Peterborough’s ‘Millennials’ set to inherit £225,031 each in property!

That got your attention … didn’t it!

But before we start, what is Generation X, let alone Generation Z, Millennials, Baby Boomers  … these are phrases banded around about the different life stages (or sub-components) of our society. But when terminologies like this are used as often and habitually as these phrases (i.e. Gen X this, Millennial that etc.), it appears particularly vital we have some practical idea of what these terms actually mean. The fact is that everyone uses these phrases, but often, like myself, they are not exactly sure where the lines are drawn …until now…

So, for clarity …

Generation Z:              Born after 1996

Millennials:                 Born 1977 to 1995

Generation X:              Born 1965 to 1976

Baby Boomers:            Born 1946 to 1964

Silent Generation:       Born 1945 and before

My research shows there are 15,344 households in Peterborough owned by Peterborough Baby Boomers (born 1946 to 1964) and Peterborough’s Silent Generation (born 1945 and before). It also shows there are 35,941 Generation X’s of Peterborough (Peterborough people born between 1965 to 1976). Looking at demographics, homeownership statistics and current life expectancy, around two-thirds of those Peterborough 35,941 Generation X’s have parents and grandparents who own those 15,344 Peterborough properties.

… and they will profit from one of the biggest inheritance explosions of any post-war generation to the tune of £3.474bn of Peterborough property or £144,911 each but they will have to wait until their early 60’s to get it!

However, it’s the Millennials that are in line for an even bigger inheritance windfall.

There are 28,807 Millennials in Peterborough and my research shows around two thirds of them are set to inherit the 19,098 Peterborough Generation X’s properties. Those Generation X’s Peterborough homes are worth £4.324bn meaning, on average, each Millennial will inherit £225,031; but not until at least 2040 to 2060!

While the Peterborough Millennials have done far less well in amassing their own savings and assets, they are more likely to take advantage of an inheritance boom in the years to come. This will probably be very welcome news for those Peterborough Millennials, including some from poorer upbringings who in the past would have been unlikely to receive gifts and legacies.

However, inheritance is not the magic weapon that will get the Millennials on to the Peterborough housing ladder or tackle growing wealth cracks in UK society, as the inheritance is unlikely to be made available when they are trying to buy their first home…but before all you Peterborough Millennials start running up debts, over 50% of females and around 35% of men are going to have to pay for nursing home care. Interestingly, I read recently that a quarter of people who have to pay for their care, run out of money.

So, if you are a Peterborough Millennial there potentially will be nothing left for you.

Of course, most parents want to give their children an inheritance, the consideration that what you have worked genuinely hard for over your working life won’t go to your children to help them through their lives is a really awful one … maybe that is why I am seeing a lot of Peterborough grandparents doing something meaningful, and helping their grandchildren, the Millennials, with the deposit for their first house.

One solution to the housing crisis in Peterborough (and the UK as a whole) is if grandparents, where they are able to, help financially with the deposit for a house. Buying is cheaper than renting – we have proved it many times in these articles … so, it’s not a case of not affording the mortgage, the issue is raising the 5% to 10% mortgage deposit for these Millennials.

Maybe families should be distributing a part of the family wealth now (in the form of helping with house deposits) as opposed to waiting to the end… it will make so much more of a difference to everyone in the long run.

Just a thought?

Peterborough’s £276,484,320 “Rentirement” Property Market Time Bomb

Yes, I said ‘rentirement’, not retirement … rentirement and it relates to the 1,722 (and growing) Peterborough people, who don’t own their own Peterborough home but rent their home, privately from a buy to let landlord and who are currently in their 50’s and early to mid-60’s.

The truth is that these Peterborough people are prospectively soon to retire with little more than their state pension of £155.95 per week, probably with a small private pension of a couple of hundred pounds a month, meaning the average Peterborough retiree can expect to retire on about £200 a week once they retire at 67.

The average rent in Peterborough is £669 a month, so a lot of the retirement “income” will be taken up in rent, meaning the remainder will have to be paid for out their savings or the taxpayer will have to stump up the bill (and with life expectancy currently in the mid to late 80’s, that is quite a big bill …  a total of £276,484,320

over the next 20 years to be paid from the tenant’s savings or the taxpayers coffers to be precise!

