SUMMER OR WINTER?? When should I market my property??

So, whilst sitting watching my new puppy chew his jammie dodger squeeky toy I find my mind wandering and thinking about what is happening in the market at present. We are now very much into the back end of the year, the nights are dark, the mornings are dark and the sun is hiding far more often than in previous months. And the question every morning now is: do I wear a vest under my shirt, jumper over my shirt, a coat or all 3!

But what does the winter bring the property market? Is it a myth that more properties are sold in the summer, than the winter? Well, here are some stats for you…

  • According to rightmove.co.uk Oct – Dec 2015 saw 150 properties sold in BH8 and Oct – Dec 2016 saw 128 properties sold in BH8.
  • According to rightmove.co.uk July – September 2015 saw 138 properties sold in BH8 and July – September 2016 saw 129 properties sold in BH8.

So as you can clearly see, in recent years, the time of year does not actually affect the number of properties sold in BH8. Specifically, in BH8 more properties have been sold in the winter of recent years, than in the summer months.

A stat that might be interesting to add to this, is how many properties are new to the market in that same time frame:

  • According to rightmove.co.uk in Oct – Dec 2015, for BH8, there were 190 new properties brought to market and 148 for Oct & November in 2016 (Dec 2017 stat not available)
  • According to rightmove.co.uk in July – September 2015, for BH8, there were 225 new properties brought to market and 273 for July -September 2016.

The interesting conclusion to take from this is that many more properties were new to market in the summer months but it is still a similar number of properties that are sold across the 2 times of year.But why would this be? Buyers buy for a number of reasons but mainly the reason revolves around a ‘want’, or a ‘need’. The ‘need’ buyers have little worry over what time of year it is, whether it is raining or bright sunshine, they have the need to move and move! When they move is much lower down on the list. Those who buy out of ‘want’, buy with their head and will be more reactive to the time of year, what the property looks like in the summer over the winter and will be looking for the deal. They have the option of being able to buy when something comes up, rather than having to buy what is there when they have to move.

In answer to the title question the stats above aren’t the only reason to make a decision on when to market. If there was, then this would suggest to bring your property to market in the Winter. But is that right for you, and your property? Does that fit in with your reason / need to sell? Who is likely to buy your property? Is your property then likely to be part of a chain? At what time of year does your buyer type buy?

There are a long, long list of reasons why a seller markets the property when they do. Be sure to know the questions and answers that will give you the right result.

There are many more interesting articles around the property market in Bournemouth, and surrounding areas, at www.propertyblogbournemouth.com and at www.gordonbarker.com. Please do check them out, I’d love to hear your thoughts on some of the talking points currently swimming around our industry.

 

 

BUY TO LET SALES | SHOULD YOU BUY WITH TENANT OR WITH VACANT POSSESION??

With the shift in tax, stamp duty and mortgage interest relief all changing at the moment landlords are moving property on as they may not be geared up right or they may have other avenues that fit their money circumstances better. But for new investor, who know and are geared up for the current rules are buying them and looking to buy more.

One question I am getting asked a lot at the moment because we have a number of these BTL sales on the market:

”Should we buy with a tenant in situ, or should they buy a property with vacant possession?”

To me, it seems a straight forward answer if you simplify it; If the property is tenanted, and you trust the agent currently managing it to tell you the truth about the management of the property, and the rent currently being paid is market rent then of course buy it with the tenants in situ. But only if they are good tenants.

Once you have established they are a good tenant, at this stage, it is about numbers. With all things equal you will make more money by buying a tenanted property because you are being paid from day 1. Costs going out are going to hurt less because you see money coming in instantly and you have no new / set up costs to pay the new managing agent as the tenant is already found and they should just continue as normal with whatever commission rate is agreed. And especially if they were the sales agency as they will want to keep you and the management of the property.

One extra thing to think about, if the property is already in a good condition and acceptable to the current tenant then there is little that will be required to be done to the property and the costs of this can be deferred to a later date when they vacate which gives you chance to build of the buffer for the works to be done.

When should you not buy it with tenants in situ? Well to me, this is where trust comes into play with the agent you are buying from. You need to find out who the tenants are, what rent are they paying, do they pay it every month, are the safety checks up to do, how long are they fixed in for, will they renew… these sorts of questions will help you to build trust with the agent but also to get the information you need to decide if the tenants are good or not and if they are likely to stay. You really don’t want to be inheriting bad tenants with the purchase.

If the property is already empty then it’s not a choice but given the choice, and if the ground work can be done to check the tenants of the property then every time, YES, buy with tenants in situ. Even pay a little more for that given there will be no immediate void, instant start of the return on the money, and tenants are already used to the property which should equate to easier management and less costs.

