Friday, 30 December 2016

Falmouth Property Market in 2017 and Beyond


 
 




Just like the leaves on the trees, Christmas has gone and the New Year is virtually upon us. Speak to any local agent and they will tell you the Falmouth property market has a confident feel to it. With the underlying fundamentals of a continued lack of properties being built, a shortage of properties (both in terms of quantity and quality) coming to the market and the continued low mortgage rate environment, the motivation of buyers in general is strong.

 

There are a few potential hurdles coming towards us in the coming months that could affect the Falmouth (and UK) property market. Mrs. May has yet to get her teeth into Brexit negotiations and the jury is still out in respect of the knock-on effect ‘across the pond’ of Donald Trump as the choice of next US President. It has often been said that the US sneezes and we catch a cold…. the questions on everyone’s lips is… is it a cold we are in for or something far worse? Do we need to batten down the hatches or will a flu jab do?

 

Property ownership, whether it’s for yourself as a homeowner or buy to let landlord, is a long-term investment. In fact, focusing on buy to let, a number of landlords who own property in Falmouth have made contact with us recently asking for our thoughts on the future of the buy to let market in Falmouth.  Well, as the Politician Edmund Burke said in the 18th century, "Those who don't know history are destined to repeat it." .. . it is a wise man who delves into the past to get a glimpse of the future.

 

Since the Millennium, the housing market has had everything thrown at it. The recent Brexit, last year’s General Election, the near melt down of the World Economy with the Credit Crunch, The Dot Com boom and bust, the housing market crisis in 2008, the housing boom of 2001 to 2004 ... the list goes on. Here is a graph (courtesy of the Land Registry) of average Property values since the Millennium in the Cornwall.
 

 
 
 
 

 



Even though we had the Dot Com bubble burst in 2000, two years later in January 2002, property values in the Cornwall had risen from £69,500 (in Jan 2000) to £96,900 ... and kept rising to November 2007, when they peaked at £217,000. Then we had the Credit Crunch and property prices continued to fall until February 2009, where they averaged £179,800 ... but look where they are now…  £210,900!

 

The point I am trying to get across is long term future property values are more helpful to landlord investors than the month by month headline grabbing micro movements in the property market.  Look at the graph and you will see the growth in property values is an upward trend BUT, the average darts about as each month goes by.  So don’t watch the property indexes and panic if values drop next month or the month afterwards, because even in the glory days of 2001 to 2004 and 2012 to 2014, without fail, values always dropped slightly around Christmas, but people will always need a roof over their heads, and if they can’t buy and the council aren’t building anymore  … only buy to let landlords can meet that demand. That’s you folk that read this.

 

Falmouth landlords are being hit in the pocket with the new up and coming taxation rules and yes we might have a bumpy ride on the run up to Christmas (because of the points raised earlier), Brexit or no Brexit, but the trend will be a slow and steady upward momentum of property values, demand for rental properties and yields in the Falmouth property market into 2017 and beyond.

 
 

 
 

1 comment:

  1. Thanks for sharing this blog.
    Scarph & Spirit offer a complete design service. We strive to find the right solution for each client, from the most simple re jig of that awkward area, through to the boldest architectural changes to your property.Falmouth builders

    ReplyDelete