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There is no escaping the fact that over the last couple of decades, the rise in the number buy to let properties in Docklands has been nothing short of extraordinary.  Many in the “left leaning” press have spoken of a broken nation, the fact many youngsters are unable to buy their first home with the rise of a new cohort of younger renters, whom have been daubed ‘Generation Rent’ as landlords hoover up all the properties for their buy to let property empires. Government has been blamed in the past for giving landlords an unfair advantage with the tax system. It is also true many of my fellow professionals have done nothing to avail themselves in glory, with some suspect, if not on some rare occasions, downright dubious practices.
Yet has the denigration and unfair criticism of some Docklands landlords gone too far?
It was only a few weeks ago, I read an article in a newspaper of one landlord who had decided to sell their modest buy to let portfolio for a combination of reasons, one of which being the new tax rules on buy to let that were introduced last year. The comments section of the newspaper and the associated social media posts were pure hate, and certainly not deserved.
Like all aspects in life, there are always good (and bad) landlords, just like there are good (and bad) letting agents ... and so it should be said, there are good tenants and in equal measure bad tenants. Bad letting agents and bad landlords should be routed out … but not at the expense of the vast majority whom are good and decent.
But are the 4,914 Docklands (or E14 to be precise) portfolio buy to let landlords at fault?
The Tories allowed people to buy their own Council house in the 1980’s, taking them out of the collective pot of social rented houses for future generations to rent them. Landlords have been vilified by many, as it has been suggested by some they have an unhealthy and ravenous avarice to make cash and profit at the expense of poor renters, unable to buy their first home. Yet, looking beyond the headline grabbing press, this is in fact ‘fake news’. There are seven reasons that have created the perfect storm for private renting to explode in the 2000’s.
To start with, the Housing Acts of 1988 and 1996 gave buy to let landlords the right to remove tenants after six months, without the need for fault. The 1996 Act, and its changes, meant banks and building societies could start to lend on buy to let properties, knowing if the mortgage payments weren’t kept up to date, the property could be repossessed without the issue of sitting tenants being in the property for many years (even decades!) ... meaning in 1997, buy to let mortgages were born… and this, my blog reading friends, is where the problem started.
Secondly, in the early 2000’s, those same building societies and banks were relaxing their lending criteria, with self-certification (i.e. you did not need to prove your income), mortgages 8 times their annual salary, and very helpful interest only mortgage deals helped to keep repayments inexpensive.
Thirdly, the totally inadequate building of Council Houses (aka Local Authority Housing) in the last two decades and (so I’m not accused of Tory bashing) - can you believe Labour only built 6,510 Council Houses in the WHOLE OF THE UK between 1997 and 2010? Giving the Tories their due, they have built 20,840 Council Houses since they came to power in 2010 (although still woefully low when compared the number of Council Houses built in the 1960’s and 1970’s when we were building on average 142,000 Council Houses per year nationally). This meant people who would have normally rented from the Council, had no Council House to rent (because they had been bought), so they rented privately.
And then 3rd, 4th, 5th, 6th and 7th … 
·         Less of private home building (again look at the graph) over the last two decades.
·         A loss of conviction in personal pensions meaning people were looking for a better place to invest their savings for retirement.
·         Ultra-low interest rates for the last nine years since the Credit Crunch meaning borrowing was cheap.
·         A massive increase in EU migration from 2004, when we had eight Eastern European countries join the EU. That brought 1.4m people to the UK for work from those countries – and they needed somewhere to live.
Thus, we got the perfect storm conditions for an eruption in the Docklands Private Rented Sector.
Commercially speaking, purchasing a Docklands property has been undoubtedly the best thing anyone could have done with their hard-earned savings since 1998, where property values in Docklands have risen by 367.5%...
…and basing it on the average rental in Docklands, earned £462,024 in rent.
Yet, the younger generation have lost out, as they are now incapable to get on the property (especially in Central London).
The Government have over the last few years started to redress the imbalance, increasing taxes for landlords, together with the Banks being tighter on their lending criteria meaning the heady days of the Noughties are long gone for Docklands landlords. In the past 20 years, anything but everything made money in property and it was easy as falling off a log to make money in buy to let in Docklands – but not anymore.
Being a letting agent has evolved from being a glorified rent collector to a trusted advisor giving specific portfolio strategy planning on each landlord’s buy to let portfolios. I had a couple of instances recently of a couple of portfolio landlords, one from Belvedere who wanted income in retirement from his buy to let’s and the other from Welling, who wanted to pass on a decent chunk of cash to his grandchildren to enable them to buy their own home in 15/20 years’ time.
Both of these landlord’s portfolios were woefully going to miss the targets and expectations both landlords had with their portfolios, so over the last six/nine months, we have sold a few of their properties, refinanced and purchased other types of Docklands property to enable them to hit their future goals (because some properties in Docklands are better for income and some are better for capital growth) ... And that my blog reading friends is what  ‘portfolio strategy planning’ is! 

