Clacton Vs Ipswich - Clash of the Property Market Titans

Many landlords have been asking me my thoughts on the Clacton property market recently, and in particular, what is happening to property values. My calculations show property values in Clacton quite interestingly grew in the month of September by 0.3%. When one looks at the annual growth, Clacton values are 7.7% higher (when comparing Sept 14 to Sept 15).  However, there are signs that the fundamental growth of property values in Clacton has now peaked, despite those average property values being above levels recorded in 2007 (just before the 2008 crash).

Even though prices are higher this month, this impressive rise of Clacton property values masks the underlying truth in what is really happening to local property values in the town. Throughout 2015, property values have been yo-yo like on a month by month basis, being quite volatile in nature.  For example:

• September 2015 - 0.3% rise
• August 2015 - 0.6% rise
• July 2015 - 1.1% rise
• June 2015 - 0.2% rise
• May 2015 - 0.9% rise
• April 2015 - 0.8% rise
• March 2015 - 0.8% rise

This is in part due to seasonal factors, as well as mortgage approvals increasing over June and July and then falling by over 15% in August, according to the Council of Mortgage Lenders (CML).

The outlook for the Clacton property market remains positive against the foundations of low mortgage rates and growing consumer confidence. However, I do have to question the recent CML mortgage data and whether that raises issues over whether the rate of growth since the Tory’s were re-elected in the early summer can continue? However, on a positive note, Clacton property values are still running ahead of salaries and average property values are 8.24% above the levels recorded in 2007.

Talking to fellow property professionals in the town, demand for property has been showing signs of moderating in the final few months of 2015, which in turn will lead to a slight slowdown in the pace of house price growth in the run up to the festive season. You see, it is really important not to read too much into one month’s (September’s) headline figures.

Readers might be interested to note that before the 2008 property crash, all the UK region’s housing markets tended to move up and down in tandem like the Clacton Synchronised Swimming team at the Clacton Leisure Centre Swimming Pool!  Since then though, the Greater London property market took off like a rocket in 2009/10, whilst the rest of the UK only really started to grow in 2012/13, and even then that growth was a lot more modest than the Capital’s.  Looking closer to home, it can even be different in neighbouring towns, areas and cities, so whilst Clacton property values are 7.7% higher than a year ago (as mentioned above), Ipswich’s property values are 5.5% higher than a year ago. (although, Southend’s are surprisingly higher at 9.5% higher!)

I cannot stress enough the importance of doing your homework.  One source of information and advice is the Clacton Property Blog where I have similar articles to this about the Clacton property market and what I consider to be the best buy to let deals around at any one time in the town, irrespective of which agent it is on the market with.  If you haven’t visited and you are interested in the local property market in Clacton….. you are missing out! 

Values of Clacton Terraced Houses smash through the £185/sqft barrier

The Council of Mortgage Lenders (CML) latest snapshot of the buy to let mortgage market shows us that buy to let landlords haven’t been put off by the Chancellors announcements on the way buy to let’s are taxed.

Last month, the CML stated £1.4billion was borrowed by UK landlords to purchase 10,500 buy to let properties, up 26.5% from the same month in 2014, when only 8,300 properties were bought with a buy to let mortgage. Go back two years and the number of buy to let mortgages used for purchasing (again not re-mortgaging) is 36.4% higher! Even more interesting has been the fact that the average amount borrowed has risen as well. The average buy to let mortgage last month was £133,330, up from £128,480 a year ago.

In Clacton, I am speaking to more and more landlords, be they seasoned professional landlords or FTL’s (first time landlords), as they read reports that the Clacton rental market is doing reasonably well, with rents and property values rising.  Interestingly, one landlord recently asked how much he should be paying per square foot (more of that in a second).

The first thing you have to decide is whether you want great capital growth or great rental yield, as every knowledgeable landlord knows, you can’t have both. Over the last twenty years, property values in Clacton have risen by 236.74%, compared to Greater London’s 436.2%. This has proved that capital growth increases faster in the more expensive South, but your investment money doesn’t go very far, meaning there won’t be as much rental yield from a 1 bed flat in Chelsea (2% per year at best with a fair wind) as a 2 bed semi in Clacton. However, whilst the figure of 236.74% is an average for the area, certain areas of Clacton have seen capital growth much higher than that and others areas much worse (we have talked about those in previous articles).

If you recall in an earlier article, my research reveals that Clacton apartments tend to generate a better yield than houses, probably because several sharers can afford to pay more than a single family. But houses tend to appreciate in value more rapidly and may well be easier to sell, simply because there are fewer being built.

So what should you be buying in Clacton, and more importantly, how much?

• The average apartments in the town are currently selling for approximately £165 per square foot
• Terraced houses in Clacton are currently obtaining, on average, £147,900 of £187 per square foot
• An average semi in Clacton is selling for £173,100 (and achieving £201 per square foot).

