Last week, a couple from Isleworth, called to discuss potentially investing in the Teddington property market for the first time.
As my regular readers will know, the most important consideration you will make before investing in property is the balance between annual return and capital growth. However, what affects those two things in Teddington are very varied and complex. The quantity of property available and whether that property is owner occupied, social housing, or private renting can make a big difference on how much money you can make from it, in particular, the capital growth.
In 2001, owner occupation of property in Teddington was 72.45%. The significant change over the decade (2001 to 2011) was within the rental sector, where the proportion of households privately renting increased from 13.33% to 18.47%, whilst those socially renting had decreased from 10.29% to 8.4%.
Between 2001 and 2011, the total number of households in Teddington rose from 45,100 to 47,094, an increase of 4.24%. However, the percentage of households that were owner occupiers in Teddington dropped to 66.23%.
That doesn’t tell the full story though, whilst there was a significant drop in the percentages (72.5% to 66.2%), the actual numbers tell a completely different tale. Of the 32,683 households in Teddington that were owner occupied in 2001, that figure had actually increased to 34,014 households being owner occupied. So why the relatively significant drop in percentages despite the rise in figures?
In 2001, 6,014 houses were privately rented (13.33%) in Teddington but, roll on another ten years, and there are 8,701 households in Teddington that are privately rented (18.47%). The rapid increase in the number of households privately renting could be linked to the decline in the number of residents getting on the housing ladder, usually by way of a mortgage. This is mainly because of the increasing difficulty for first time buyers being able to raise deposits for a mortgage, which hasn’t been helped by rising property prices. This meant larger deposits, which are linked to the house price, were required. Also tighter lending requirements, especially in the wake of the recent credit crunch, meant a larger percentage of the house value was required as a deposit, as 100% mortgages became a thing of the past.
Finally, declining wage growth and rising inflation over the period exerted pressure on household spending and eroded the value of savings. This means that households have needed to save for a longer period in order to provide a deposit.
If you want any help or advice on any of this then please do feel free to give me a call on 0208 398 9333 or drop me an email at rebecca@rebeccasmithpropertyservices.co.uk. I am the founder and owner of Rebecca Smith Property Services and can help you to find your next rental property, find you a tenant AND manage it for you. The full whammy! :o)
My sister sent me this piccy - it's the simple things that make you laugh...!
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