Friday, 24 June 2016

What BREXIT Means For The Wrexham Property Market? ..

59% of Wrexham Voters voted to leave the EU – What now for the 1000 Wrexham Landlords and 35,000 Wrexham Homeowners?

It’s 5.50am as I start to type this article and David Dimbleby has just announced the UK will be leaving the EU as the final votes are counted. As most of the polls suggested a Remain Vote, it came as a surprise to most people, including the City. The Pound has dropped 6% this morning after the City Whiz kids got their predictions wrong and MP’s from the Remain camp are using words like “challenging times ahead”.

.. and now the vote has been made .. what next for the 35,000 Wrexham homeowners especially the 19,358 of those Wrexham homeowners with a mortgage?

The Chancellor in the campaign suggested property prices would drop by 18%. Using Treasury estimates, their method of calculating this was tenuous at best, but focused around the abrupt and hasty increase in UK interest rates, which in turn would raise the cost of mortgages, and therefore lower demand for property, causing a drop in property prices.… and I would say, yes .. that will probably happen.

Wrexham  Property Values

Wrexham property values will probably drop in the coming 12 to 18 months – but by 18% - I am sorry I find that a little pessimistic and believe that figure was rhetoric to get homeowners and landlords to vote in a particular way. But the UK property market is quite a monster.

Since the last In/Out EU Referendum in June 1975,
property values in Wrexham  have risen by 1620%

(That isn’t a typo) and whilst property prices did drop nationally by 18.7% between the peak of 2007 and bottom of the market in 2009, when one compares property values today in the country, compared to that all-time high of 2007, (the period before the financial crisis of the Credit Crunch of 2008/9) .. they are still up 10.14% higher.

Another Credit Crunch?

And so, notwithstanding the Credit Crunch, the worst global economic outlook since the 1930s and the recession it brought us, a matter of a few years later, the Government were panicking in 2012/3/4 that the housing market was a runaway train.

Now the same Credit Crunch doom-mongers and Sooth-Sayers that predicted soup kitchens in 2008/9 are predicting Brexit meltdown. Bad news sells newspapers. Stock markets may rise, stock markets may fall, yet the British public continued to buy property in 2009/10 and beyond. Aspiring first time buyers and buy to let landlords dusted themselves down, took a deep breath and carried on buying… because us Brit’s love our Bricks and Mortar .. we need a roof over our head.

However, as mentioned previously, if the value of the pound drops, in the past UK Interest Rates have risen to reverse that drop. However, whilst a cheaper pound will make your pint of Sangria a little more expensive on your Spanish holiday this year and make your brand new BMW pricer .. it will make British export cheaper! Which is great for the economy.

Interest rates

… and what of interest rates? Since 2009, interest rates have been at 0.5% and lots of people have become accustomed to those sorts of levels. So what if interest rates rise .. end of the world? Interest rates in the 1986/88 property boom were on average 9.25%, the 1990’s they were on average around 6.5% and uber-boom years (when UK property values were rising by 20% a year for three or four straight years across the UK) .. 4.5%. Many of you reading this who are in their 50’s and older will remember interest rates at 15%.

But I suspect interest rates won’t rise that much anyway, as Mark Carney (Chief of the Bank Of England) knows, raising interest rates causes deflation – which is the last thing the British economy needs at the moment. In fact they have been printing money (aka Quantitative Easing) for the last few years (which causes inflation) to the tune of £375bn a month. A bit of inflation because the pound has slipped on the money markets (not too much mind you) might be a good thing?

.. because whilst property values might drop in the country, they will bounce back. It’s only a paper loss.. because it only becomes real if you sell. And if you have to sell, again as most people move up market when they sell, whilst your property might have dropped by 5% or 10%, the one you want to buy would have dropped by the same 5% to 10% .. and here is the best part – (and work your sums out) you would actually be better off because the more expensive property you would be purchasing would have come down in value (in actual pound notes) than the one you are selling.

The Wrexham  landlords of the 7000 Wrexham  buy to let properties have nothing to fear neither, nor do the 15,000 tenants living in their properties.

Buy to let is a long term investment. I think there might even be some buy to let bargains in the coming months as some people, irrespective of evidence, panic.  Even if we pull up the drawbridge at Dover and immigration stopped today, the British population will still increase at a rate that will exceed the current property building level. Britain is building 139,600 properties a year, but needs according to the eminent ‘Barker Review of Housing Supply Report’, the country needs to build about 250,000 properties a year to even stand still, and as the the birth rate is increasing, the population is living longer and just under a quarter of all UK households now are occupied by a single person demand is only going up whilst supply is stifled. Greater demand than supply equals higher prices. That is definitely a fact.