Now these are course averages, but it gives you a good place to start from. In the coming weeks, I will look at rents being achieved on Clacton houses and apartments, and the yields that can be obtained, depending how many bedrooms there are. 

Key Road - £129,995

Sheens have added this two bedroom end of terraced house located in Key Road for £129,995.

The property itself offers lounge, separate dining room, kitchen, two bedrooms and bathroom and offers neutral décor and carpets throughout, therefore ready to be let!!!

With similar properties achieving £625 - £650 PCM, this property offers a 6% yield!

Click here for more information and pictures!

http://www.rightmove.co.uk/property-for-sale/property-38536350.html

Pier Avenue Apartment with 8.25% return!

Blake and Thickbroom have listed this two bedroom first floor flat conveniently located within Clacton's town centre with the added benefit of Off Road Parking!

The property itself offers open plan lounge/kitchen (17'2 x 13'9), bathroom and two bedrooms with the master measuring 14'1 x 13'2. 

Two bedroom properties in this location achieve a monthly rental of £550, therefore based at £80,000 purchase price, this property would offer a healthy 8.25% yield return, before ground rent & service charges taken into account. 

For further pictures and details, click the following link!

http://www.rightmove.co.uk/property-for-sale/property-38560464.html

Clacton Buy to Let - Freehold House or Leasehold Flat?

Well my Clacton Property Blog reading friends, as seems to be all the rage with Jeremy Corben asking the PM questions emailed in to him at Prime Minster Question Times, I to wish to answer a question emailed into me from a potential Clacton landlord last week. Nice chap, lives in Holland-on-Sea, and it turns out, after having a coffee with him, he works in IT, has a spare bit of cash (now the kids have flown the nest) and wanted to buy his first buy to let property.

His main question was ... Do I buy a freehold house or a leasehold flat in Clacton?

Most people will say freehold every time, because you own the land. However, it’s not as simple as that (it never would be would it!). The definitive answer though is to research what Clacton tenants want in the area of Clacton they want! The tenant is ultimately your customer, and, if they don't want to rent what you decide is best to buy, then you are not going to have a successful BTL investment. So starting with the tenant in mind and working backwards from there, you won’t go far wrong. In a nutshell, find the demand before you think about creating the supply.

Leasehold flats and apartments in Clacton are excellent in some respects as they offer the landlord certain advantages, including the fact a flat can be initially cheaper to buy. Yields can be quite good, offering better cash flow. The building will already be insured and yes there is a service charge, but it’s still for a service at the end of the day and that cost is spread between many others (i.e. when your freehold house roof goes, its falls 100% on your shoulders) and one of my favourites is that there is often no garden to maintain or blown down fences to replace!

However, some Clacton leasehold flats can suffer from poor capital growth. Some leasehold properties have no cap on the level of the service charge and it may get out of control. The length of the lease will significantly affect value if not renewed before it gets too short. Thankfully there’s not many, but some Clacton apartments/flats have burdensome clauses. Finally, with leases, there can be sub-letting issues – which means you can’t let them out.

So what do the numbers look like? Well since 2003, the average freehold property in Clacton (detached, semis and terraced) has risen from £133,124 to £161,874, a rise of 22% whilst the average Clacton leasehold property (flats and apartments) has gone up in value from £87,997 to £98,162, a more mediocre rise of 12%. 

I was really interested to note that of the 9,210 rental properties in the Tendring District Council area that the Office of National Statistics believe are either let privately or through a letting agency, 3,847 of them (or 41.8%) are apartments. However, there are only 10,283 apartments in the whole council area (be they owned, council rented or privately rented), which represents 16.6% of the whole housing stock in the area. This really intrigued me that, quite obviously, there is a high proportion of Clacton’s leasehold apartments/flats rented to tenants compared to detached, semi’s or terraced. Fascinating don’t you think?

Every Clacton apartment block, every terraced house or semi is different. Like I said at the start, the definitive answer though is to research what Clacton tenants want in the area of Clacton they want. Demand for town centre apartments, near good transport links can be popular and can offer the Clacton landlord very good yields with minimal voids. However, Clacton terraced houses and semis, whilst not always offering the best yields (although sometimes they can), they do offer the Clacton landlord decent capital growth.

My advice to the prospective landlord as it is to you is do your homework.  One such website, which only talks about the Clacton buy to let Property Market, is the Clacton Property Blog. Another source of info many Clacton landlords use is me! What many Clacton landlords do, irrespective of whether you are a landlord of ours, a landlord with another agent or a DIY landlord, if you see any property in Clacton, that catches your eye as a potential buy to let property, be it a terraced house, semi or flat ... email me and I will email you back with my thoughts (although I will tell you what you need to hear .. not want to hear!)

11% return on Station Road, Clacton!