You might say it’s not fair for Peterborough tax payers to pick up the bill and that these mature Peterborough renters should start saving thousands of pounds a year now to be able to afford their rent in retirement.  However, in many circumstances, the reason these people are privately renting in the first place is that they were never able to find the money for a mortgage deposit on their home in the first place, or didn’t earn enough to qualify for a mortgage …and now as they approach retirement with hope of a nice council bungalow, that hope is diminishing because of the council house sell off in the 1980’s!

For a change, the Peterborough 30 to 40 somethings will be better off, as their parents are more likely to be homeowners and cascade their equity down the line when their parents pass away.  For example, that is what is happening in Europe where renting is common, the majority of people rent in their 20’s, 30’s and 40’s, but by the time they hit 50’s and 60’s (and retirement), they will invest the money they have inherited from their parents passing away and buy their own home.

So, what does this all mean for buy to let landlords in Peterborough?

Have you noticed how the new homes builders don’t build bungalows anymore … in fact some would said the ‘bungalow storey’ is over.  The waning in the number of bungalows being built has more to do with supply than demand.  The fact is that for new homes builders there is more money in constructing houses than there is in constructing bungalows.  Bungalows are voracious when it comes to land they need as because bungalow has a larger footprint for the same amount of square meterage as a two/three storey house due to the fact they are on one level instead of two or three.

That means, as demand will continue to rise for bungalows supply will remain the same.  We all know what happens when demand outs strips supply … prices (i.e. rents) for bungalows will inevitably go up.

Peterborough Private Rents Hit £9.59 per sq. foot

As I am sure you are aware, one of the best things about my job as an agent is helping Peterborough landlords with their strategic portfolio management. Gone are the days of making money by buying any old Peterborough property to rent out or sell on. Nowadays, property investment is both an art and science. The art is your gut reaction to a property, but with the power of the internet and the way the Peterborough property market has gone in the last 11 years, science must also play its part on a property’s future viability for investment.

Many metrics most property professionals (including myself) use when deciding the viability of a rental property is what properties are selling for, the average rent, the yield and an average value per square foot.

However, another metric I like to use is the average rent per square foot. The reason being is that is a great way to judge a property from the point of view of the tenant … what space they get for their money. Now of course, location location, location (in a Phil and Kirstie style) has a huge influencing factor when it comes to rents (and hence rent per square foot). Like people buying a property, tenants also have that balancing act between better/worse location, more vs. less money and size of accommodation (bigger and more rooms equaling more money) and where they live (location) verses making ends meet.

Interestingly, I know there are a lot of you in Peterborough who like to see my statistics on the Peterborough property market, so before I talk about the rental figures per square foot, I wanted to share the £ per square foot on the values. In Peterborough, the current AVERAGE figures are being achieved (and I must stress, these are average figures, so there will an enormous range in these figures), but on average, properties in Peterborough, split down by type are achieving …

  • Peterborough Detached Property – £229 / sq ft
  • Peterborough Semi Detached Property – £212 / sq ft
  • Peterborough Terraced Property – £198 / sq ft
  • Peterborough Apartments – £193 / sq ft

So, the rental figures:

The extent of space you get for your rent is replicated in the space you get for your money when buying a property. The average size of rental property in the Peterborough area is 823.2 sq ft (interesting when compared to the national average of 792.1 sq ft)

This means the average rent per square foot currently being achieved on a Peterborough rental property is £9.59 per sq ft per annum.

So, what we can deduce from this?  Well the devil is always in detail!

Whilst I was able to quote the average overall figure and the fact my research showed it was quite clear from data that there is a relationship between the average £ per sq ft figures on property values and average £ per sq ft on rental figures as a property grows in size. However, something quite intriguing happens to those figures, in terms of what the property will sell for and what it will rent for, when we change and increase the size of the property.

My research showed that doubling the size of any Peterborough property doesn’t mean you will double the value of it … in either value or rent. This is because the marginal value increases diminish as the size of the property increases. In layman’s terms … Subject to a few assumptions, double the size of the house doesn’t mean double the value … what really happens is a doubling of the size gives only an approximately 40% to 65% uplift in value, but here comes the even more fascinating part … when it came to the rental figures, double the size of the house meant only 20% to 45% in increase in rent.