So, what will happen next?

Well, there are many challenges ahead. The country has spoken and we are now in unchartered territory – but we have been through a couple of World Wars, an Oil Crisis, Black Monday, Black Wednesday, 15% interest rates and a Credit Crunch … and we survived!

And the value of your Wrexham  property? It might have a short term wobble… but in the long term -it’s safe as houses regardless.

If you have any questions, about what brexit means for your property rental or property sale, call Craig Swire - your local property specialist - 01978 799 588 / 0787 237 6768

Tuesday, 7 June 2016

Rent Smart Wales, What Every Wrexham Landlord Needs To Know !

Wrexham Landlords Face Huge Fines and Penalties For Not Registering Their Rental Properties

'’What is Rent Smart Wales’’ and ‘’how does it affect me?’’ Landlords across North Wales have been calling me over the last few weeks to find out about this new law and to ask ‘’what do I need to do?’’. There’s no two ways about it, Rent Smart Wales [RSW] is coming and there will be penalties for those Landlords who;
* Do not register themselves as Landlords
* Do not get licensed OR do not employ a Licensed Letting Agent

The Consequences For Not Registering And Arranging The Licensing For Your Wrexham Buy-To-Let Property

  • Being declared as NOT fit & proper
  • You will not be allowed to manage your own rental property
  • Revocation of registration for providing false or misleading information
  • A fine which has yet to be determined

Rent Smart Wales in Wrexham.. what YOU NEED to know !

As part of the new rules landlords must register themselves and declare ownership of any properties they partly, jointly or solely own. The administration for the licensing has been granted to Cardiff Council, and there is a four stage process to licensing;
Step 1 – Complete an on-line [£33.50] or paper [£80.50] registration form; to declare ownership of any properties that you own
Step 2 – Employ a licensed letting agent OR book onto a training course [from £20 on-line or £100 to attend a day course]
Step 3 – If you have employed a licensed letting agent you can now take a step back OR you must now complete a Landlord OR Agent license application form & pay the appropriate fee [A landlord license is £144 if bought on-line or £186 if done on paper]
Step 4 – Sit back & let your agent take over OR receive a 5-year license to manage your rental properties.
A license is required if a landlord does ANY of the following things themselves:
  • Arranging or conducting viewings with prospective tenants
  • Referencing prospective tenants
  • Preparing or overseeing the arrangement of the tenancy agreement
  • Preparing, or arranging the inventory or schedule of condition
  • Collect / receive rent
  • Are the principal point of contact with the tenant
  • Make arrangements with a person to carry out repairs
  • Check the contents or condition of a property, as part of a current tenancy or one which has ended
  • Serve notice to terminate a tenancy

Wrexham Landlords Still Have Time To Act

There is still a little bit of time to act as the date for becoming licensed is set at 23rd November 2016 however, beware that the process can take up to 6 weeks depending on where you complete your training.
Steps you can take to comply with the new rules:
1 – Read all about the new RSW rules here:
2 – Complete your initial landlord registration ASAP
3 – Employ a licensed Letting Agent, they will be able to guide you through the process and ensure you are up and running before the deadline
To find your local Rent Smart Wales Licensed Agent call Craig Swire – your local property expert.
Tel: 01978 799 588          Mobile: 0787 237 6768                                              E-Mail:

Monday, 6 June 2016

10 Reasons Why Buy-To-Let in Wrexham and Chester Is Still An Attractive Investment

Some Media Commentators & So Called Industry Experts Are Calling The Death of Buy-To-Let.. The Truth Is Its Never Been Better To Be A Wrexham or Chester Landlord   

Rents are high and property prices gradually reaching the historic highs that we experienced pre-recession. Seasoned property investors and entrants to the market are more than happy to look at 3.5 – 4% yields for a property that offers strong holding power and the ability to create a long term return.
Yes the days of 10%-12% yields ‘all day long’ may have dried up – but for some to call the death of the industry is a bit extreme.