Offered with vacant possession, a chance to acquire this two bedroom first floor maisonette situated in the heart of Clacton's town centre, the seafront is within 200 yards and train station within a quarter of a mile for £60,000 with Scott Sheen & Partners.

The property does require some refurbishment, however Two bedroom properties located within town centre achieve a rental in the region of £525 - £550 PCM, therefore based at £60,000 this property offers an attractive return of 11%!!

For further information, click the following link.

http://www.rightmove.co.uk/property-for-sale/property-38515875.html

Town Centre Apartment with 9.4% return!

Bond Estates have added this two bedroom top floor apartment in Pallister Road for £70,000.

The property benefits from electric heating, separate W.C and double glazing but does require modernisation. The lease length is 999 years commencing from 15/04/1988 and with ground rent and service charges set at approx £300 a year, this property could make an ideal investment.

Two bedroom town centre apartments, generally speaking offer good size accommodation and will rent in the region of £525 - £550 PCM, therefore based at £70,000 this property offers a fantastic return of 9.4%.

See more details for this property here! http://www.rightmove.co.uk/property-for-sale/property-38472498.html

Great Clacton Apartment for £67,500

Scott Sheen and Partners have listed this one bedroom first floor flat situated in the popular area of Great Clacton, located within two hundred yards of local convenience store, and approximately two and half miles from Clacton's town centre, mainline railway station and seafront. 

One bedroom apartments are always in demand and properties in this area achieve a rental in the region of £475 PCM, therefore meaning a return of 8.4%, based on the full asking price of £67,500!

For further picture and information, click the following link here!

http://www.rightmove.co.uk/property-for-sale/property-30648243.html

Has Osborne killed buy to let in Clacton?

Well George Osborne, in his Autumn statement last week, caused Clacton landlords to ask whether buy to let is a viable investment option, when he announced that landlords, when buying another buy to let property from April 2016 will have to pay an additional 3% stamp duty on top of the standard rate. So for example, it means that the stamp duty bill for a £285,000 buy to let home will rise from the current £4,250 to £12,800 from April next year. 

Some say property in Clacton will be worth less because potential landlords will not be willing to pay as much for them, and if house builders or existing homeowners don't feel they are going to get as much for them , then there is less motivation to build / sell them?... and the person we can blame for this is George himself. Back in 2012, he choose to utilise the British housing market to kick start the UK economy, with  subsidies, Funding for Lending and Help to Buy. However, whilst that helped the Tory’s get back into power in 2015, some say this impressive growth in the UK property market has been at the expense of pricing out youngsters wanting to buy their first home.

Others say this is the straw that breaks the camel’s back as over the next four years Landlords will slowly lose the ability to offset all their mortgage interest against tax on rental income, after changes announced in the Summer Budget. At the moment, landlords can claim tax relief on buy to let mortgage monthly interest repayments at the top level of tax they pay (ie 40% or 45%). However, over the next four years this will be reduced slowly to the basic rate of tax – currently 20%.

Surely this is the end of Buy to Let in Clacton? Probably.. but before we all run to hills panicking .. let me give you another thought.

Stamp Duty rules were changed in December 2014. Before then, landlords were eagerly buying up properties under the ‘old slab style Stamp Duty’ system. For example, the stamp duty bill on that £285,000 property was lower on the old slab style duty (pre Dec 2014), at £8,550, yet it isn't a million miles away from new £12,800 stamp duty bill. Interestingly though, George has left a legal loophole in the new rules, because when it comes to selling up, they can offset purchase costs against any eventual capital gains tax, including stamp duty.

I believe that total returns from buy to let will continue to outpace other investments, such as the stock market, gilts, bonds and even pensions. Also, the best part about investing in property is that it is bricks and mortar. You can touch it, you can feel it, and it isn't controlled by some City whiz kid in Canary Wharf .. the British understand property and that goes a long way!

Buy to let has enough impetus behind it that prospective landlords will continue to buy even with a larger stamp duty bill. Clacton landlords will need to be savvy with what property they buy to ensure the extra stamp duty costs are mitigated.   Buying buy to let property is a long term venture. In the past, it didn't matter what property you bought in Clacton or at what price – you would always make money. Now with these extra taxes, the adage of ‘any old Clacton house will make money’ has gone out the window.   You wouldn't dream of investing in the stock market without at least looking in the newspapers or taking advice and opinion from others, so why wouldn't you take the same advice and opinion about buying a buy to let property in Clacton?

Homerton Close, Great Clacton

Front Estate Agents are delighted to offer for sale this two double bedroom house situated in a quiet cul-de-sac in the popular area of Great Clacton. 

The property has recently been redecorated throughout and has the additional benefit of a garage,off road parking and recently installed gas heating system.

Great Clacton is an extremely popular area, nestled on the outskirts of Clacton, but providing excellent access to the A133 for Clacton town centre & further beyond towards Colchester. 

We have recently let a similar property in the same street for £680 PCM, therefore based on the asking price of £134,995, this property offers an attractive 6% yield.