If you think you need ‘portfolio strategy planning’, whether you are a landlord of ours or not (because the Welling landlord wasn’t)  ... drop me line or give the office a call. Thank you for reading.

The number of residential property transactions in Tower Hamlets will be 37.5 per cent lower in 2018, compared to 2017.
According to my research, the seasonally adjusted statistics for our local authority area suggest with the number of properties already sold in 2018, and the number of properties currently under offer or sold subject to contract (allowing for property sales to fall through before exchange of contracts) we, as an area, will end the year 37.46 per cent lower compared to 2017.
So why are transaction numbers so important to Docklands homeowners, Docklands landlords and potential first-time buyers?
Many economists and property market commentators believe transaction numbers give a more precise and truthful indicator of the health of the property market than just house values. In the six years before the Credit Crunch in 2007/8, the average number of completed property transactions in the local area (the local authority covered by Tower Hamlets) stood at 4,940 per year .. yet in the three years following the Credit Crunch, on average, only 3,365 homes were changing hands per year in the area.
Roll the clock forward to more recent times and last year, in 2017, 3,542 homes changed hands (i.e. transacted and sold) in the area, not all that far off the local authority’s 23 year overall average of 4,199 homes per year.
 
In the past, a reduction in the number of properties selling has often been believed to be the first signal of a down turn in the housing market as a whole. Although, the down turn of the credit crunch years (2007/2008) was more a free-fall than a subtle down turn. Look at the graph and the ‘so-called’ halcyon days of the 2000 to 2006 property market were a roller coaster when it came to the number of transactions. House prices were rising in the six/seven years before the credit crunch (2000 to 2006), albeit, the rate of growth of Docklands house prices did slow in late 2005 and 2006 (which does fit in nicely with the graph).
In other articles, I have mentioned the change in the number of houses for sale today compared to last year and further back. Although, the market has seen in recent months (i.e. the short term) an increase in the number of properties for sale, fundamentally, in the medium term, there has been an underlying trend in the reduction of properties coming onto the market for sale in Docklands (and nationally) and this has been one of the main drives behind the lack of properties selling .. Docklands people aren’t moving as much as they were 30 years ago meaning fewer houses are selling each year.
However, this short-term increase in properties for sale hasn’t been even across the board. In certain sectors of the Docklands property market, there is a glut of properties on the market at the moment and so prices and values are dropping on those types as sellers compete for the limited amount of buyers… yet, there are other sectors of the Docklands property market where there is a dearth, a shortage of property, and buyers are fighting tooth and nail with silly offers to try and secure the sale. This means, there are some bargains for you Docklands buy to let landlords. If you look hard enough, you could spot the same trends I have seen in Docklands and find the individual property micro markets that fall into that first sector (with its glut).
So, if you want the inside track on the Docklands property market, whether you are a landlord of ours or another agent, I am more than happy to guide you in the right direction if you drop me a line or an email (contacts details are easily found on this page – and I don’t bite or do hard sell – promise!).
So, to conclude, I believe we will finish on 2,215 housing transactions by the end of the year in the area .. some way off last year’s figure and the long-term 23-year average. Looking at the short term future, now it’s true some (not all) but some potential purchasers of property in Docklands may be exhibiting more caution because of concerns that the Bank of England will continue to put up interest rates– to which I reply – yes of course they will when they are only ultra-low at 0.75%. Anyway, that is the reason why 90%+ of new mortgages over the last nine months have been on a fixed rate. Also, if they do go up a few percentage points – they are nothing compared to the 12%, 14%, even 15% mortgage rates many of my landlords saw in the early 1990’s.

