I’ve spoken to a few of Penicuik’s landlords since the New
Year who feel the property market may be about to flatten out, having seen
sensational gains over the past few decades.
On the other hand there are others I’ve met who are new to buy-to-let and comparing what else they can do with their money today, rather than seeing property as expensive now compared to the past.
And as I’ve said many times, property still remains one of the best places you can put your money based on the facts as we know them today. Those facts being that yields in Penicuik are around 6-7% on average, which is significantly higher than the sub 1% available from savings accounts. It’s also higher than the average yield from the FTSE 100 (3.75%) and the average rate of mortgage finance.
It’s easy to fall into the trap, as I have done in the past, of thinking “well I’m not paying £140,000 for that two bed house when next door sold for just £110,000 three years ago”. We have to remember it’s not three years ago however and base our decisions on the opportunities available now.
I do still find myself reflecting on “what might have been” though. Most recently a three bed mid-terrace on Teviot Grove sold for £147,800 - more than times three the £44,800 it cost ten years ago back in March 2007.
There’s still some who are making gains from short-term property transactions although I am not a great fan of ‘doer-uppers’ (ie people who buy, do up and sell shortly thereafter) as this leaves you exposed to the short term vagaries of the property market.
Nonetheless, some shrewd buyer on Rullion Green Avenue has made short-term gains at the beginning of this year. Having paid £90,000 for a house January 2016 they re-sold it for £103,500 in January 2017.
On the other hand there are others I’ve met who are new to buy-to-let and comparing what else they can do with their money today, rather than seeing property as expensive now compared to the past.
And as I’ve said many times, property still remains one of the best places you can put your money based on the facts as we know them today. Those facts being that yields in Penicuik are around 6-7% on average, which is significantly higher than the sub 1% available from savings accounts. It’s also higher than the average yield from the FTSE 100 (3.75%) and the average rate of mortgage finance.
It’s easy to fall into the trap, as I have done in the past, of thinking “well I’m not paying £140,000 for that two bed house when next door sold for just £110,000 three years ago”. We have to remember it’s not three years ago however and base our decisions on the opportunities available now.
I do still find myself reflecting on “what might have been” though. Most recently a three bed mid-terrace on Teviot Grove sold for £147,800 - more than times three the £44,800 it cost ten years ago back in March 2007.
There’s still some who are making gains from short-term property transactions although I am not a great fan of ‘doer-uppers’ (ie people who buy, do up and sell shortly thereafter) as this leaves you exposed to the short term vagaries of the property market.
Nonetheless, some shrewd buyer on Rullion Green Avenue has made short-term gains at the beginning of this year. Having paid £90,000 for a house January 2016 they re-sold it for £103,500 in January 2017.
Property is not all a one-way bet however, particularly
in the short-term, as one buyer of the flat in the new Dalmore development in
Auchendinny found out. Having paid £230,000
in May 2015, presumably a change of circumstances meant they had to settle for
£6,000 less when they sold it 20 months later in January 2017 (and pay all the
associated buying & selling costs).
Even the past decade hasn’t been kind to all property buyers either. Whilst the average property in Penicuik has increased by 20% since 2007, in November 2016 a house on Cuiken Terrace changed hands for £100,000 - some £16,200 (14%) less than the previous owners had paid nine years earlier.
I still think there is value to be found in Penicuik’s property market – you just need to look a little harder and grind down into the fundamentals of a property a little more than you used to although the surprisingly high level of rents that are being achieved at the moment is very helpful.
Even the past decade hasn’t been kind to all property buyers either. Whilst the average property in Penicuik has increased by 20% since 2007, in November 2016 a house on Cuiken Terrace changed hands for £100,000 - some £16,200 (14%) less than the previous owners had paid nine years earlier.
I still think there is value to be found in Penicuik’s property market – you just need to look a little harder and grind down into the fundamentals of a property a little more than you used to although the surprisingly high level of rents that are being achieved at the moment is very helpful.
As I don’t sell property I’m happy to give some free impartial advice to would-be investors to help find a property that suits your requirements. If you’re interested just give me a call.
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