For more information, click the following link!

http://www.rightmove.co.uk/property-for-sale/property-52021792.html

A pair of Maisonettes in Wellesley Road

Revolution Estates have listed this pair of two bedroom maisonettes located on Wellesley Road for £190,000.

Both properties are currently tenanted and have the benefit of a new 99 year lease.

The agent has declared that these properties offer an approximate yield of 7%, therefore based on my calculations means that the monthly rentals are in the region of £550.

For further information, click the following link.

http://www.rightmove.co.uk/property-for-sale/property-38277975.html 

6% return on Three Bed Blenheim Gate

Bairstow Eves Clacton have listed this three bedroom end terraced house on Legerton Drive, Clacton, which is situated on the popular modern development of Blenheim Gate, Clacton for £175,000.

Built by Bloor Homes, the popular Blenheim Gate development is located to the outskirts of Clacton and has proven to be extremely popular for home owners and tenants alike.

We have recently let a similar three bedroom semi detached house in Lewis Road for £875 PCM, therefore based on purchase price of £175,000, this property would return 6% yield.

For further information, click the following link!

http://www.rightmove.co.uk/property-for-sale/property-35092281.html

Clacton Tenants pay 32.1% of their Salary in rent

I had the most interesting chat with a local Clacton landlord the other day about my thoughts on the Clacton property market. The subject of the affordability of renting in Clacton came up in conversation and how that would affect tenant demand. Everyone wants a roof over their head, and since the Second World War, owning one’s home has been an aspiration of many Brits.  However, with rents at record highs, many are struggling to save enough for a house deposit.

Let’s be honest, it’s easy to get stuck in a cycle of paying the rent and bills and not saving, but even saving just a small amount each month will sooner or later add up.  George Osborne announced such schemes as the upcoming Help to Buy ISA, where the Government will top up a first time buyers deposit.

Therefore, I thought I would do some research into the Clacton property market and share with you my findings.  Clacton tenants spend on average just over a third of their salary to have a roof over their head.  According to my latest monthly research, the average cost of renting a home in Clacton is £628 per month.  When the average annual salary of a Clacton worker stands at £23,479 per year, that means the average Clacton tenant is paying 32.1% of their salary in rent.  I doubt there is much left to save for a deposit towards a house after that, and that my Clacton Property Blog reading friends is such a shame for the youngsters of Clacton.

You see one the reasons for rents being so high is property prices being high.  As I have mentioned before, there is a severe lack of new properties being built in Clacton.  It’s the classic demand VS supply scenario, where demand has increased, but the number of houses being built hasn't increased at the same level.  Also, Clacton people aren't moving home as often as they did in the 80’s and 90’s, meaning there are fewer properties on the market to buy.  If you recall, a few weeks ago I said back in Autumn 2007, there were over 2,300 properties for sale in Clacton and since then this has steadily declined year on year, so now there are only 921 for sale in the town.

Back in Autumn 2007, there were over 2,300 properties for sale in Clacton and since then this has steadily declined year on year, so now there are only 921 for sale in the town. 

So, the planners in Clacton haven’t allowed enough properties to be built in the town and existing Clacton homeowners are not moving home as much as they used to, thus creating a double hit on the number of properties to buy.  This is a long term thing and the continuing diminishing supply of housing has been happening for a number of decades and there simply aren't enough properties in Clacton to match demand, these are the reasons houses prices in Clacton have remained quite buoyant, even though economically, over the last 5 years, it was one of the worst on record for the country and the East region as a whole.

However, things might not be all doom and gloom as originally thought, as a recent Halifax Survey  (their Generation Rent 2015 Survey) suggested  more and more people may be long term, if not lifelong tenants. In fact there is evidence in the report to suggest that the perception of how difficult it is to get on the housing ladder is vastly different between parents and people aged 20 to 45.  It seems from this survey that the state of the UK economy has shifted priorities quite significantly in quite a short space of time.  With fewer people able to save up the deposit required by mortgage lenders, more and more people are continuing to rent.  This delay in moving up the property ladder has driven rents across the UK up as more people were seeking rental properties .

It is often said that more people in central Europe rent for longer or never own their own property. The last two census in 2001 and 2011 show that proportionally the percentage of people who own their own home in Britain is slowly reducing and, as a country, we are becoming more and more like Germany.   That isn't a bad thing as Germany is considered to have a more successful economy, one of the main stays, often quoted,  is because they have a much more flexible and mobile workforce, (which renting certainly gives) and from that, they have a higher personal income than in the UK. 

     

Therefore, if we are turning into a more European model and the youngsters of Clacton and the Country have changed their attitudes, demand for rental properties will only and can only go from strength to strength, good news for Clacton tenants as wages will start to rise and good news for Clacton landlords, especially as property values in Clacton are now 8.2% higher than year ago!

