As the trees turn from green to hues of red and brown, Colchester property values and the property market has a confident feel to it. With the underlying fundamentals of a continued lack of properties being built, a shortage of properties (both in terms of quantity and quality) coming to the market and the continued low mortgage rate environment, enquiries from first time buyers and buy to landlords is strong and motivation is even stronger, given those inexpensive lending rates and general demand caused by under supply.
As always there are potential hurdles looming which could affect the UK and Colchester property values in the months to come. Theresa May still has to get her teeth into Brexit negotiations and the outcome of the US Presidential election could adversely affect money markets around the world, meaning that on the run up to Christmas, some savvy buyers may take advantage of the lack of certainty by making cheeky offers, but I don’t believe these will have a huge impact on property values (like the 2008 Credit Crunch).
You see, property ownership, whether it’s for yourself as a homeowner or buy to let landlord, is a long term investment. In fact, focusing on buy to let, a number of landlords who own property in Colchester have made contact with me recently asking for my thoughts on the future of the buy to let market in Colchester. Well, as the Politician Edmund Burke said in the 18th century, “Those who don’t know history are destined to repeat it.” – in other words, to see into the future you just have to look what happened in the past.
Since the Millennium, the housing market has had everything thrown at it. The recent Brexit, last year’s General Election, the near melt down of the World Economy with the Credit Crunch, The Dot Com boom and bust, the housing market crisis in 2008, the housing boom of 2001 to 2004 – the list goes on. In fact here is a graph (courtesy of the Land Registry) of average Colchester property values since the Millennium in the Colchester Borough Council area.
Despite the Dot Com bubble bursting in 2000, two years later in January 2002, Colchester property values in the Colchester Borough Council area have risen from £77,600 (in Jan 2000) to £104,00 – and kept rising to January 2008 when they peaked at £197,700. Then we had the Credit Crunch and Colchester property prices continued to fall until April 2009, where they averaged £144,900 – but look where they are right now: £240,100
The point I am trying to get across is long term future Colchester property values are more helpful to landlord investors than the month by month headline grabbing micro movements in the property market. Look at the graph and you will see the growth in property values is an upward trend BUT, the average darts about as each month goes by. So don’t watch the property indexes and panic if values drop next month or the month afterwards, because even in the glory days of 2001 to 2004 and 2012 to 2014, without fail, values always dropped slightly around Christmas, but people will always need a roof over their heads, and if they can’t buy and the council aren’t building anymore only buy to let landlords can meet that demand.
Colchester landlords are being hit in the pocket with the new up and coming taxation rules and we may well have a bumpy ride on the run up to Christmas (because of the points raised earlier) but Brexit or no Brexit, the long term trend is still likely to be a slow and steady increase in Colchester property values and demand for rental properties, and yields in the Colchester property market, into 2017 and beyond.
I’d welcome your opinions and comments on Colchester property values. I’m always available for an informal chat about any aspect of the Colchester property market properties please feel free to call me on 01206 862288 or email me at firstname.lastname@example.org – I am happy to provide free feedback without obligation.
I am happy to undertake free pre-purchase visits to your shortlist of potential properties to provide a rental valuation. If you send me a hyperlink to any property on Rightmove or Zoopla I usually reply within 24 hours.