How Affordability has Changed over the Previous Decade – Millenials Spend 3 x More then their Grandparents on Housing

Research by the Resolution Foundation think tank has found that young people are spending three times more on housing than their grandparents did.At the age of 30 millennials spend 23% of their annual income on housing costs, compared to those born 1926–1945 who, aged 30, spent just 7%.

The post war baby boomers now benefit from record levels of outright ownership, but there are now as many young families (aged 25–34) living in the private rented sector as owning a home or living in the social rented sector combined (36%).

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While the number of mortgage loans issued to first-time buyers over the past year is at its highest level since pre the financial crisis, the average age of a first time buyer looks set to continue to rise over the coming years.

It’s therefore cold comfort to those of us in the South-East that homes across more than half of the UK are more affordable now than before the financial crisis according to new research by the Yorkshire Building Society who analysed changes in local house prices and earnings since 2007.

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The gap between the least and most affordable parts of Britain has doubled over the last decade, with housing affordability having fallen across all of London’s 32 boroughs.

Homes in cities including Birmingham, Newcastle-upon-Tyne, Leeds, Harrogate, Edinburgh, Liverpool, Cardiff and Exeter are now more affordable than they were 10 years ago, while across Cambridge, Oxford, Bristol, Manchester, Nottingham and York property price rises have outstripped wage growth.

With the communities secretary announcing a new methodology for new build development based on household projections and affordability criteria, local authorities with high affordability ratios could be expected to build up to 40% more than their current targets. Perhaps the West Oxfordshire Local Plan will be examined further?

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5 Top Things to Consider BEFORE You Make Your Next Property Investment

1. LoMap_West_Oxoncation. Is it in an area of high tenant demand? Cheap does not necessarily provide you with the best return on your investment.
2. Target tenants. Consider who your ideal tenants will be BEFORE you purchase, and search accordingly.
3. Refurbishment. What work needs done to make the property attractive to your target market and how much will this cost?
4. Management. How will you find your ideal tenants and how will you ensure they will look after your property and that you are paid on time.
5. Exit strategy. Often overlooked, how long do you intend keeping the property for and what are the tax implications on disposal?

If you are considering your next investment purchase please give us a call. We can discuss your options and help you find, refurbish and manage your property to ensure you achieve the best return on your investment.

We happy to provide expert advice without commitment or ‘hard sell.’
Please call Brendan on 01993 708638 to find out more.

It’s Official – West Oxfordshire best in England!

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  • Research for BBC’s Radio 4’s Woman’s Hour has named the English local authority of West Oxfordshire as the best place to live in England if you are a woman.

Continue reading It’s Official – West Oxfordshire best in England!

How do schools affect house prices?

As the new school year gets underway, it seems timely to revisit the well-oiled notion that schools are an instrumental driver of local house prices.

If a property is located within a popular local school catchment, this is often one of the first attributes to be included on agents’ sales particulars, even before how many bedrooms the property has. But, how much more are home buyers prepared to pay to live close to an outstanding school? What impact does that Ofsted rating really have on local house prices?

Our analysis uses Land Registry data for property sales completed in 2016 and 2017 (to present), which totals over 860,000 transactions. Meanwhile, the DfE secondary school database has been cross referenced with Ofsted which totals over 3,200 schools. Average house prices have been calculated for bandings of 1, 2, 3, 4, and 5 miles from each school dependent on whether or not the latest Ofsted report for the school was graded outstanding. On this occasion, we have excluded London from this analysis since the closer proximity of schools together means that the distance bandings tend to overlap and affect the analysis.

The results of our analysis reveal that there is a definite price premium associated to homes close to outstanding schools. Properties located within one mile of an outstanding secondary school since the beginning of 2016 have sold for, on average, 20% more than properties within one mile of other schools across England, excluding London. This equates to an average premium of almost £47,000.

We have broken the analysis down by property type and the highest premiums paid to live closest to outstanding schools are for detached houses. Since the beginning of 2016, buyers have paid, on average, 28% more to live in a detached house within one mile of an outstanding school compared to within one mile of a non-outstanding school. This means buyers have had to find an extra £88,000.

Overall, the price premium drops off after one mile except for detached and semi-detached houses. Buyers of these homes are still prepared to pay a premium to live within one to two miles of an outstanding school. For detached homes this equates to 10% or an additional £35,000 and for semi-detached homes the premium is 7% or just under £14,000.

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Buyers in the East of England pay the highest premiums overall for living close to outstanding schools. Since the beginning of 2016, properties within one mile of an outstanding school have sold, on average, for 46% more than those within one mile of other schools, a price premium of almost £117,000.

So, with applications for next year’s students set to close before Christmas, home owners living close to an outstanding school but whose children have flown the nest may find it a lucrative time to sell.

Witney has one outstanding primary school – The Batt CofE Primary School although we’re blessed with a plethora ofn ‘good’ rated primary schools. Ar secondary level, the nearest outstanding school is Bartholemew in Eynsham although bith Henry Box and Wood Green are ‘good.’