Three Bedroom semi detached in Jameson Road

This three bedroom semi detached house has come to market with us in Jameson Road, Clacton on Sea. 

Located just off St Osyth Road, this property is conveniently located for local schooling and town centre. 

This property would achieve a rental figure of £800 PCM, therefore based on £160,000 purchase price, this property would return 6%.

For further information click the following link!

http://www.rightmove.co.uk/property-for-sale/property-52057444.html

Flatford Drive - 3 Bedroom semi detached House

John V Story are pleased to offer this THREE bedroom house situated within a popular residential area to the north-west of Clacton-On-Sea. The property is offered with NO-ONWARD CHAIN and boasts a large lounge/dining room, gas central heating, uPVC windows, downstairs cloakroom and driveway providing off road parking for two cars.

The property is situated on a popular residential development being conveniently placed for the local primary school, bus service and A133/A120 access. The property is located 1.6 miles away from Clacton-On-Sea town centre offering an array of family run business and also well known high street stores. The house is 1.5 miles away from the train station which offers links to London Liverpool street via Colchester.

Properties in this area rent in the region of £775 PCM, therefore based on £157,500 purchase price, this property would return 5.9%.

For further information, click the following link.

http://www.rightmove.co.uk/property-for-sale/property-38155947.html

How EU Migration has changed the Clacton Property Market

The argument of migration and what it does, or doesn't do, for the country’s economic well being is something that has been hotly contested over the last few years. In my article today, I want to talk about what it has done for the Clacton Property market.

Before we look at Clacton though, let us look at some interesting figures for the country as a whole. Between 2001 and 2011, 971,144 EU citizens came to the UK to live and of those, 171,164 of them (17.68%) have bought their own home. It might surprise people that only 5.07% of EU migrants managed to secure a council house. However, 676,091 (69.62%) of them went into the private rental sector.  This increase in population from the EU has, no doubt, added great stress to the UK housing market.

Looking at the figures, the housing market as a whole is undoubtedly affected by migration but it has been the private rented housing sector, especially in those areas where migrants come together, that is affected the most.  Indeed, I have seen that many EU migrants often compete for such housing not with UK tenants but with other EU migrants. In 2001, 3.68 million rented a property from a landlord in the UK.  Ten years later in 2011, whilst EU migration added an additional 676,091 people renting a property from a landlord, there were actually an additional 4.14 million people who became tenants and were not EU migrants, but predominately British!

As a landlord, it is really important to gauge the potential demand for your rental property, especially if you are a landlord who buys property in areas popular with the Eastern European EU migrants.  To gauge the level of EU migration (and thus demand), one of the best ways to calculate the growth of migrants is to calculate the number of people who ask for a National Insurance number (which EU members are able to obtain).

Interestingly, in Tendring, migration has fallen significantly over the last few years. For example, in 2006 there were 516 migrant National Insurance Cards (NIC) issued and the year after, in 2007, 533 NIC cards were issued. However, in 2014, this had slipped to only 367 NIC’s. However, if the pattern of other migrations since WW2 continues, over time there will be an increasing demand for owner occupied property, which may affect the market in certain areas of high migrant concentration. On the other hand, over time some households move into the larger housing market, reducing concentrations and pressures.

In essence, migration has affected the Clacton property market; it couldn’t fail to because of the additional 3,726 working age migrants that have moved into the Clacton area since 2005. However, it has not been the main influence on the market. Property values in Clacton today are only 22.37% higher than they were in 2005. According to the Office of National Statistics, rents for tenants in the East have only grown on average by 1.03% a year since 2005 .... I would say if it wasn’t for the migrants, we would be in a far worse position when it came to the Clacton property market. This was backed up by the then Home Secretary Theresa May back in 2012 - more than a third of all new housing demand in Britain is caused by inward migration and there is evidence that without the demand caused by such immigration, house prices would be 10% lower over a 20 year period.

If you want to know more about the Clacton property market, then for more articles like this, please visit the Clacton Property Blog www.clactonproperty.blogspot.co.uk

6% Return - Elm Grove, Clacton on Sea

This three bedroom semi detached house has been added this three bedroom semi detached house located in Great Clacton. The property is situated approximately a quarter of a mile from local shopping amenities, and is approximately one & a half mile from Clacton's town centre, mainline railway station and seafront.

Properties of this size and location generally achieve around £750 PCM, therefore based on the asking price of £150,000, this property would return a 6% yield!

For further pictures and information, click the following link.

http://www.rightmove.co.uk/property-for-sale/property-38044506.html

Two Bedroom Semi detached on Cambridge Road!

Peagrams Estate Agents have listed this two bedroom semi detached house located on Cambridge Road, Clacton for £129,995.

The current owners have completed a programme of improvements to include a new ground floor shower room, modern gas central heating system, and further benefits to include two reception rooms, a further modern first floor bath/shower room suite. 

