April Fools Day
was no joke for some landlords, as they rushed their buy to let property
purchases throughout late March to beat the extra 3% stamp duty George Osborne
imposed on buy to let properties after the 31st March 2016. Because some
investors brought forward their 2016 property purchases to save the extra tax,
speaking to fellow property professionals in Dartford, all of us have noticed,
since the clocks went forward, demand to buy in April and May from these
landlords has eased.
Then we have the
Brexit issue, which is also having a tempering effect on the Dartford property
market – although if you recall I wrote about this a few weeks ago, and whilst
an exit will have an effect – it won’t be the end of the world scenario some
commentators are suggesting. In another article I wrote previously, I spoke of
the growth rate of Dartford property values, and whilst the rate of growth is
slowing, Dartford property values are still 9% higher year on year, albeit the
growth rate month on month has started to moderate when compared to the heady
days of month on month rises of 2014 and 2015. Interestingly though, a very
recent members survey of the Royal Institution of Chartered Surveyors states
that only 17% of members believed property values would increase over the next
Quarter compared to 44% at the end of 2015.
All this had led
to increase in the number of properties for sale. For example in the DA1
postcode, which mainly comprises of Dartford and Crayford, there were 178
properties for sale in the postcode in December (of which 73 came on to the
market for the first time). In January, February and March, 389 properties came
onto the market in the postcode district (or an average of 129 per month),
meaning by end of the first Quarter, there were 237 properties available for
homeowners and landlords alike to buy in DA1 (i.e. a rise of 33.1% more
properties for sale). These figures are mirrored in neighbouring postcodes
throughout the Dartford area.
Nevertheless, I
believe this easing of the Dartford property market is a good thing, as
investment landlords wont have to pay top dollar to secure a property because
of the lower competition. On the face of it, this easing should be bad news for
the 35,116 Dartford homeowners, but nothing could be further from the truth.
The majority of homeowners that move, move up market, (i.e. from a flat to
terrace/town house, then a semi and then detached), so whilst last year you
would have achieved a top dollar figure for your property, you would would have
had to have paid an even higher top dollar to secure the one you wanted to buy.
The Swings and Roundabouts of the Dartford Property Market!
However, all the
signals suggest that whatever the aftermath of the approaching EU referendum,
in the long term, the disparity between demand for Dartford property and the
supply (i.e. the number of actual properties) will still exercise a sturdy and
definitive influence on the Dartford property market. It would surprise me that
if by 2021, whichever way we vote in late June, assuming we don’t have another
credit crunch or issues like a major world conflict, property prices will be
between 20% to 23% higher than they are today.
