Chichester Property News: May 2017

Monday, 29 May 2017

BUY-TO-LET DEAL OF THE WEEK: 2 bedroom flat in Chichester, £218,500, 4.7% yield

Summary:
2 bedroom flat in Chichester
Listed for sale on 20/03/17 @ £230,000
Now = £218,500

Rent = £850pcm
Yield = 4.7%

I spotted this week's buy-to-let deal of the week a couple of months back when it first came on the market for sale at £230,000. It caught my eye because I manage the (identical) apartment above. In fact, I've moved new tenants into it just this week! I therefore have a good grasp on the property, the block and the area and can confirm that it let very quickly due to its close proximity to St. Richard's Hospital, at £850pcm.

The two bedroom apartment has just been reduced to £218,500, meaning a gross yield of 4.7% is achievable (remember to factor in the flat's ground rent and service charges when comparing the return against a freehold property). It is a good size apartment, albeit the second bedroom is rather small, which limits the potential to house sharers. That's a shame as two double bedrooms would lend itself to this market very aptly, particularly as the master has it's own en-suite shower room so effectively each bedroom has a bathroom. Nevertheless, the rest of the apartment makes up for it as the master bedroom is a good size and the lounge/diner/kitchen all-in-one living space is perfect for young professionals.

The block is about 10 years old, so it maintains a modern feel and should mean you are able to move tenants in straight away without needing to do any major refurbishment work. Its location will mean you should always have a steady queue of tenants looking to rent what is a nicely presented and laid out apartment at a reasonable price for Chichester (where the average 2 bed flat costs £280,000).

It is on the market with King and Chasemore and full details can be found on Rightmove via the following link:
http://www.rightmove.co.uk/property-for-sale/property-47288337.html

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If you are looking for an agent that is well-established, professional and communicative in Chichester, then contact us to find out how we can get the best out of your investment property.

E-mail me on clive@crjlettings.co.uk or call 01243 624 599.

Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:

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c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP

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Thursday, 25 May 2017

What properties are for sale in Chichester?

So you’re thinking of buying a property in Chichester. What could you buy…well that depends on what’s for sale in Chichester; so let’s take a look.

Of course what you can buy is largely dependent on your budget. The cheapest property in Chichester costs just £16,000 - a two bedroom mobile home on Lakeside. The problem is it’s not a permanent residence. The cheapest fixed abode in Chichester, excluding retirement and shared ownership properties, will set you back £129,950. That will get you a very pretty, if rather compact (at just 298 square feet), studio apartment opposite Florence Park.

On the other end of the scale, the most expensive property for sale in Chichester today is a seven bedroom detached house in Pine Grove priced at £1.75m (5,131 square feet).

Clearly property in Chichester is expensive…some more so than others! Let’s assume your budget is somewhere in the middle of that. In fact, the median property for sale in Chichester costs £320,000, which is up from £310,000 compared to 12 months ago. For that you could choose from a large two bedroom garden flat in Summersdale, or from several two or three bedroom terraced homes closer to the city centre, depending on whether you prefer more space or a quieter location.

Delving a little deeper into the median price by property type provides a good indication of what your budget is likely to be able to afford in Chichester:

1 bedroom flat = £195,000

2 bedroom flat = £280,000

2 bedroom house = £305,000

3 bedroom house = £375,000

4 bedroom house = £499,950

5 bedroom house = £635,000

What was also interesting to see was how much (or how little!) choice there is for prospective property buyers in Chichester right now.

There are a total of 615 properties for sale, of which 344 are still available to buy and 271 are now sold ‘stc’ (subject to contract/completion). This is actually an improvement on the market a year ago, when just 321 homes were still available and 205 had sold, but it is still low for a city that houses 26,800 people.

Those looking for a three bedroom house have the most choice, with 108 available to buy in Chichester. It is the smaller homes, aimed at our first-time buyers, where supply is particularly lacking. There are actually more four bedroom houses available (52) than there are one bedroom flats (36 available) or two bedroom houses (48 available). Two bedroom flats, which are perhaps the most common of ‘first-time buys’, is only just a little easier to come by with 55 available.

It seems that supply remains tight in Chichester, which limits buyers choices, keeps house prices resilient, and makes finding that dream home just a little bit trickier.

(This article was featured in the Chichester Observer's property section on 25th May 2017)

Clive Janes, CRJ Lettings.

www.crjlettings.co.uk

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E-mail me on clive@crjlettings.co.uk or call 01243 624 599.

Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:

c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP

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Monday, 22 May 2017

BUY-TO-LET DEAL OF THE WEEK: 2 bedroom house in Fishbourne, £285,000, 4.1% yield

Summary:
2 bedroom semi-detached house in Fishbourne
Listed for sale on 08/05/17 @ £285,000
Rent = £975pcm
Yield = 4.1%

I visited the show home at Acorn Grove in Fishbourne to see how the development of 24 homes was going. Rather well it turns out, as they were all sold, except for the just released soon to be ex-show home and ex-sales office, which are both two bedroom semi-detached houses. Asking prices were due to be released imminently but it should be £285,000 for the ex-sales office and £295,000 for the ex-show home (which features some specification upgrades & furnishings).

That seemed pretty reasonable to me, considering a second-hand two bedroom house on the next door development (The Oaks) has just sold within a week of being marketed at £289,950. Considering you could get a brand new property, complete with warranty, for £5,000 less, that seemed worth investigating further. One snag is that there're unlikely to be available until November, as they are still being used for the marketing of Taylor Wimpey's Hambrook site, but that means you can lock in a purchase at today's price for six month's time (which could be a good or bad thing depending on how house prices develop I suppose).

They are obviously immaculately-presented houses, which will appeal to discerning tenants. They have a good layout, even managing to fit an en-suite into the master bedroom. The bedrooms aren't huge, but then that's true of most new-builds nowadays and something I think future generations will get used to and accept as 'normal'. The house overall is 673 square feet, which is quite a bit smaller than the recently sold one I mentioned (795 square feet but without an en-suite). It also forgoes a garage, again like most newer build plots (particularly two bedroom homes) but gets two allocated parking spaces, which is good.

Some people think buying new-build homes is a bad idea as you are overpaying to cover the developer's premium. Like a new car, as soon as someone uses it it is no longer new and thus loses some value. For many though, who want the assurances a new-build provides, it makes a very simple buy-to-let purchase whereby there is nothing to do and tenants can move-in from day one, safe in the knowledge that any maintenance issues for the next couple of years will be covered by the builder.

The fact it generates a decent yield in a popular area I often cite as being a great place to live, buy and invest in and I think it stacks up as a good buy-to-let prospect.

If that sounds like something worth paying a little extra for compared to some older homes, visit the sales office at Acorn Grove and take a look at what I think is a pleasant development in a great location, just on the outskirts of Chichester.

It is on the market with Taylor Wimpey and full details can be found on Rightmove via the following link: http://www.rightmove.co.uk/property-for-sale/property-48503070.html

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E-mail me on clive@crjlettings.co.uk or call 01243 624 599.

Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:

c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP

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Thursday, 18 May 2017

Will Chichester’s youngsters ever be able to afford their own home?

I was dropping off my latest Chichester Property News last week at LA Fish, on The Hornet in Chichester, when someone commented that they’d read my previous issue and found it to be quite depressing! They explained that they were born and bred in Chichester but could ill afford a family home in the area, what with the average four-bedroom house in Chichester costing nearly half a million pounds!

I sympathised and explained that Chichester had always been an expensive area but that because it had outperformed the UK average and other local areas over the past few decades, local property is indeed becoming ever more difficult to afford.

I did explain that IF they could get together the deposit plus the stamp duty and legal fees they’d need to buy, that due to record low interest rates the monthly mortgage cost might actually be more affordable than they expect.

The problem for Chichester’s wannabe first-time buyers is that Chichester’s higher than average house prices means getting this upfront sum of money together to purchase their own home is increasingly difficult.

A large proportion of Chichester property buyers are older; often relocating from London where Chichester’s house prices appear ‘cheap’ compared to the crazy prices of the London property market.

It is notable that nearly 1 in 4 people in Chichester are 65 or older, compared to a far lower 16% nationally. There are also 60% of Chichester’s 33,481 homeowners who don’t have a mortgage, whereas the national average in this privileged position is less than 49%.

A report by Knight Frank surveyed 3,500 private tenants nationwide. It highlighted the growing importance the private rental sector will have on the property market, as 24% of responders said they do not expect to ever buy their own home. Less than a quarter expect to leave the rental market within the next two years.

Interestingly, there is also a growing trend amongst some tenants who choose to rent rather than buy. One third of the tenants polled said that renting either suited their lifestyle or that they didn’t want the commitment of homeownership.

It is clear that many people no longer view the private rented sector as merely a short-term solution to their housing requirements. An increasingly mobile workforce is actively seeking the convenience of renting their home rather than committing to buy, whilst many more simply cannot afford to buy in Chichester.

The availability of good-quality rental property will therefore become increasingly important for the future of Chichester’s housing market. This continued demand from tenants is of course good news for Chichester landlords, many of whom are taking advantage of the current low interest-rate environment to expand their portfolios.