Properties in this condition and area generally tend to achieve a monthly rental of £650, therefore would return 6%!

For further information, click the following link!

http://www.rightmove.co.uk/property-for-sale/property-38013588.html

Two Bedroom Maisonette in Melton Close, Clacton

Omega have listed this two bedroom maisonette situated on the outskirts of Clacton on Sea in Melton Close. 

The property benefits from modern fitted kitchen, gas central heating and private rear garden.

Properties of this size and location would rent for approximately £575 - £595 PCM, therefore based at the purchase price of £89,995, this property would return 7.9% (before ground rent and service charges taken into account).

For further information, please click the following link.

http://www.rightmove.co.uk/property-for-sale/property-55348253.html

Parklands Court - 6.5% return

Situated in 'Parklands Court' on the 'Grange Park' development is this immaculately presented two bedroom first floor maisonette being offered for sale with Sheens Estate Agents.

The property is located approximately one and a half miles from Clacton's town centre, mainline railway station and seafront. 

Parklands Court is popular block of 1 & 2 bedroom maisonettes and are extremely popular for rentals, offering good size living accommodation, communal gardens and parking this property wouldn't hang around on the lettings market for long and would achieve a monthly rental of £600 PCM.

Based on £600 PCM and purchase price of £110,000, this property would return 6.5%!

For more information and internal images, click the following link.

http://www.rightmove.co.uk/property-for-sale/property-37917114.html

Clacton Property Market Crisis as New House Building slumps by 45.95%

One of the key factors that determine the price of anything is the demand and supply of the item that is being bought and sold. When it comes to property, demand can change overnight, but it takes years and years to build new properties, thus increasing the supply.

The Conservatives have pledged to build over 1 million homes by 2020. I am of the opinion that as a country, irrespective of which party, we have not built enough homes for decades, and if the gap between the number of households forming and the number of new homes being built continues to grow, we are in danger of not being able to house our children or grand children. I believe the country is past the time for another grand statement of ambition by another Housing Minister. Surely it’s right to give normal Clacton families back the hope of a secure home, be that rented or owned? As a town, we need to exert pressure on our local MP Douglas Carswell, so they can make sure Westminster is held accountable, to ensure there is a comprehensive plan, with enough investment, that can actually get these homes built.

To give you an idea of the sorts of numbers we are talking about, in the Tendring District Council area in 2007 the number of properties built peaked at 370. In 2008 that figure had dropped but was still at 310 properties. By 2014, that figure had dropped by a massive 45.95% to 200 properties built.

The outcome of too few homes being built in Clacton means the working people of the town are being priced out of buying their first home and renters are not getting the quality they deserve for their money. The local authority isn’t building the estates they were after the war and housing associations are having their budgets tightened year on year, meaning they have less money to spend on building new properties. I know of many Clacton youngsters, who are living with their parents for longer because they cannot afford to get onto the housing ladder and growing families are unable to buy the bigger homes they need.

I talk to many Clacton business people and they tell me they need a flexible and mobile workforce, but the high cost of moving home and lack of decent and affordable housing are barriers to attracting and retaining employees. Furthermore, building new homes is a powerful source of growth, creating jobs across the county and supporting hundreds of Clacton businesses. It is true that landlords have taken up the mantle and over the last 15 years have bought a large number of properties. The Government need to be thankful to all those Clacton landlords, who own the 4,249 rental properties in the town. Most local landlords only have a handful of rented properties (to aid their retirement), and without them, I honestly don’t know who would house all the extra people in Clacton!

Moving forward, those Clacton landlords have many pitfalls, both in the short term and medium term. For instance, were you aware that the rules of changes for new tenancies from the 1^st October 2015 (with some imposing penalties including loosing the right to require the tenant to vacate, if they are done incorrectly) or in the medium term, the planned change in the way buy to let’s are taxed?

More than ever, the days of buying any old property in Clacton and you would be set for life are gone. Now, it’s all about ensuring you stay the right side of the law, buying the right property (and that might mean even selling some to buy others), so you build the right portfolio for you as a landlord. One source of info on all of these issues, where you will find other articles similar to this on the Clacton property market, is the Clacton Property Blog www.clactonproperty.blogspot.co.uk

Norman Close, St Osyth

Situated in a popular village location at the end of a cul-de-sac in St Osyth, Scott Sheen & Partners have added this extended three bedroom semi detached house. 

The agent has stated that this property does require some modernisation but has been reflected in the asking price.

Based on the property being offered in good order throughout, I would expect this property to achieve £850 PCM, therefore based on £165,000, this property would return 6.1%!

For further images and information, click the following link

http://www.rightmove.co.uk/property-for-sale/property-37839537.html

9.6% return on Carnarvon Road

An ideal investment, Haarts have listed this much improved apartment which has to be seen! Two bathrooms, separate lounge and kitchen, useful landing space and close to the town and beach!

