The ‘Liquorice Allsorts’ Northampton Property Market

Despite the UK economy heading in the right direction with record low mortgage rates and unemployment  figures dropping,  the rate of property prices rising in Northampton have tempered since the start of the year. This slow but sure downward trend in the rate of growth has been in evidence since mid-2014.  Property value increases continue to outpace the growth in salaries, however the gap is closing, helped by a lift in salaries over the last 6 months.  Property values in the East Midlands region as a whole are 2.9% higher than a year ago.  Compare this to the neighbouring regions of the East Anglia at 8.8% higher and South East at 9.1%, the majority of the country continue to see annual house price gains - the exception being Wales which recorded a slight  decline of - 0.6%.

Even with the tempering in house price inflation, it does not necessarily change my outlook that property prices are likely to be firmer over the second half of 2015 amid heightening activity in the Northampton property market.  As stated in a previous article, there is a current shortage of properties on the market, restricting supply, which in turn will provide stability and support to Northampton property prices. Therefore, my overall opinion is that Northampton property prices will rise by 6% over 2015 and roughly the same in 2016.

Property investment is a long term business.  Buying the right sort of property is vital. I have recently been speaking with a number of Northampton landlords about the importance of a balanced portfolio, when buying and renting out property. The balance between buying properties that offer good monthly returns (high yields) but quite often offer poor capital growth (i.e. they don't increase in value that much over the years compared with the average) verses properties that do go up in value quicker but often offer a lower yield.  So, what type of properties have performed best over the last few years in Northampton, especially in terms of their capital growth?

When comparing what the average price of detached, semi detached, terraced and flats were selling for back at the start of the Millennium to the present.  The results are quite remarkably different, almost like a bag of Liquorice Allsorts, as the different types of property have performed poles apart over the last 15 years:

•          Detached Houses in 2000 were selling on average for £148,360 and so far in 2015, they have been selling on average in Northampton for £322,440 a rise of 117%
•          Semi -Detached Houses in 2000 were selling on average for £74,685 and so far in 2015, they have been selling on average in Northampton for £179,257 a rise of 140%
•          Terraced Houses in 2000 were selling on average for £61,556 and so far in 2015, they have been selling on average in Northampton for £151,399 a rise of 146%
•          Flats and Apartments in 2000 were selling on average for £48,386 and so far in 2015, they have been selling on average in Northampton for £101,445 a rise of 110%

Moving forward, what should new and existing buy to let landlords do with this information?  Well, the questions I seem to be asked on an almost daily basis by landlords are:

·         “Should I sell my property in Northampton?”

·         “Is the time right to buy another buy to let property in Northampton and if not Northampton, where?”

·         “Are there any property bargains out there in Northampton to be had?”

Many other Northampton landlords, who are with both us and other  Northampton letting agents, like to pop in for a coffee,  pick up the phone or email us to  discuss the Northampton property market, how Northampton compares with its closest rivals (Milton Keynes, Wellingborough and Kettering), and hopefully answer the three questions above.  I don’t bite, I don’t do hard sell, I will just give you my honest and straight talking opinion and look forward to hearing from you.