximity of the railway station and the people it serves in the town
And this isn’t a flash in the pan. Rail is becoming increasingly important as the costs associated with car travel continue to rise and roads are becoming more and more congested. This has resulted in a huge surge in rail travel. 
Overall usage of the station at Rotherham has increased over the last 20 years.
In 1997, a total of 356,901 people went through the barriers or connected with another train at the station in that 12-month period. However, in 2016, that figure had risen to 689,540 people using the station.
The juxtaposition of the property and the train station has an important effect on the value and saleability of a Rotherham property.
It is also significant for tenants – so if you are a Rotherham buy to let investor looking for a property – the distance to and from the railway station can be extremely significant.
One of the first things house buyers and tenants do when surfing the web for somewhere to live is find out the proximity of a property to the train station. That is why Rightmove displays the distance to the railway station alongside each and every property on their website.
For the latest thoughts on the Rotherham property market follow me on Twitter or Facebook.
Apr 24, 2017
If you are planning to sell your Rotherham house this year you may not need to look further than Fenton Board who are helping people ‘spring into action’ during these spring months.
There is no better time to move house than during these months and demand is currently high.
If you are looking for a local estate agent in Rotherham then get in touch with Fenton Board for more information about how to sell your property with them. All their details are included in the promo below. Alternatively, I offer all the readers of this blog my best advice about the property market in our area so please get in touch if you need my help.
Apr 20, 2017
I always like to give my readers the best information about the Rotherham property market and here’s my latest top tip: from April through to June, Bricknells Rentals have reduced the set up costs to £50 + VAT with no hidden extra set up fees.
If you are a prospective buy-to-let landlord this could be the deal for you to reduce your costs as you look to rent your property to tenants in Rotherham. Check out the full details in the promotional image below. You can get in touch with Bricknells Rentals directly or contact me for more information.
Apr 11, 2017
The property market here in Rotherham is a very interesting animal and has been particularly fascinating over the last 12 years in the case of Rotherham rents and house prices.
There’s currently much talk of what will happen to the rental property market post-Brexit. To judge that, we must remain rational and methodical by looking what happened in the 2008/9 credit crunch (and what has happened since). From there we can see the possible ramifications for long-term investors in the local property market.
An important yet overlooked measure is the performance of rental income vs house prices (i.e. the resultant yields over time). In Rotherham (as for the rest of Great Britain), notwithstanding a slight drop in 2008 and 2009, property rentals have been gradually increasing.
The income from rentals has been progressively increasing over the last 12 years.
Today rents are 16.7% higher than they were at the beginning of 2005.
In fact, over the last five years, the average growth has been 0.9% per annum. From a landlord’s point of view, this increase in average rental income is not to be sneered at. However, the observant readers will be noting that we are ignoring an important factor – inflation.
Turn the clock back to 2005, and we have a property being rented for say £900 a month and that is still being rented at £900 a month today, in spring of 2017. While the landlord is not getting any less income, this £900 is no longer worth as much due to a bigger rise in inflation during the same period. Total inflation since 2005 has been 38.5%. This means when we compare rents in Rotherham to inflation since 2005, Rotherham landlords are worse off today from their monthly rental income than they were in 2005 by 21.8% in real terms.
Don’t forget property values!
However, rental income is not the only way to generate money from property – property values can also increase.
Although in the short term, cash flows are diminishing, many Rotherham landlords may be content to accept that for a colossal increase in capital value. For example, in Rotherham:
Property values have risen by 23.1% since 2005
This equates to a reasonably salubrious 1.92% per annum increase over the last 12 years. Even more interesting is that this includes the 2008/9 property crash – a fact that will make landlords and investors feel a little better about the information regarding rents after inflation.
Moving forward, the prospects of making easy money on buy-to-let in Rotherham have diminished compared to the previous decade. In 2005, making money from buy-to-let was as easy as falling off a log… this is just not the case anymore.
I am often asked to look at my landlord’s rental portfolios so studying and comparing rental prices and house prices is valuable. To ascertain the spread of your investment across multiple properties it’s important to judge whether what you currently have will meet the needs of the investment in the future. It’s the balance of capital growth and yield, whilst diversifying this risk.
If you are investing in the Rotherham property market, do your homework and do it well.
While some yields may look attractive, there are properties in many areas that do not have the solid rudiments in place to sustain them. If you are looking for capital growth, you might be surprised where the hidden gems really are. Take advice and even ask your agent for a portfolio analysis. The majority of agents in Rotherham will be able to give a detailed analysis of past and anticipated investment opportunity (especially the awful effect of inflation) on your portfolio. However, if they can’t help – well, you know where I am! The kettle is on so please get in touch.
You can also follow me on Facebook or Twitter for the latest news about the Rotherham property market and further afield.
What I would say to all the homeowners and property owning public of Rotherham is this: more houses and apartments need to be built in the Rotherham area, especially more specialist retirement properties and bungalows. The Government had a golden opportunity with the White Paper – and were sadly found lacking.