In a future article, I will be discussing the actual added value an extension can bring … but in the meantime, in an overall and sweeping statement, most of the time it makes sense to extend if you are going to live in the property as long as the extension is proportionate to the property, but if you are going to rent it out … possibly not.

Landlords Gas Safety Checks – New Legislation

Gas Safety Checks New Legislation effective from 6th April 2018; 

Landlord gas checks will now be allowed up to 2 months ahead of time from the 6th of April to start the process early and have a valid test certificate in place before the old one runs out without affecting the renewal dates. This is to prevent landlords and agents falling foul of the law when they experience difficulties in arranging access to a property for annual gas safety checks.

Failure to comply with the gas and other safety standards in rented properties render landlords open to heavy fines and or even prison if things go wrong. The new Gas Safety (Installation and Use) (Amendment) Regulations 2018 will ‘amend’ those in force since 1998. The Health & Safety Executive detail they are not aimed at reducing or relaxing safety standards, but to allow greater flexibility over when regular checks are being carried out.

Landlords and agents can’t force property access without a tenant’s cooperation, so through no fault of their own, they may be put in a position where they are breaking the law. The new system is designed to give landlords, agents and tenants more time to comply. Any transgressions though will now become less likely to be tolerated by the enforcement agencies, including local authorities and the Health & Safety Executive (HSE).

Gas Safe Register Tips on Gas Safety in Rental Property:

  1. All gas appliances in a rental property must be safety checked annually by a Gas Safe registered engineer. A tightness test of the pipework to ensure there are no gas leaks, and a visual inspection of accessible gas pipework should also be completed as part of the checks to ensure the installation is in good condition.
  2. Gas safe engineers must carry a valid ID card at all times. The front will confirm their registration and identity, the back will confirm they can do the gas work you’ve employed them to do.
  3. Be aware of the symptoms of carbon monoxide poisoning which include – headaches, dizziness, nausea, breathlessness, collapse. An audible carbon monoxide monitor must be located in any room with a solid fuel appliance, and a gas burning appliance.
  4. Be aware of signs that a gas appliance isn’t working properly– lazy yellow flames, excessive condensation and black marks/stains. However, gas appliances can be unsafe without displaying these symptoms.
  5. Gas appliances should only be used for their intended purposes only – i.e. cookers should not be used to heat a room.
  6. Provide enough ventilation for gas appliances to burn correctly, making sure no air vents or chimneys are blocked.
  7. Tenants must be provided with a copy of a current annual gas safety check certificate – at the start of their tenancy and updates

£567.53pm – The Profit made by every Peterborough Property Owner over the last 20 years

As we go headlong into 2018, I believe UK interest rates will stay low, even with the additional 0.25% increase that is expected in May or June. That rise will add just over £20 to the typical £160,000 tracker mortgage, although with 57.1% of all borrowers on fixed rates, it will probably go undetected by most buy-to-let landlords and homeowners. I forecast that we won’t see any more interest rate rises due to the fragile nature of the British economy and the Brexit challenge. Even though mortgages will remain inexpensive, with retail price inflation outstripping salary rises, it will still very much feel like a heavy weight to some Peterborough households. 

Now it’s certain the Peterborough housing market in 2017 was a little more subdued than 2016 and that will continue into 2018. Property ownership is a medium to long-term investment so looking at that long-term time frame; the average Peterborough homeowner who bought their property 20 years ago has seen its value rise by more than 243%.

This is important, as house prices are a national obsession and tied into the health of the UK economy as a whole. The majority of that historic gain in Peterborough property values has come from property market growth, although some of that will have been added by homeowners modernising, extending or developing their Peterborough home.

Taking a look at the different property types in Peterborough and the profit made by each type, it makes interesting reading..

However, I want to put aside all that historic growth and profit and looking forward to what will happen in the future. I want to look at the factors that could affect future Peterborough (and the Country’s) house price growth/profit; one important factor has to be the building of new homes both locally and in the country as a whole. This has picked up in 2017 with 217,350 homes coming on to the UK housing ladder in the last year (a 15% increase on the previous year’s figures of 189,690. However, Philip Hammond has set a target of 300,000 a year, so still plenty to go!

Another factor that will affect property prices is my prediction that the balance of power between Peterborough buy-to-let landlords and Peterborough first-time buyers should tip more towards the local first-time buyers in 2018.

