As my regular readers know, my passion is talking about the
Penicuik property market which I hope will be of interest to both homeowners
and buy to let landlords alike. However, this week, I want to highlight the
plight of the tenants of Penicuik as more and more of their wages are being
taken up by ever increasing rents.
The cost of renting a home in Penicuik has broken through
the £750 a month barrier as the average rent for a property in the town now
stands at £770 per month which is around 6.8% higher than 12 months ago.
House price inflation has certainly eased in Penicuik
from the heady days of 2014, but still with retail price inflation (for goods
and services) reducing to 0% any increase in property values, no matter how
small, means in real terms property is still getting more expensive. Meanwhile,
many tenants have given up saving for a mortgage deposit as rents continue to
take more and more of their wage packets leaving nothing to save for a deposit.
That means, more and more tenants are deciding to rent for the long term and
therefore the desire for decent high quality rental properties continues to
exceed the available rental stock.
I would go as far as to suggest that rents are an ideal
barometer to the state of the local economy as a whole and strongly believe
that the recent increase in Penicuik rents are a sign that the Penicuik economy
is picking up.
This means Penicuik landlords are continuing to
capitalise on the Penicuik property market. The most recent Registrars of
Scotland data suggests the annual property price rises in the town have eased
over 2015, leaving property values 1.23% higher than 12 months ago – last year
annual property price rises were running at 11.67%. With property price growth easing off, the increasing
rents mean that rental yields are strengthening for the first time in years to
compensate. The mortgage market has become more stable after the mad months of
May and June after the Tory’s got back into No.10, and so, everything is set to
be good news for landlords; even with the Chancellors change of tax rules in
the coming years for buy to let mortgages.
You can get some amazingly low mortgage rate deals at the
moment, so with mortgage rates so low and returns still extraordinarily
attractive, there’s rarely been a better time to invest in rental properties.
However, (you knew there would be a however!), it’s all
about buying the right property at the right price. Not all property types are
seeing equal rises in rents and capital growth.
Different parts of the town, different types of properties are
experiencing quite different changes.
For example, the average length of time Penicuik one bed properties take
to rent is 13 days whereas it takes on average 30 and 72 days to rent 3 and 4
bed properties respectively.
When you start comparing different parts of Penicuik, the
numbers are even stranger! The bottom
line is that you must take advice and opinion. One source of advice and opinion
is the Penicuik Property Blog. In the Penicuik Property Blog, you will see many
more articles like this, discussions and even what I consider to be the best
buy to let deals around, irrespective of which agent is selling it.
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