As my regular readers know, my passion is talking about Lancaster property. As a property agent I like to comment on the Lancaster property market, which I hope will be of interest to both homeowners and buy to let landlords alike. However, this week, I want to highlight the plight of the tenants of Lancaster as more and more of their wages are being taken up by ever increasing rents.
Even with average rents dropping by 0.8% last month, the cost of renting a home in Lancaster still stands at £524 per month. House price inflation has certainly eased in Lancaster from the heady days of 2014, but still with retail price inflation (for goods and services) reducing to 0% any increase in property values, no matter how small, means in real terms property is still getting more expensive. Meanwhile, many tenants have given up saving for a mortgage deposit as rents continue to take more and more of their wage packets leaving nothing to save for a deposit. That means, more and more tenants are deciding to rent for the long term and therefore the desire for decent high quality rental properties continues to exceed the available rental stock.
I would go as far as to suggest that rents are an ideal barometer to the state of the local economy as a whole and strongly believe that the recent increase in Lancaster rents are a sign that the Lancaster economy is picking up.
This means Lancaster landlords are continuing to capitalise on the Lancaster property market. The most recent Land Registry data suggests the annual property price rises in the city have eased over 2015, leaving property values only 3.56% higher than 12 months ago, so as property price growth is easing off, with the increased rents, rental yields are strengthening for the first time in years to compensate. The mortgage market has become more stable after the mad months of May and June after the Tory’s got back into No.10, and so, everything is set to be good news for landlords; even with the Chancellors change of tax rules in the coming years for buy to let mortgages.
You can get some amazingly low mortgage rate deals at the moment, so with mortgage rates so low and returns still extraordinarily attractive, there’s rarely been a better time to invest in rental properties.
However, (you knew there would be a however!), it’s all about buying the right property at the right price. Not all property types are seeing equal rises in rents and capital growth. Different parts of the city, different types of properties are experiencing quite different changes. For example, the average length of time the 86 Lancaster properties up for rent between £250 to £500 per month is an eye watering 226 days, whilst the average length of time the 95 properties at £500 to £1000 per month is 53 days and 1 property that falls into the £1000 to £2000 per month price bracket is 9 days. ( This was let out by agency ). If you are wondering why this, why not ask me?
When you start comparing different parts of Lancaster, the numbers are even stranger! The bottom line is that you must take advice and opinion. One source of advice and opinion is this Lancaster Property Blog. In the Lancaster Property Blog, you will see many more articles like this, discussions and even what I consider to be the best buy to let deals around, irrespective of which agent is selling it.
Whether you are a landlord, ‘Homes Under the Hammer’ addict or just a homeowner who is interested in what is happening to the local property market, then keep checking back on this page!
Thanks for reading