I am always happy to look over a possible option you’re thinking of buying so feel free to ask me – aaron@gordonbarker.

 

 

 

 

 

7 tips for Bournemouth Landlords

In my daily life running a sales and lettings agency I’m constantly asked about tips, tricks and things that clients should be looking out for. Well…while I’m sitting on hold with British Gas I’ve written out 7 things that should be considered before and during the lettings process


1 – Property presentation
When it comes to handing your property over to a agent / tenant for the first time be sure to give it over in the best condition possible and make sure an accurate inventory and schedule of condition is done. This way it helps to protect the condition of the property and slows any decline as it is starting higher, easier to see / deal with any damage and mush more chance of success with any deposit claim if there is evidence to suggest condition at start, and end, of a tenancy.


2 – Insurance
Be sure to have your property insured against the unforeseen. A standard landlord buildings insurance will do, but there are optional extras that include rent and eviction protection and accidental tenant damage (if higher than deposit taken) . These are useful items to have. Be sure to speak to your agent about this too. My agency has a rent guarantee policy, as most do, so make sure you are not doubling up but also make sure that any referencing done on the tenant will cover your protection policy too.


3 – Maintenance
Make sure you plan your maintenance as well as deal with reactive maintenance quickly and efficiently. Pick once, pick right and pay once. Be sure to use trusted contractors to fix problems to be sure they are not creating or finding further problems that don’t exist. Regular boiler servicing along with the Gas Safety Cert can uncover / fix problems before the cause serious concern.

 

4 – Paperwork
It is more important now, than ever, to be sure you have the correct paperwork in place from the very outset. From lodging and protecting the deposit to providing an EPC, from producing prescribed information to handing out the government made ‘how to rent’ booklet there are a large number of boxes that need to be ticked on move in. If these boxes are not ticked then it causes serious concerns on exit, if the tenant stop paying and you have not done what you should have then you cannot evict them until you have. Any notice, under section 21 especially, will be void if the boxes aren’t ticked at the start of the tenancy. Be sure you’re doing it right, from the start.

5 – Void periods
This is where Bournemouth landlords lose most of their money on their BTL investment. One month empty and that cold be your years profit gone, so be realistic on rents and keep good tenants in situ where you can. Is it worth losing a tenant, having an empty property for the sale of an extra £15 per month. On an £800pcm flat it will take 53 months (which is over 4 years) to get back a month’s lost rent at that increase!

6 – Suitability
There is a lot to be said for making sure a tenant is actually suitable for the property, and for you as owner. If you have a 1 bedroom flat with no garden or parking, then think carefully about letting to the couple with a child and a car.  Not only will the wear and tear be quite high on the flat, this will only ever be a short term fix for the couple. It will likely be empty again within 6-12 months, is that what you want? Also if you a particularly whiney neighbour then the family with a yappy dog, small children and pare works van and likely to cause you a lot of headaches during their tenancy with complaining neighbours, and likely through no fault of the tenant but again it will likely force them away and the property will be empty again soon. Think carefully about how suitable that tenant / applicant is for your property before letting them in?

7 – Service
And finally, what is it that you want your agent to do for you? And what can you do for yourself? Speak to them in detail about how their managed / tenant find services work for you and how they work with your ideals and ways of working. There needs to be synergy and compatibility with that you want. Otherwise you are just paying for something you don’t need or want and ultimately wont be happy with.

This is just an insight into what goes through an agents head on every let, this is what we do for a living and always offer the benefit of our experience for each and every landlord and tenant combo to get the best out of the scenario for all parties involved.

Read more articles: Why not read more articles from the Property Blog | Bournemouth by clicking this link..

Speak to me: If you’d like to speak to me about anything in this article, or anything property related please do drop me an email at aaron@gordonbarker.com. I’d love to hear from you.

 

Bournemouth BTL deal

If you are looking to start your BTL journey or you are a seasoned investor then here is a option for you to consider. I have been fortunate this week to have been instructed on a tenanted 1 bedroom first floor flat with ground floor entrance, own rear garden, freehold and converted loft room on top of the usual bedroom, lounge, kitchen and bathroom. See link below:

Sales

As it is currently tenanted it is a ready made investment. It currently rents at £650 pcm, with a scope for increase. Being located close to ensbury park it sits in a very central, and handy location offering great access to all local areas.

Having the freehold means no leasehold fees or concerns over lease length and no monthly or annual maintenance costs controlled by someone else.

At the current rent of £650 pcm it offers a return of over 5%. Couple that with what should hopefully be good capital growth and a rising rental market this looks a solid investment that should only go one way…

I am happy, as always, to chat through your personal requirements and thoughts surrounding BTL investment and what you are looking to achieve through any BTL purchase. Feel free to contact me anytime on aaron@gordonbarker.com