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Maidstone Property Market – the Last 10 Years
One of my Maidstone landlords contacted me last week from Langley, after he had spoken to a landlord friend of his from Coxheath. He told me they were deliberating the Maidstone property market and neither of them could make their mind up if it was time to either sell or buy property following Covid-19. His friend said he would wait to see what would happen to property prices following Covid-19, yet my landlord wanted to pick my brain in order to help him decide what to do.
I said the press are aware bad news sells newspapers and the doom mongers are plying their trade on uncertainty in the world economic situation. Roll the clock back to the Credit Crunch of 2008/9, and there were quite a few landlords in Maidstone who had overexposed themselves with high percentage loan to value buy to let mortgages, backing the hope they would make their money on the capital growth, yet fell foul of a drop in rents and thus got bankrupted (but who could blame them when the property market was rising at 15% to 20% a year in the early 2000’s and banks like Northern Rock were giving mortgages out to anyone with a pulse and note from their Mum).
Thankfully the Bank of England changed the rules on all mortgages in 2014 banning self-certification mortgages, tightening the rules around interest-only mortgages and the requirement around affordability to be checked, plus a tough stress test if interest rates rose. It’s obvious we are going to enter into a recession because of Covid-19, yet this time the Maidstone property market is better placed to weather the storm.
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Maidstone Home Buyers & Landlords Set to Save £6,638,430 in Stamp Duty Over Next
The British are infatuated with owning their own property and politicians know that. Margaret Thatcher used it as a vote winner in 1979 when she allowed council house tenants to buy their own home. Coming to the present day, Boris Johnson’s Conservative government have anxieties that the Brits have not been buying nearly enough homes lately and, as with all countries in the world, the British property market was put ‘on ice’ for several months to help contain the Coronavirus, exacerbating the problem.
The Chancellor, Rishi Sunak, announced on Wednesday plans to boost the property market by momentarily scrapping Stamp Duty Tax (a tax paid by homebuyers) when they buy a property that costs less than £500,000.
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Maidstone Property Market – Is it Time to ‘Plan’ to Get the Builders In?
Even though the new legislation was placed on hold because of the recent General Election, it is expected the Government will start fining around half of all UK local authorities for failing to build enough new homes as Westminster starts to force local authorities to build more homes with the new laws.
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It seems that quite a few Maidstone homeowners and Maidstone landlords have become acclimatised to living with the uncertainty of Brexit throughout most of 2019, as figures show many of them decided to get on with living life, started reinvesting their money into Maidstone property and buying and selling their Maidstone homes and BTL investments. Land Registry stats confirm that. Current data shows that...
Maidstone property values are 3.2% lower than 12 months ago
Whilst the newspapers were stating prime central London property values were now 17% below the levels being achieved a couple of years, that message seems not to have been heard by certain sectors of the Maidstone property market!
Speaking with other property professionals in Maidstone, many weren’t expecting the usual autumn rebound after the summer holidays. Many were anticipating a dormant Maidstone property market on the run up to Christmas believing many Maidstone home-movers would put off the their home moving activities until the new year, yet in many sectors of the local property market, I have seen (and the stats back this up) that those Maidstone property buyers who are able to hold their nerve (whereas others were hesitant) have found themselves in a better negotiating position to get a great property deal.
Putting aside the fluff of newspaper headlines, the real foundations of Maidstone housing market remain sound with record low unemployment, ultra-low interest rates and low inflation.
Interestingly, there are 50% more homes for sale in Maidstone compared to two years ago, meaning more choice for buyers
However, there are still parts of the Maidstone property market that remain stagnant, with some homeowners being slightly unrealistic with their marketing pricing. To them, the property market appears to be slow, as they stare at their ‘for sale’ board for months on end, yet nothing could be further from the truth.
The key to a balanced (and healthy) property market is realistic pricing by the homeowners when they place the property on the market, mortgage affordability for buyers (which was discussed a couple of weeks ago in the Maidstone Property Blog) and buy to let landlord activity which creates and maintains forward momentum. One measure of momentum is how long a property remains on the market, and interestingly…
The current average length of time a Maidstone property remains on the market is 80 days, up slightly from 61 days two years ago
Now the number of properties sold locally is slightly down year on year (even though we had a burst of property sales in the summer locally) and interestingly, Rightmove reported recently that nationally, the number of properties sold in the UK was only just over 3% less year on year, so a similar picture nationally.
So, what does all this mean for Maidstone homeowners and Maidstone landlords?
We have always had issues that were game changers for the housing market; for the last few years it’s been Brexit, 10 years ago the credit crunch, 18 years ago the dot com crash, the ERM and 15% interest rates issue 27 years ago, dual MIRAS 32 years ago, hyper-inflation 40 years ago, the 3 day week 45 years ago – the list goes on. Everyone needs a home to live in, the local authority just has not got the money to build council houses, so buy to let will continue to grow for the foreseeable future which in turn creates a stable foundation for all homeowners. Maybe you should use this time, like many are in Maidstone to take advantage of the property deals to be had in Maidstone.