What does this mean for existing homeowners in Sawbridgeworth and first time buyers?

People are always going to need a roof over their heads and somewhere to live will never go out of fashion – it’s a necessity for every single person.  The 22 to 30 year olds of the area have a choice to what type of roof they have .. they rent from a Housing Association, they can rent from a private landlord or finally they can get a mortgage and buy one. In the 1970’s/80’s and 90’s, the expected thing was to save like mad for two years for the deposit (going without luxuries) whilst living at home or renting a cheap two up two down, then buy your first house.

However, more recently fewer Sawbridgeworth youngsters have been buying, choosing to rent instead – mainly from private landlords. The numbers are truly staggering…and I want to share them with you.

Roll the clock back 10 years and Sawbridgeworth was a different place. There were 4,446 households in area and 3,532 of those were owner occupied (2,176 with a mortgage). Move to the present, and with the building in the area, the total number of households has increased moderately by 5% to 4,670 and quite surprising  (to me at least), the number of owner occupiers has slightly decreased to 3,472 (and now represents 74.3% compared with 79.4% ten years ago).

However, it’s rented sector that is truly fascinating … ten years ago, only 456 properties were privately rented in Sawbridgeworth.. and now its 710, a rise of 56%.

Demand for decent rented property remains high, as Cameron’s much vaunted house building program is years away and has decades of under investment to catch up on before it starts to affect demand.

The chances of these youngsters buying a property in Sawbridgeworth is diminishing with every year that passes, so private landlords in Sawbridgeworth still have an important role to play in housing the people of Sawbridgeworth. Even with the Buy-to-Let tax rule changes over the coming few years (which will see the maximum tax relief available to landlords drop from 45% to 20%), those landlords who educate themselves and treat it as a business will survive and prosper.

Change in number of households by tenure in the last decade

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The best method Sawbridgeworth landlords can maintain their income from property (and mitigate the effects of the tax rises) is to keep the homes they let out in Grade A condition. I have found, especially over the last three or four years, Sawbridgeworth tenants have ever growing demands from their rental property, but many are prepared to pay ‘top dollar‘ for houses and apartments that meet their high expectations.

You must not forget, letting property in Sawbridgeworth (in fact anywhere) is a business, so all private landlords should also seek the advice, opinion and commentary of property professionals.

For homeowners, property values over the last 24 months in Sawbridgeworth have risen by an impressive 15%, so even with the news Stamp Duty changes for Landlords coming in April my thoughts are with such low supply (i.e. numbers of homes for sale), and high demand, there won’t be much impact on Sawbridgeworth values.

It might interest you to note that over the last twelve months, only 217 properties have sold in the

Sawbridgeworth area, compared with 307 in 2007. I predict, ever so slightly, the proportion of owner occupiers should increase slightly compared to buy-to-let landlords in the coming decade as the housing market should return to balance.

Values have risen in CM21

Since 2008, prices in CM21 have increased by around 3% per year and the average price of all properties now stands at £346,400. While unsurprisingly the most expensive property type is Detached (with prices averaging £553,200), it is Detached homes which have seen the highest levels of annual growth – a healthy 4%graph-4

Sales levels in CM21 likely to have fallen in 2015

graph-2While prices in CM21 are now substantially higher they were at the peak of the last housing cycle in 2007 (59% higher), the same cannot be said of sales rates. Final data for 2015 is not yet available but we expect the data to show around 210 sales for 2015, 12% below the 2007 peak but in line with recent trends.

 

Local wealth bandsgraph-1

In CM21 the majority of households are classifieds as ‘Comfortable’ (37% of all households). This is 6% higher then the average in East. The next biggest wealth band is ‘Wealthy’ (30% of all households) which is 6% higher than the average in East.

 

How many cars do Sawbridgeworth folks have?

In CM21 the majority of households own one car (43% of all households). This is a fraction higher then the average in East of England. The next most common category of car ownership in CM21 is two cars (34% of all households) which is 5% higher than the average in the East of England.

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