Are the Stamp Duty changes, Elections, Buy-to-Let tax implications and general housing market slow down impacting the Leighton Buzzard and Dunstable housing market ?
We have seen huge rises in both property prices and rents in Luton, Dunstable, Leighton Buzzard and the surrounding areas in the last 18 months. Mostly this has been as a result of the overpriced London market forcing buyers and renters to look outside the capital for more affordable housing. Of course this has pushed prices up locally to a point where some would say it has now become unaffordable and those house hunters will now be looking further up the M1 and A1 to towns such as Northampton and Biggleswade.
Last Friday I took the opportunity to visit 5 or 6 of the local Agents and the message was the same from all of them. There is a short supply of new properties for sale compared to a year ago and offers on the properties they have are not arriving after the first viewings as they were. We are also finding the same with rental properties and this is being reflected in the number of properties both for sale and for rent that you see being reduced in price on the property portals.
Recent figures from HMRC show that the number of transactions nationally in the stamp duty bands fell in April to 83,010 from 107,090 in March. April’s figures cannot be compared on an annual basis as last April the number of transactions slumped after the rush in March 2016 to complete purchases before the new stamp duty rules on second properties started in April 2016. In fact when talking to a property expert and auctioneer recently he pointed out that many of those rushed transactions to save on the extra 3% stamp duty actually cost the buyers more as some agents inflated prices on typical BTL properties and the buyers in their rush were paying over the asking prices. At auction they had also witnessed properties selling for more than expected. If some of those buyers had waited until after the April deadline many properties were reduced in price and they could have made offers below the asking price. The saving made would have been easily more than the extra 3% they were trying to save on stamp duty.
What will this mean for an investor? In a slowing market with prices being reduced and properties taking longer to sell this could be the time to grab a bargain. Homeowners who have found a property to buy might now be in a position where they need to find a buyer for their own property and it is taking longer than it should.
If we look in Dunstable at current properties this one stands out as a potential investment property. Ok Viceroy Court in Dunstable does not have the best of reputations, but for a 1 bedroom flat with a guide price of £95,000 and over 140 years left on the lease it has to be worth a look especially with an expected minimum rental of £600pcm giving you a basic rental yield of 7.5%. This is a town centre location and walking distance for workers in Amazon and the Woodside Industrial Estate so demand for a rental property such as this is high at the right price.
Daniel Bourke is the owner of Belvoir Lettings Dunstable and in his previous career in Architecture he was an Associate in a leading London Architectural practice