The Council of Mortgage Lenders expects the number of buy to let mortgages to drop by 34% from levels seen in 2015. This is because of taxes being increased recently on buy-to-let and harder lending criteria for buy to let mortgages, which means I foresee a gradual move in the balance of power in favour of first-time buyers rather than buy-to-let landlords. First time buyers will also be helped by The Chancellor eradicating Stamp Duty for all properties up to £300,000 bought by first-time buyers in the recent budget.

This means Peterborough buy-to-let landlords will have to work smarter in the future to continue to make decent returns (profits) from their Peterborough buy-to-let investment. Even with the tempering of house price inflation in Peterborough in 2017, most Peterborough buy to let landlords (and homeowners) are still sitting on a copious amount of growth from previous years.

The question is, how do you, as a Peterborough buy to let landlord ensure that continues?

Since the 1990’s, making money from investing in buy-to-let property was as easy as falling off a log. Looking forward though, with all the changes in the tax regime and balance of power, making those similar levels of return in the future won’t be as easy. Over the last ten years, I have seen the role of the forward thinking letting agents evolve from a ‘rent collector’ and basic property management to a more holistic role, or as I call it, ‘landlord portfolio strategic leadership’. Thankfully, along with myself, there are a handful of letting agents in Peterborough whom I would consider exemplary at this landlord portfolio strategy where they can give you a balanced structured overview of your short, medium and long-term goals, in relation to your required return on investment, yield and capital growth requirements. If you would like such advice, speak with your current agent – or whether you are a landlord of ours or not – without any cost or commitment, feel free to drop me a line.

With Peterborough Annual Property Values 7.8% Higher, This is My 2018 Forecast

Looking at the newspapers between Christmas and New Year, it seemed that this year’s sport in the column inches was to predict the future of the British housing market. So to go along with that these are my thoughts on the Peterborough property market.

With the average 5-year fixed rate mortgage at 1.98% (down from 3.47% in 2014) and 2-year fixed rate at 1.47% (down from 2.37% in 2014), mortgage interest rates offered by lenders are at an all-time low (even with the slight increase on the Bank of England base rate a few months ago). Added to this, there has been a low unemployment rate of 4.9% in Peterborough, which has contributed to maintain a decent level demand for property in Peterborough in 2017 (interestingly – an impressive 3,452 Peterborough properties were sold in last 12 months), whilst finally, the number of properties for sale in the city has remained limited, thus providing support for Peterborough house prices, meaning …

Peterborough Property Values are 7.8% higher than a year ago

However, moving into 2018, there will be greater pressures on people’s incomes as inflation starts to eat into real wage packet growth, which will wield a snowballing strain on consumer confidence. Interestingly though, information from the website Rightmove suggested over a third of property it had on its books in October and November had their asking prices reduced, the highest percentage of asking price reductions in the same time frame, over five years. Still, a lot of that could have been house-sellers being overly optimistic with their initial pricing.

In terms of what will happen to Peterborough property values in the next 12 months, a lot will be contingent on the type of Brexit we have and the impact on the whole of the UK economy. A lot of people will talk about the Central London property market in the coming year, and if the banking and finance sectors are negatively affected with a poor Brexit deal, then the London market is likely to see more of an impact.

Nevertheless, the bottom line is Peterborough homeowners and Peterborough landlords should be aware of what happens in the roller-coaster housing market of Central London, but not panic if prices do drop suddenly there in 2018. Over the last 8 years, the Central London property market has been in a world of its own (Central London house prices have grown by 89.6% in those last 8 years, whilst in Peterborough, they have only risen by 38.3%). So we might see a heavy correction in the Capital, whilst more locally, something a little more subdued.

Hindsight is always better than foresight and predicting anything economic is all well and good when you know what is around the corner. At least we have the Brexit divorce settlement sorted and, as the UK economy and the UK housing market are intertwined, it all depends on how we deal as a Country with the Brexit issue. However, we have been through the global financial crisis reasonably intact … I am sure we can get through this together as well?

Oh, and house prices in Peterborough over the next 12 months? I believe they will end up between 0.2% lower and 1.2% higher, although it will probably be a bumpy ride to get to those sorts of figures.

 

My thoughts on the future of the Peterborough Buy-To-Let Market

I was recently reading a report by the Home website which suggested that hordes of landlords are selling their buy-to-let investments due to increasing burdens on them in the buy-to-let market. Their findings suggest the number of new properties that came onto the market nationally (for sale) jumped by 11% across the UK as a result.