Being marketed at £65,000 and with the potential to rent for £525 PCM, this apartment would return 9.6%!

For further information click the following link!

http://www.rightmove.co.uk/property-for-sale/property-45303139.html

East Clacton Apartment for £105,000!

Blake and Thickbroom have added this two bedroom first floor apartment, located in the sought after area of East Clacton.

An ideal location, this apartment is located across the road from the popular 'Holland Park Primary School', 

We are let similar properties in this area for £600 PCM, therefore based £105,000 purchase price this property would return 6.8%, before any charges taken into account.

For further information and images, click the following link:

http://www.rightmove.co.uk/property-for-sale/property-36969606.html

Two Bedroom Terraced House in Key Road, Clacton!

This two bedroom mid terraced house has come to market with Sheens of Clacton for £124,995.

The property is located approximately a quarter mile from Clacton's town centre, seafront and mainline railway station. 

Two bedroom properties in this area will achieve a rental in the region of £625 - £650 PCM, therefore would return 6.24%!

For more information and images, click the following link!

http://www.rightmove.co.uk/property-for-sale/property-52157998.html

Clacton House owners desert the housing market with an 8 year low

Even though the housing market is in an upbeat state in many parts of the UK, getting on the property ladder is still challenging for many and regarded as unattainable by some.  However, that goal has become even worse recently in Clacton as the number of houses available to buy is at an 8 year all time low.

Back in Autumn 2007, there were over 2,300 properties for sale in Clacton and since then this has steadily declined year on year, so now there are only 921 for sale in the town.  This continuing diminishing supply of housing has been happening over those years for a while and there simply aren’t enough properties in Clacton to match demand.

According to a recent report by the National Association of Estate Agents, that said, “There are now 11 house hunters fighting after every available house which isn’t sustainable.”   What that means is Clacton youngsters, who are looking to buy their first home, are finding themselves being squeezed out by the competition.  However, in the meantime, nobody wants to live with parents until they are in their 30’s, so that in turn creates demand for more rental properties, which means landlords have a greater demand for more rental properties so are buying more, resulting in even less smaller properties for the youngsters to buy, it’s a vicious circle.

   

Talking to fellow agents, mortgage arrangers, surveyors and solicitors in the town, all of whom have extensive dealings in the Clacton property market like myself, most of us agree the movement in the Clacton market is taking place in the middle to upper market, higher up the property ladder and it’s second and third steppers pushing through the properties that are being bought and sold.

That has meant as people tend to move less in the middle to upper market, the number of the properties actually selling has drastically reduced over the last couple of years.

When we look at the individual areas of the town, it paints an interesting picture.

• CO15 - Clacton-on-Sea 35 properties sold in May 2015 (with an average value of £168,591), whilst over the Summer months of 2014, the number of properties selling in this postcode reached into the early/mid 120’s.
• CO16 - Clacton-on-Sea, St Osyth, Little Clacton 42 properties sold in May 2015 (the most recent set of figures from the HM Land Registry), whilst over the Autumn months of 2014, the number of properties selling in this postcode was always between 58 and 61 per month. (Interestingly the average value of those properties was £205,618).

So what does this all mean for homeowners and landlords alike in Clacton?  Demand for Clacton property is good, especially at the lower end of the market.  However, with fewer properties coming up for sale, it means property prices are proving reasonably stable too.

You see I believe a more stable, consistent Clacton property market, with less people seeing property as an easy way to make a quick buck (as many did in the early 2000’s when prices were rising at nearly 20% a year so people were buying and selling every other minute), but a property market that has a steady growth of property values in Clacton, year on year, without the massive peaks and troughs we saw in the late 1980’s and mid/late 2000’s might just be the thing that the Clacton property market needs in the long term.

For more insights, comments and facts on the Clacton Property market please visit the Clacton Property Blog www.clactonproperty.blogspot.co.uk where you will find many similar articles to this.

Two Bedroom Apartment located on Coppins Road

Sheens Estate Agents have listed this two bedroom ground floor maisonette being offered with no onward chain in Coppins Road, Clacton for £89,995. 

In the valuers opinion the property could make an ideal First Time Buy or Buy to Let purchase. Clacton-on-Sea's town centre, seafront and mainline railway station are positioned approximately one and a quarter miles away.

This property would achieve a rental price of £575 PCM, therefore would return 7.6% return!

For further information and pictures, click the link below!

http://www.rightmove.co.uk/property-for-sale/property-52136509.html

Ruaton Gardens - Three Bedroom House!

This Three bedroom end terraced house located on the 'Ruaton Gardens' development has come to market with Sheens Estate Agents for £175,000. The property is conveniently situated within half a mile of Bockings Elm local shopping amenities, with Clacton's town centre, mainline railway station and sea front approximately one and quarter miles away. 