We can all speculate (and I appreciate the irony of that as I write this article) but all I say to any Docklands landlords, Docklands homeowners or Docklands first time buyers is act according to your own life cycle, budget on a modest increase in interest rates in the coming few years (yet protect yourself by fixing it), consider your own circumstances and finally, what you can afford.
The combined value of Docklands’s housing market has fallen by £47,912,080 in the last 6 months, meaning the average value of a Docklands property has decreased in value by an average of £9,808.  
This is great news for Docklands first time buyers and Docklands buy to let landlords, as there is a slight hesitation in the market because of the uncertainty over Brexit. As I have always said, investing in Docklands property, be it for you to live in or as a buy to let investment, is a long-term game. In the grand scheme of things, this minor change over the last 5 or 10 years is nothing.
The RICS’s latest survey of its Chartered Surveyor members showed that nationally the number of properties actually selling has dropped for the 16th month in a row. Locally in Docklands, certain sectors of the market are matching that trend, yet others aren’t. It really depends which price band and type of property you are looking for, as to whether it’s a buyers or sellers market.
The RICS also said its member’s lettings data showed a lower number of rental properties coming on to the market. Anecdotal evidence suggests that (and this is born out in the recent English Housing Survey figures) Docklands tenants over the last few years are stopping in their rental properties longer, meaning less are coming onto the market for rent. I have noticed locally, that where the landlord has gone the extra mile in terms of decoration and standard of finish, this has certainly helped push rents up (although those properties where the landlord has been remiss with improvements and standard of finish are in fact seeing rents drop). Docklands tenants are getting pickier – but will pay top dollar for quality. So much so, I believe there will be a cumulative rise of around fourteen to sixteen per cent over the course of the next five years in private rents for the best properties on the market.
Back to the Docklands Property Values though …
This slight drop in Docklands property values doesn’t particularly concern me. The fact is that over the last 6 months 176 properties have sold for a combined value of £87,775,072. You see, that drop must be seen in perspective in that 6 months ago, the total value of Docklands property stood at £2,613,831,605 (£2.61bn), and today it stands at £2,565,919,525 (£2.57bn) .. this change is a drop in the ocean.
In the short term, say over the next six months and assuming nothing silly happens in Korea, the Middle East or Brexit negotiations, it will be more of the same until the end of the year. In the meantime, the on-going challenges ensuring we as a Country build more homes (although the Office of National Statistics figures released in July showed nationally the number of new homes started to be built over the second Quarter of 2018 had dropped dramatically) makes me think that Docklands (and Nationally) property value is likely to recommence an upward trajectory as we go into 2019.


One final thought for all the buy to let landlords in Docklands (and indirectly this does affect all you Docklands homeowners too). I do hope the recent tax changes towards buy to let landlords don’t bite as deep as it is possibly starting to with certain landlords I know.  We talked about this in an article a few weeks ago and I know why the Government wanted to change the balance by taxing landlords and providing a lift for first time buyers .. however, this may well come at the expense of higher rents for those Docklands tenants that don’t become first time buyers, as the appeal of buy to let potentially weakens.
Whether you are a Docklands landlord looking to liquidate your buy to let investment or a homeowner looking to sell your home, finding a buyer and selling your property can take an annoyingly long time. It is a step-by-step process that can take months and months. In fact, one of the worst parts of the house selling process is the not knowing how long you might be stuck at each step. At the moment, looking at every estate agent in Docklands, independent research shows it is taking on average 92 days from the property coming on the market for it to be sold subject to contract.
But trust me ... that is just the start of a long journey on the house selling/buying process. The journey is a long one and therefore, in this article, I want to take you through the standard itinerary for each step of the house selling procedure in Docklands.
Step 1 – Find a Buyer
You need to instruct an estate agent (of course we can help you with that) who will talk through a marketing strategy and pricing strategy to enable you to find a buyer that fits your circumstances. 92 days might be the average in Docklands, yet as I have said many times, the Docklands property market is like a fly’s eye, split up into lots of little micro markets.
Looking at that independent research, (which only focused on Docklands or E14 to be precise), it was interesting to see how the different price bands (i.e. different micro markets) are currently performing, when it comes down to the average number of days it takes to find a buyer for a property in Docklands.
Asking Price (Docklands)
Average Time to Find a Buyer in Docklands (days)
Under £100,000
11
£100,000 to £200,000
59
£200,000 to £300,000
207
£300,000 to £400,000
78
£400,000 to £500,000
133
£500,000 to £1,000,000
81
Over £1,000,000
114



Interestingly, I thought I would see which price band had the highest proportion of properties sold (stc)... again – fascinating!
So, now you have a buyer ... what next?
There are a variety of distinctive issues at play when selling your property in Docklands, together with the involvement of a wide and varied range of professionals who get involved in that process. That means there is are enormous differences in how long it takes from one property to another. Moving forward to the next steps, these are the average lengths of time it takes for each step to give you some idea of what to expect.
Step 2  - Sort Solicitors (and Mortgage)
Again, something we can point you in the right direction to, but it will take a good few weeks for your buyer to apply and sort their mortgage and for your solicitors to prepare the legal paper work to send to the buyer.
Step 3 – Legal Work and Survey
Once you buyer’s solicitor receives the paperwork from your solicitor, then your buyer’s solicitor applies for local searches from the local authority (to ensure no motorways etc., are going to be built in the back garden!).  These Searches can take a number of weeks to be returned to the buyer solicitors from the council, from which questions will be raised by the buyer’s solicitor to your solicitor (trust me – you don’t see a tenth of the work that goes on behind closed doors to get the sale through to completion). Meanwhile, the surveyor will check the property to ensure it is worth the money and structurally sound. Overall, this step can take between 3 and 6 weeks (sometimes more!).
Step 4 – Exchange of Contracts
Assuming all the mortgage, survey and legal work comes back ok, both the buyer and solicitor sign contracts, the solicitors then perform “Exchange of Contracts”. When contracts are exchanged, this is the first time both buyer and seller are tied in. Before then, they can walk away ... and you are probably 4 or 5 months down the line from having put up the for sale board – this isn’t a quick process! BUT hold on ... we aren’t there yet!
Step 5 – Completion
Between a week and up to six weeks after exchange of contracts, the buyer solicitor sends the purchase money to the seller’s solicitor, and once that arrives, the keys will be given to the buyer … phew!
To conclude, all in all, you are looking at a good four, five even six months from putting the for-sale board up to moving out.