Those increasing burdens include new tax rules coming in over the next 3 to 4 years and the announcement that all self-managing landlords (i.e. landlords that don’t use a letting agent to look after their buy-to-let property) will soon need to register with a compulsory redress scheme to resolve tenant arguments and disputes; as Westminster wants to heighten standards in the Private Rented Sector.

Interestingly I was chatting with a self-managed landlord from Glinton, when I was out socially over the festive period, who didn’t realise the other recent legislations that have hit the Private Rented sector, including the ‘Right to Rent’ regulations which came in to operation last year. Landlords have to certify their tenants have the legal right to live in the UK. This includes checking and taking copies of their tenant’s passport or visa before the tenancy is signed. Of course, if you use a letting agent to manage your property, they will usually sort this for you (as they will with the redress scheme when that is implemented).

If you are a self-managed landlord though, the consequences are severe because if you let a property to a tenant who is living in the UK illegally, you will be fined up to £3,000. That same Glinton landlord popped into my offices in the New Year, and I checked all his paperwork and ensured he was on the right side of the law going forward – and I offer the same to any landlord in the Peterborough area if you want me to cast my eye over your buy to let matters (and at no cost – ok just bring in some chocolates for the girls in the office!)

But what of all these extra properties being dumped onto the market in Peterborough? When I looked at the records the number of properties on the market in Peterborough now, as opposed to a year ago, the numbers tell an interesting story …


Overall, Peterborough doesn’t match the national trend, with the number of properties on the market actually remaining the same in the last year. Although, having said that it was particularly interesting to see the number of semis increase by 18% and the number of terraced on the market drop by 29%.

However, speaking with my team and other property professionals in the city, the majority of that movement in the number of properties and the types of properties on the market isn’t down to landlords dumping their properties on the market. The whole property market has changed in the last 12 months, with the majority of the change in the number and type of properties for sale due to the owner-occupier market, not landlords (a subject I will write about soon in my Peterborough Property Market blog later this Spring?). You see, for the last ten years, each month there has always been a small number of Peterborough landlords who have been releasing their monies from their Peterborough buy to let properties – as is the nature of all investments!

Nationally, the number of rental properties coming on to the market to rent fell by 16% in Q4 2017 compared to Q4 2016 .. but that isn’t because there are 16% less rental properties to rent – it’s because tenants are staying in their rental properties longer meaning less are coming on the market to be RE-LET.

Nevertheless, some Peterborough landlords will want to release the equity held in their Peterborough buy to let properties in 2018. All I suggest is that you speak with your letting agent first, as putting a rental property on the open market often spooks the tenants to hand in their notice days after you put it on the market (because they don’t like the uncertainty and also believe they will become homeless!). This means you have an empty property, costing you money with no rent coming in. However, some letting agents who specialise in portfolio management have select lists of landlords that will buy with sitting tenants in. If you have a portfolio in the Peterborough area and are considering selling some or all of them – drop me a line as I might have a portfolio landlord for you (with the peace of mind that you won’t have any rental voids).

Youngsters unable to buy their first home in Peterborough – Are the Baby Boomers and Landlords to Blame?

Talk to many Peterborough 20 something’s, where home ownership has looked but a vague dream, many of them have been vexatious towards the Baby Boomer generation and their pushover ‘easy go lucky’ walk through life; jealous of their free university education with grants, their eye watering property windfalls, their golden final salary pensions and their free bus passes.

If you had bought a property in Peterborough for say £15,000 in first quarter of 1977, today it would be worth £285,225, a windfall increase of 1801.5%.

But to blame the 60 and 70 year olds of Peterborough for that sort of rise seems a little unfair, with the value of the homes rising like rocket, I don’t believe they can be censured or made liable for that. A few weeks ago, I discussed in my blog the number of people in the Peterborough area who have two or more spare bedrooms (meaning they are under-occupying the house). I see many mature members of Peterborough society, rattling around in large 4/5 bed houses where the kids have flown the nest years ago … but should they be blamed?

We are all just human, and the mature members of UK society have just reacted to the inducements of our property and tax system. The mature generations who joined the property market party in the 1970’s and 1980’s were able to take out huge mortgages, protected in the knowledge that inflation would corrode the real value of the mortgage, while wage gains would boost their ability to repay.

