As Kidlington First-time Buyers are Being Locked Out of the Kidlington Property Market – Rents Have Risen by 3.0%
With the banks reducing the number of low deposit mortgages (i.e. deposit of 10% and below) since Covid-19 hit in the spring, this has meant that the number of Kidlington first-time buyers has been decreasing quickly, meaning many of those would-be Kidlington buyers wanting to make the first step on the Kidlington property ladder will stay in the Kidlington rental sector.
This has caused demand to grow amongst Kidlington renters for larger homes to ride out Covid, as they hunker down for the long haul to wait for normality to return to the property market. This has caused
Kidlington rents to rise from £1,110 to the current £1,143 per month over the last 12 months, an increase of 3.0%.
Interestingly, the opposite is happening in Central London, where the rents tenants are having to pay have dropped by 3.8% in the last 12 months, as demand has dropped like a stone. It appears Central London tenants are looking to move out to the suburbs, in search of bigger homes, gardens and green open spaces. For example, the average rent for a 1-bed apartment in St. John’s Wood currently stands at a very reasonable £1,817 per month whilst a 2-bed apartment in Kensington and Chelsea is currently at an average bargain rent of £3,715 per month (yes, they might be low compared to last year, yet for us in Kidlington, that still seems like a lot of money!). Also, there has been further downward pressure on Central London rents, as many Airbnb landlords have dumped their short-term holiday let properties onto the long-term rental market as the tourism in the capital has dwindled because of the pandemic.
This has been the sharpest drop in Central London rents since the summer of 2009, when the property market was still stumbling from the Credit Crunch.
This means there is a reverse of the trend of the 2010’s (2010 to 2018 to be exact), when initially the London property market was shooting up whilst the rest of the country was in the doldrums. Then, when the rest of the UK did start to rise slowly in 2013, London kicked on even further like a rocket … yet now it appears the opposite is happening.
Getting back to Kidlington, according to the Land Registry property values currently stand 1.5% higher than a year ago; this is split down as follows:
Detached Kidlington homes 1.7% higher
Semi-detached Kidlington homes 2.3% higher
Townhouse/terraced Kidlington homes 1.5% higher
Kidlington apartments/flats 2.1% lower
Yet, do remember, these figures do NOT take into account the prices paid by desperate Kidlington buyers this summer, often paying top dollar to secure the property. This will only filter through in the figures released in the spring.
However, it’s not all doom and gloom for first-time buyers as there are embryonic signs that the 10% deposit mortgage market could gradually be returning to normal, as I have recently heard some lenders taking up to a week for their 10% deposit mortgage offers to run out. Fingers crossed!
So, what does all this mean for Kidlington landlords? Those Kidlington landlords with properties with gardens and larger rooms will be seeing increased demand. The ability to have pets in the rental property is also an advantage, and depending on the property, can add a decent premium to the rent that can be charged.
One final thought though for all homebuyers in Kidlington, be aware it’s going to be very challenging to get your house purchase through in time to meet the 31st March 2021 stamp duty holiday cut off if you are starting the process in November. Make sure your lender and solicitor have the capacity to meet that deadline and when you are asked for information, you drop everything to provide it. The odd days’ delay here and there will mean the difference between you getting the keys for your new Kidlington home before the end of March 2021 and saving thousands of pounds in Stamp Duty Tax … or feeling a fool from the 1st April 2021 and having to pay the tax!