NLA predicting dark days for buy-to-let in Wrexham & Chester

Earlier in the year the National Landlords Association made some stark remarks off the back of the chancellor George Osborne budget crackdown on landlords, they said:

* 500,000 rental properties will be sold off by landlords
* confidence in the market is at its lowest since the banking crisis
* there is an assault on private residential landlord

So why do I think the best is in sight for Wrexham & Chester landlords

Whilst the scaremongering goes on investors and future buy-to-let landlords have been quietly going about their business acquiring properties to rent out and networking to create joint business ventures to create buy-to-let opportunities.
The people I am meeting and talking to are from all walks of life and from all sectors of the business community, whilst they are not singing from the roof tops about the deals they are doing this is only because they are getting to the best deals first.
Whilst mortgage rates are historically low, stock markets volatile and the return on traditional savings non-existent - the buy-to-let scene is still extremely attractive. But beware while rates are at an all time low now they will increase one day and this has to be figured into your property portfolio business plan.

It's Your Choice

No.1     You can be a choosey landlord

Its currently a landlord’s market. As long as you are sensible with your rental guide price and not discriminatory, you can afford to market the property as you wish and call out to the type of tenant you want in your property.

No.2     Advice & reassurance

There has never been a better era than now for the so-called property expert. As a landlord you have so much experience and so many people willing and able to help you professionally, or to simply to offer you that bit of guidance down at the local pub. Surround yourself with a good group of property professionals i.e. a good accountant, a good solicitor, a good letting agent, a good estate agent and don’t be afraid to ask questions – knowledge about the local Wrexham property market is power.

No.3     500,000 buy-to-let properties returning to the open market

Property investors and those looking to purchase buy-to-let properties will be hanging onto my every word to find out where these properties will enter the market. Not only is the new stock good news it is highly likely that deals can be done to keep the existing tenants in situ or market the property pre-completion so the new owner has rent coming in from day one

No.4     Research your market

Information is available to landlords. A little bit of research can make the difference between actually making an offer for an investment or not.

No.5     Price

Deals can be done especially when its ‘commercially driven’ with a buyer and seller both in the property world.
As a Wrexham property investor you are not reliant on selling a property to buy your next one, you are also not part of a chain so you offer an increased amount of credibility.
Make low offers and don’t get tempted into overpaying, but be conscious of your market and find out who the sellers are and their reasons for moving – this will help negotiations.

No.6     To manage or not to manage?

The world of the traditional letting agent is changing, the change is being dictated by on-line agents and the landlords that are using them, then compounded by local councils, central government and regulatory bodies. This is doing one thing, professionalizing the industry and creating far better property agents who will look after some of your biggest assets.

Self managing is a real option and will save a few pennies. There are new licensing laws that are trying to squeeze landlords out of the market, so self managing sometimes becomes a way of turning a property liability into a property asset OR find an agent who is equally capable through recommendation and who can negotiate better management rates.
Let Someone Else Deal With The Midnight Call
No.7     Location, Location, Size

A Knight Frank survey of 5000 renters found that 52% of renters choose their property because it was near where they worked. News travels fast of businesses expanding or new companies moving into the area. A switched on landlord will be aware and will buy their next buy-to-let where the demand will be. This has been the case in the Deeside and Chester property markets where industry has located in the area and the overspill for rental properties has created a fantastic demand over the last couple of years.

But don’t forget the demographic, after all who will be working, how old are they likely to be, where will they be coming from and will they be alone, buddying up or bringing their families. Sometimes you can create your market, you just need to be tuned in.

No.8     Borrowing for your Wrexham buy-to-let property

Interest rates are at an all time low, buy-to-let mortgages can be found with rates starting at 1.5% with typically a minimum 25% deposit. With lenders looking at the buy-to-let property as a business it is important all costs are considered and that the best mortgage deal is found. Some top tips:

Use an independent mortgage advisor who can source from the whole of the market.
Look at varying deposit amounts and total cost of borrowing which includes fees and charges.
Some lenders will only look at a buy-to-let mortgage if the rental income is 125% of the mortgage repayments. There are an increasing numbers of lenders who are looking for 135% rent/mortgage payment ratio.
 Experienced investors can seek advice from a ‘commercial broker’ who can secure funding based on a business plan style agreement where they consider all of a particular client’s property assets and lend based on group value. Rates can be slightly higher for this bespoke service.

No.9     Rents are increasing in the UK
Average UK Rent [exc. London]

HomeLet Rental Index has reported that the average UK rental value was 764pcm – up 5.1% year on year. This time last year they reported a 7% increase year on year [this information excludes London].

This represents a year on year increase and shows how strong national demand is.

No.10     Rents are increasing in Wales

HomeLet Rental Index has reported that the average rent in Wales up to April 2016 was 597pcm – up 4.3% compared to April 2015.

For more information about this article and local Wrexham property investment advice call Wrexham & Chester property expert, Craig Swire on 01978 799 588 

Tel: 01978 799 588      Mobile: 0787 237 6768              E-Mail: