Wednesday, 20 May 2015

What Does The General Election Result Mean For The Sunderland Property Market?

After the shock of the Conservatives returning to power with a majority at Westminster, all the potential issues and possible uncertainties of either a hung parliament or a Labour government with it's 'anti Landlord' policies, has lifted the cloud from the Sunderland property market

Talking to other Sunderland agents, surveyors and solicitors in the area over the last few days, there are signs this has started a new impetus the Sunderland property market after a subdued few months, when an amalgamation of tougher lending conditions and political uncertainty ahead of the General Election slowed demand

Against the back drop of Labour’s election promises of rent controls and three year tenancies, some Sunderland buy to let landlords were waiting to see how these new policies would be implemented before they committed themselves to buying more property for their portfolio

Now that uncertainty has been removed, the long term picture is very positive

So, where next for the Sunderland property market? 

With inflation at zero and with the Money Markets happy that David Cameron is still at No.10, the Bank of England have no reason to raise interest rates until 2016 at the earliest.

As mortgage rates are at their lowest levels since 2010, Landlords with larger deposits will now be wooed by the mortgage companies in the coming months with low rates

Some landlords might be nervous about the Tory’s plans for the housing market in the next five years affecting tenant demand for their rental properties

One plan is for Housing Association tenants to have the right to buy their property

These tenants were never in the private rented sector and will actually increase the supply of properties in the housing stock in decades to come 

The Government ‘Help to Buy Scheme’ has only helped to buy 1,124 Sunderland properties since the launch of the scheme in April 2013. Considering 5,542 properties have changed hands in this period alone in Sunderland, this represents a significant proportion of the Sunderland market but I don’t think it has made a huge difference to our local private rented sector

There are other policies which aren't as potentially harmful as the Labour plans but could still have a significant impact, such as the Deregulation Bill which bans 'revenge evictions' (this has already been through the Commons and the Lords and is due to come into force later this year)

Equally significant is the recent Conservative plan, slipped into the pre-election budget, which seeks to make it legal to allow tenants to sub-let 

If this sees the light of day it could be an absolute minefield but it's getting significant levels of understandable criticism from ARLA, The National Landlords Association etc and I'd suggest in the face of these objections I'd like to think it gets parked or quietly forgotten's not as if it was a major manifesto pledge 

The biggest matter, when it comes to tenant demand of rental property going forward, comes from the shift in the mindset and attitudes towards renting itself

Twenty years ago, in some quarters, you were seen as a second class citizen if you rented a property. Not any more! In Sunderland, as in the rest of the UK (apart from Central London), renting continues to offer good value for money for tenants

If you are an existing landlord in Sunderland (or are thinking of becoming one), then I must recommend you out seek specialist advice before making any decisions 

As I've mentioned many times before, I'll happy to make myself available to give you my thoughts on the current state of the Sunderland property market, the way it is likely to develop in the future, the advantages & disadvantages of investing in the Sunderland property market and what properties and areas you should be looking at - why not pop into our offices for a chat or give me a call on 0191 567 8577  

No comments:

Post a Comment