Neither do I directly blame the multitude of Peterborough buy to let landlords, buying up their 10th or 11th property to add to their buy to let empire. They too, are humbly reacting to the peculiar historic inducements of the UK property market.

So, who is to blame?

Well, hyperinflation in the 1970’s meant the real value of people’s mortgages was whipped out (as mentioned above). Margaret Thatcher and Nigel Lawson are also good people to blame with Maggie selling off millions of council houses and Nigel Lawson’s delayed ending of the MIRAS tax relief in 1987; meaning he too can get his share of indignation. The Blair/Brown combo doubled stamp duty in 1997 and again in 2000, which, as a tax on property transactions, precludes a more efficient distribution of the current housing stock. The Government has had plenty of opportunity to change the draconian stamp duty rules to incentivise those mature Peterborough house movers to downsize.

However, I have started to see over the last few years a change in Government policy towards housing. The new breed of Peterborough buy to let landlords that have come about since the Millennium, have had their wings clipped over the last couple of years, with the introduction of new tax rules (meaning it is slightly more difficult to make money out of property unless you have all the national information and Peterborough property trends to hand).

It’s easy to think the only reason that hundreds of first time buyers have been priced out of the Peterborough housing market is because of these landlords. Yet, I believe landlords have been undervalued with the Peterborough homes they provide for Peterborough people. With first time buyers struggling to save for a deposit, if it weren’t for those landlords buying up those homes over the last 10/15 years, we would have a bigger housing crisis than we have today. Since the global financial crisis of 2008/9, local councils have had to cut services, so certainly didn’t have enough money to build new homes … homes that were provided to Peterborough by these buy to let landlords.

One side of the argument is that 871 homes are being bought up by buy to let landlords each year in the Peterborough City Council area when otherwise they might have become available to other buyers, the other side of the argument is the current national average deposit is £51,800, which is, by far, the greatest barrier to those wanting to buy their first home. Those homes bought by local buy to let landlords are not left idle, as they equate to 6,096 of new homes for local people, most of whom who see renting as a better option because of the choice, the simplicity and the flexibility which renting brings.

In the 60’s/70’/80’s, the traditional thoughts that you were a failure unless you owned your own home have now all but disappeared, because if you ask many young people, they would probably say renting was the perfect option for them at certain times of their life.

Peterborough Apartments are 14.2% more affordable than 10 years ago


My research shows that certain types of Peterborough property are more affordable today than before the 2007 credit crunch.

Roll the clock back to 2007 just before the credit crunch hit which saw Peterborough property values plummet like a lead balloon and the Peterborough property market had reached a peak with the prices for Peterborough property hitting the highest level they had ever reached. Between 2008 and 2010, Peterborough property values lay in the doldrums and only started to rise in 2011, albeit quite slowly to begin with.

Nevertheless, even though property values have now passed those 2007 peaks, my research indicates that Peterborough property, especially flats/apartments, are now more affordable than they were before the 2008 credit crunch.

Back in 2007, the average value of a Peterborough flat/apartment stood at £108,724 and today, it stands at £121,528, a rise of £12,804 or 11.8%.

However, between 2007 and today, we have experienced inflation (as measured by the Government’s Consumer Price Index) of 25.97% meaning that in real spending power terms Peterborough apartments are 14.2% more affordable than in 2007. Looking at it another way, if the average Peterborough apartment (valued at £108,724 in 2007) had risen by 25.97% inflation over those 10 years, today it would be worth £136,960 (instead of the current £121,528).

The point I’m trying to get across is that Peterborough property is more affordable than many people think. Peterborough first time buyers can get on the ladder as 95% mortgages have been readily available to first-time buyers since 2010.

It really comes down to a choice and if Peterborough first-time buyers can get over the hurdle of saving the 5% deposit for the mortgage on the property – they will be on to a winner, especially with these ultralow mortgage interest rates, a mortgage can be between 10% and 30% cheaper per month than the rental payments on the same house.

So why aren’t Peterborough 20 somethings buying their own home?

Back in the 1960’s and 1970’s, renting was considered the poor man’s choice in Peterborough (and the rest of the Country) a huge stigma was attached to renting. However, over the last 10 years as a country, we have done a complete U-turn in our attitude towards renting – meaning that many people find renting a better option and a lifestyle choice.