We have let a similar property on the 'Ruaton Gardens' development for £825 PCM, therefore based at a purchase price of say £170,000, this property returns 5.8%!

For further information and pictures, click the following link!

http://www.rightmove.co.uk/property-for-sale/property-37615197.html

6.2% return on Victory Road

Bairstow Eves have listed this three bedroom house located on Victory Road, Clacton for £150,000.

A fine example of a well presented characterful 1920 built property. This home benefits from 3 bedrooms, lounge with separate dining area, ground floor cloakroom and an enclosed rear garden.

I would expect this home to achieve £775 PCM, therefore at full asking price, this property returns 6.2%.

For further information, click the following link!

http://www.rightmove.co.uk/property-for-sale/property-35410845.html

Could your Clacton property save you from Pension oblivion?

If you were born in the early 1970’s or late 1960’s, if you haven’t started to think about it yet, retirement is closer than you think. In fact the number of years you have left to work is less than the number of years you have worked. The basic state pension is worth £115.95 a week for a single person in 2015/16 (or £6,029 a year) and £231.90 a week for a couple (£12,118 a year) as long as your partner has paid their stamp (although there are certain get of jail cards if they haven’t). 

As a household, could you live on just over £12k a year?

However, could the property you are living in in Clacton save you from poverty when you reach retirement? You see, a regular income is vital in retirement, and the bricks and mortar you own in Clacton could provide a way for you to finance life when you retire.

If you are in your 30’s, instead of saddling yourself with bigger and bigger mortgages, going from your first time buyer flat, to a terraced, to the semi and then the large detached house, you could instead keep your terraced or small semi, turning it into buy a buy to let property, let the rent pay the mortgage and then rely on capital growth to provide you with a lump sum when you sell the property and retire.  One of the biggest plus points of buy to let is what is known as leverage. Let me explain ... say you have a deposit of 25% and the value of the property rises by 3% a year, your gains in fact multiply to 12%.  However, if property prices drop, 'leverage' can be catastrophic, as losses will also be multiplied. Property values have dropped a number of times in the last 50 years, but they always seem to bounce back ... property must be seen as a long term investment.

Let me explain how leverage could work for you. If you had bought a Clacton house in Spring of 1983 for £25,000, using a 75% mortgage and 25% deposit, (meaning your deposit would be £6,250). Today, that Clacton property would have risen in value to £172,958, a rise of 591.8%. However, when you look at the growth on just your deposit, the rise is even better ... instead of 591.8%, we see a rise of 2667% (remembering that the mortgage would have been paid off).

However, buy to let is not all about capital growth and in retirement, income is more important than capital growth, as rent is the key to a steady income.

So surely the best strategy is to buy those Clacton properties with the high rents (when compared to the value of the property). These are called high yield properties in the buy to let world because the monthly return is so much greater. So surely they are the best in Clacton? Possibly, but the properties that offer these higher yields (in the order of 5% to 6% per year) tend to be in such areas as Regency Lodge or Swift Avenue in Clacton, historically they haven’t offered such good capital growth when compared to the town average, have a higher tendency for void periods and such properties tend to attract tenants that have a greater propensity to be high maintenance.

Therefore, if a high maintenance rental portfolio wasn't for you, another strategy could be buy a property with relatively smaller rental returns of 3% to 4% per year (i.e. lower yields), but in a more up market area such as Holland Road. Properties such as these tend to suffer from less void periods (i.e. when there is no tenant in the property paying you rent) and they historically have had better long term capital growth when compared to the town average.

Every landlord is different and every property is different. All I suggest to you is do your homework.

As regular readers will know, I am happy to share my knowledge and experience of the Clacton property market, high yields, high capital growth, what to buy, what not to buy and where to buy in the Clacton Property market can always be found on the Clacton Property Blog www.clactonproperty.blogspot.co.uk

Three bedroom semi on London Road!

This three bedroom semi detached house located on London Road has come to market with Castles of Clacton for £144,995. 

The property itself is well presented and within easy reach of town centre and amenities. The property boasts a modern well appointed kitchen, modern four piece bathroom, 50ft rear garden, gas central heating and double glazing.

I would expect this property to achieve £775 PCM, therefore based on £145,000 purchase price, this home would return 6.4%!

Click the following link for more information!

http://www.rightmove.co.uk/property-for-sale/property-37448247.html

6.4% return on Coppins Road

Castles of Clacton have listed this three bedroom semi detached house located on Coppins Road for £139,995.

The property is within easy walking distance of junior and senior schools and a local supermarket, news agent and post office is close by.

The Town Centre and main line railway station is under a mile from the property and road links to the A120 and A12 are a short drive away.

This area is a very popular rental area with average rents at between £700 & £750 pcm, therefore based on £750 PCM and a full asking price purchase, this home would return a 6.4% yield!

For further information and pictures, click the following link.

http://www.rightmove.co.uk/property-for-sale/property-48953593.html