If you are thinking of selling your Docklands home or if you are a Docklands landlord, hoping to sell your buy to let property (with tenants in), either way, if you want a chat to ensure you get a decent price with minimal fuss ... drop me a message or pick up the phone.




Living in our own homes or owning buy to let property in Docklands and the surrounding areas, it’s often easy to ignore the regional and national picture when it comes to property. As a homeowner or landlord in Docklands, consideration must be given to these markets, as directly and indirectly, they do have a bearing on us in Docklands. 

Locally, the value of property in Docklands and the number of people moving remain largely steady overall, although looking across at the different regions, there are certainly regional variations. Talking to fellow property professionals in the posh upmarket central London areas of Mayfair and Kensington, the number of people looking to buy and registering interest with agents is continuing to climb after 18 months in the doldrums, whilst in other parts of the UK, there is restraint amongst both buyers and sellers in some locations. 

The things that affect the national property market are the big economic numbers. Nationally, over the last few months, thankfully, the economic forecast and predictions have improved, notwithstanding the Brexit uncertainties. Inflation has mercifully throttled back its high growth seen in 2016 to the current level of 2.1% (from 2.7% average last year), coupled with marginally stronger wage growth at 2.5%. Unemployment is at a 42-year low at 4.2% and UK consumer spending power rose to an all-time high last month to £331.04bn – all positives for consumer sentiment. 

Look further afield, a resilient property market depends on the UK's economic health with the outside world, so if Sterling weakens, that makes imports more expensive, meaning inflation increases, and this matter I talked about a few weeks ago in my blog article ... interest rates could be raised to bring inflation under control, which in turn could seriously affect the property market. On the assumption Brexit negotiations are successful, economic growth should continue to be upward and positive, meaning confidence would be increased ... which is the vital element to a good housing market.

Looking closer to home now, Docklands landlords and Docklands homeowners might be interested in the how the regional and Docklands markets have performed over the last 20 years (compared to the National picture). Let’s look at the regional picture first, 

Tower Hamlets has outperformed the Greater London housing market by 2.83%...
...whilst nationally, Tower Hamlets has outperformed the country by 48.52%
That means a Docklands homeowner has profited by an additional £250,287 over the last 20 years compared to the average homeowners across the country.

I found it interesting to see the ups and downs of the Docklands, Greater London and National markets in this graph. How the lines of graphs roughly go in the same direction, with Docklands following the regional trend more closely than the national trend (as one would expect), how the 2007/08 property crash timings and effects were slightly different between the three lines and finally how the property markets performed in the post-crash years of 2011 to 2014 ... fascinating!


So, what does this all mean for Docklands homeowners and Docklands landlords?
Well, house prices going up or down are only an issue when you sell or buy. In the last 12 months, only 1,076,288 (let’s call it’s a straight million between friends!) properties changed hands out of 27.2 million households in the UK in 2017, meaning only 3.7% would have been affected if property values had dropped in the last year.
Property values in Docklands are 408.8% higher than the summer of 1998
Yet this has been a long-term gain. The number one lesson in property is that it is a long-term game.  The biggest issue in property isn’t house values or prices ... it’s the number of homes built, because the number of households nationally has only increased by 6% since 2007, whilst the population has grown by 7.6%. That doesn’t sound a lot, until you express it another way…
If the UK population had had only grown by the same percentage as the percentage growth in UK households in the last decade, there would be 1,000,000 less people living in the UK today

The final thought for this article is this, apart from central London, over the last 20 years it hasn’t mattered what part of the UK you were in with regards to the property market. Be you a landlord or homeowner, property is a long game, so look long term and you will win because until they start to build more homes, from the current levels of 180,000 new homes built per year to at least 250,000 households built per year, demand will, over the long term, outstrip supply for owning and renting!
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