Saving the 5% deposit means going without many luxuries in life (such as holidays, every satellite movie and sports channel, socialising or the latest mobile phone – even if only in the short term) therefore instead of saving every last pound to put towards a mortgage deposit Peterborough 20 somethings choose to rent.

There is no denying the simple fact that over the next 10 to 15 years, the people who choose to rent instead of buy in Peterborough will continue to rise.

Therefore, everyone in Peterborough has a responsibility to ensure that an adequate number of quality Peterborough rental properties are safeguarded to meet those future demands. Interestingly, what I have noticed though over the last few years are the expectations of Peterborough tenants on the finish and specification of their Peterborough rental property.

I have perceived that in the past, what a tenant wanted from their Peterborough rental property was moderately unassuming because renting a property was only a short-term choice to fill the gap before jumping on the property ladder. Before the millennium, wood chip wall paper and twenty-year-old kitchen and bathroom suites were considered the norm.

However, Peterborough tenants’ expectations are becoming more discerning as each year goes by. I have also noticed the length of time a tenant remains in their Peterborough property is becoming longer (and this was backed up recently by stats from a Government Report), although I have noticed a tendency for many Peterborough landlords not to keep the rental payments at the going market rates – maybe a topic for a future article for my blog?

The bottom line is this … Peterborough landlords will need to be more conscious of tenants needs and wants and consider their financial planning for future enhancements to their Peterborough rental properties over the next five, ten and twenty years – e.g. decorating, kitchen and bathroom suites etc etc ..

The present-day and future situation of the Peterborough private rental property market is important, and I frequently liaise with Peterborough buy-to-let investors looking to spread their Peterborough rental-portfolios. I also enjoy meeting and working alongside Peterborough first time landlords, to ensure they can navigate through the minefield of rental voids, the important balance of capital growth and yield and ensuring the property is returned back to you in the future in the best possible condition.

Peterborough Property Market and Hammond’s Budget Promise to Build 300,000 more homes

I miss the good old days of George Osborne as Chancellor, with his hardhat and hi-vis jacket. He must have visited every new home building site in the UK with his trademark attire! For the last few years, the nearest Philip Hammond got to donning a ‘Bob the Builder’ outfit was at his grandchild’s birthday party. However, with what appears to be a change in focus by the Tories to ensure they get back in power in 2022, they appear to have fallen in love with house building again with the Chancellor’s promise to create 300,000 new households in a year.

Nationally, the number of new homes created has topped 217,344 in the last year, the highest since the financial crash of 2007/8. Looking closer to home: in total there were 1,201 ‘net additional dwellings’ in the last 12 months in the Peterborough City Council area, a meagre increase of just 10% on the 2010 figure.

The figures show that 66% of this additional housing was down to new build properties. In total, there were 791 new dwellings built over the last year in Peterborough. In addition, there were 407 additional dwellings created from converting commercial or office buildings into residential property and a further 5 dwellings were added as a result of converting houses into flats.

While these all added to the total housing stock in the Peterborough area, there were 2 demolitions to take into account.

I was encouraged to see some of the new households in the Peterborough area had come from a change of use. The planning laws were changed a few years back so that, in certain circumstances, owners of properties didn’t need planning permission to change office space in to residential use.

With the scarcity of building land available locally (or the builders being very slow to build on what they have, for fear of flooding the market), it was pleasing to see the number of developers that had reutilised vacant office space into residential homes in the local council area. Converting offices and shops to residential use will be vital in helping to solve the Peterborough housing crisis especially, as you can see on the graph, that the level of building has hardly been spectacular over the last seven years!

Now we have had the autumn budget, Theresa May and Philip Hammond have set out their stall with housing as their key focus. I was glad to see the Government introducing a variety of changes to improve housing, including more funding for the supply side and an injection of urgency into the planning system.

The biggest question is, just where are the Government going to build all these new houses? Maybe a topic for a future article?

Back to the main point though and the focus on the housing market by the Tory’s is good news for all homeowners and buy to let landlords, as it will encourage more fluidity in the market in the longer term, sharing the wealth and benefits of homeownership for all. However, in the short term, demand still outstrips supply for homes and that will mean continued upward pressures on rents for tenants.