I had this really interesting chat with some of my tenants the other day on renewal of their tenancy agreement. They are a lovely couple in their early thirties and I know they have decent jobs in London. They have been tenants of ours for a while now, so I know them quite well. We got talking and I asked if they had ever thought of buying a property for themselves, to which they replied back with the title of this article. It made me think and so I did some more research into the subject which I want to share with you.
After the end of the Second World War, just over a quarter of the UK population owned their own home, the rest rented from private landlords or the local Council. However, if someone told you in the 1970’s and 1980’s that they rented, they were considered a second class citizen! Everyone wanted to own their own home .. it was the done thing. We still think that home ownership will inevitably happen, but it won't.
It all changed in the 1970’s when two things happened. Firstly, the number of people who owned their own home broke through the 50% barrier in 1971 and by 1981 it was at 57%. Tied in with that, the average house prices in Teddington were doubling at one point every four years in the 1970’s so property and profit started to feed off each other. To put that growth in context, if we were to look at the last 85 years in Teddington, in 1930, the average Teddington property was worth £835. The average property value in Teddington currently stands at £708,101. It's not hard to do the maths!
We could blame Maggie Thatcher for making home ownership the ultimate goal, but what we now need to consider is that the country is turning on its head and we need to, as a country, love renting again. Some blame the banks, but obtaining a 95% mortgage is hard work, but nowhere near impossible. A typical Teddington first time buyer would only need to save £17,000 for a deposit and fees and they could buy a pretty decent one bed property. For example, you could buy a property on Stanley Road in Teddington, and it would be cheaper each month in mortgage payments than renting.
People might say on the surveys they want to buy, but when it comes down to it, if you have been living in a lovely big house on Fairfax Rd, but the bank will only lend you enough to buy a two bed flat on the Harrowdene Gardens estate, what would you do? Don’t get me wrong, Harrowdene Gardens has really pulled its socks up over the last ten years, but it isn't Fairfax Road, is it? Again, if you were a twenty something, what would you do? Have another read of the title of the post ... “The way it works is, you have to rent where you want to live, or buy where you don’t want to live,”
With tenant demand only going in one direction, that is probably why more and more people are getting into buy to let in Teddington. With the new rules on pensions and the ability to use them to buy residential rental properties from April onwards, this could be the time for you to buy a rental property. You must take advice on your pension from an Independent Financial Advisor (there are plenty in Teddington) and you must take advice from people who know what to buy (and not to buy) in Teddington to ensure you get the best from your investment.
Please do give me a call or drop me an email if this is ringing true with you - I'd be happy to offer you my opinion - a chat doesn't cost you a penny! :o)
Now I have to apologise for today's picture, its a little close to the bone, but definitely made me laugh!
Rebecca Smith
http://www.rebeccasmithpropertyservices.co.uk/
020 8398 9333
rebecca@rebeccasmithpropertyservices.co.uk
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