One important factor for a successful buy-to-let will be to ensure you purchase a property that will continue to appeal to the changing demographics and expectations of the developing rental market.

If you are thinking of getting into buy-to-let but don’t know where to start, feel free to contact me for some impartial advice and guidance to get the best return on your investment.

(This article was featured in the Chichester Observer's property section on 18th May 2017)

Clive Janes, CRJ Lettings.

www.crjlettings.co.uk

_________________________________

E-mail me on clive@crjlettings.co.uk or call 01243 624 599.

Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:

c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP

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Monday, 15 May 2017

BUY-TO-LET DEAL OF THE WEEK: 2 bedroom house in Chichester, £280,000, 4.1% yield

Summary:
2 bedroom house in Chichester
Listed for sale on 10/05/17 @ £280,000
Rent = £950pcm
Yield = 4.1%

This two bedroom house in Chichester, just behind St Richard's Hospital, is beautifully presented. It would make a very easy buy-to-let property as there is nothing that needs doing inside and it would rent well due to its location and presentation. I'd expect it to do so for around £950pcm, which would mean a 4.1% rental return based on paying the full asking price of £280,000.

And that is where this property falls down a little - the asking price. I've said for a while now that two bedroom houses in Chichester are in short supply and, as such, prices have been going through the roof. BUT similar properties on the street were selling for £225,000 a few years ago and I don't think a 24% price increase is quite justified. Even a three bedroom house with a garage in the street sold for a touch under £270,000 in 2013; so whilst the house is great, it does seem expensive compared to 'what could have been'. Then again, I've also said you need to look at the alternatives today and with money in the bank earning 1% at best, quadruple that return from a low maintenance house that has shown itself to present great opportunity for capital growth could still be a winner.

Due to its size it also offers the opportunity to turn it into a three bedroom house or even a four bedroom student house (taking a room from the lounge), which would undoubtedly increase that rental return.

It is on the market with Bell & Blake and full details can be found on Rightmove via the following link:
http://www.rightmove.co.uk/property-for-sale/property-66299600.html

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E-mail me on clive@crjlettings.co.uk or call 01243 624 599.

Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:

c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP

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Thursday, 11 May 2017

Which month is busiest for the estate agents in Chichester?

I was chatting with a landlord in Chichester last week who had decided to sell their rental property but was struggling to do so. He was therefore considering re-letting the property rather than holding out for a seller who might not come along, having waited several months already. I told him if he really wanted to sell, it might be best to remain patient a little while longer as April-May is typically a busy time amongst estate agents in regards to selling property.

When I got back to my office this got me thinking…which month is the busiest for the estate agents in Chichester? I thought if I looked up the number of property sales in Chichester in each month of last year, I might be able to find an answer.

Here’s the month-by-month total for 2016:

January - 166

February - 171

March - 274

April - 82

May - 107

June - 132

July - 139

August - 135

September - 154

October - 168

November - 142

December - 155

So March saw far more property sales in Chichester than in any other month in 2016. BUT this is something of a red herring, as 2016 was quite unique due to the government’s meddling. A 3% stamp duty levy that came in on 1^st April 2016 for landlords and second home owners, meant there was a huge increase in the number of transactions getting pushed through in March (and January & February) to avoid this additional cost.

Because of this, I thought it best to go back another year to 2015 (a year that wasn’t distorted by government policy), where I found the following number of property sales in Chichester for each month of the year:

January - 124

February - 144

March - 174

April - 139

May - 169

June - 246

July - 245

August - 213

September - 192

October - 204

November - 188

December - 206

We can see that the number of sales were far more evenly spread throughout 2015 than in 2016. The comparison between the two years also highlights what a drastic affect the stamp duty changes have had on Chichester’s property market, as every month after they came into force has seen fewer properties sold in Chichester than in the same month the year before.

Back to my original question though, about which month is busiest in Chichester’s property market, and it would seem the peak in property sales in 2015 occurred in June and July, where 246 and 245 properties were sold in Chichester respectively.

Bear in mind though that these figures (from Land Registry) are when a property sale is completed, rather than when it is first agreed between buyer and seller. With the legal process taking at least a couple of months, we can conclude that the majority of sales are indeed agreed in April and May.

Clive Janes, CRJ Lettings.

www.crjlettings.co.uk

_________________________________

E-mail me on clive@crjlettings.co.uk or call 01243 624 599.

Don't forget to visit the links below to view my previous buy-to-let deals and Chichester Property News articles:

c/o CRJ Lettings, 30B Southgate, Chichester, West Sussex, PO19 1DP

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