New House Building in Huddersfield increased by 23.6% in the last year

Let me speak frankly, even with Brexit and the fact immigration numbers will now be reduced in the coming years, there is an unending and severe shortage of new housing being built in the Huddersfield area (and the UK as a whole).  Even if there are short term confidence trembles fueled by newspapers hungry for bad news, the ever growing population of Huddersfield with its high demand for property versus curtailed supply of properties being built, this imbalance of supply/demand and the possibility of even lower interest rates will underpin the property market.

When the Tories were elected in 2015, Mr. Cameron vowed to build 1,000,000 new homes by 2020.  If we as a Country hit those levels of building, most academics stated the UK Housing market would balance itself as the increased supply of property would give a chance for the younger generation to buy their own home as opposed to rent.  However, the up-to-date building figures show that in the first three months of 2016 building starts were down.  Nationally, there were 35,530 house building starts in the first quarter, a long way off the 50,000 a quarter required to hit those ambitious targets.

Looking closer to home, over the last 12 months, new building in the Kirklees Council area has grown.  In 2014/15, for every one thousand existing households in the area, an additional 2.03 homes were built.  For 2015/16, that figure is now 2.51 homes built per thousand existing households.  Nationally, to meet that 1,000,000 new homes target, we need to be at 7.12 new homes per thousand.

To put those numbers into real chimney pots, over the last 12 months, in the Kirklees Council area,

·         450 Private Builders (e.g. New Homes Builders)

·         Nil   Housing Association

·         Nil   Local Authority

These new house building numbers are down to the fact that not enough is being done to fix the broken Huddersfield housing market.  We are still only seeing 450 new homes being built per year in the Kirklees Council area, when we need 1,276 a year to even stand still!

I am of the opinion Messer’s Cameron and Osborne focused their attention too much on the demand side of the housing equation, using the Help to Buy scheme and low deposit mortgages to convert the ‘Generation Rent’ i.e. Huddersfield ‘20 somethings’ who are set to rent for the rest of their lives to ‘Generation Buy’.  On the other side of the coin, I would strongly recommend the new Housing Minster, Gavin Barwell, should concentrate the Government’s efforts on the supply side of the equation.  There needs to be transformations to planning laws, massive scale releases of public land and more investment, as more inventive solutions are needed.

However, ultimately, responsibility has to rest on the shoulders of Theresa May.  Whilst our new PM has many plates to spin, evading on the housing crisis will only come at greater cost later on.  What a legacy it would be if it was Mrs. May who finally got to grips with the persistent and enduring shortage of homes to live in.  The PM has already referenced the ‘need to do far more to get more houses built’ and stop the decline of home ownership.  However, she has also ruled out any changes to the green belt policy – something I will talk about in a future up and coming article.  Hopefully these statistics will raise the alarm bells again and persuade both residents and Councilor’s in the Kirklees Council area that housing needs to be higher on its agenda.

Only 33.3% of Huddersfield Rented Property have Children living in them.

A few weeks ago I was asked a fascinating question by a local Councillor who, after reading the Huddersfield Property Blog, emailed me and asked me – “Are Huddersfield Landlords meeting the Challenges of tenanted families bringing up their families in Huddersfield?”

What interesting question to be asked.

Irrespective of whether you are tenant or a homeowner, to bring up a family, the most important factors are security and stability in the home. A great bellwether of that security and stability in a rented property is whether tenants are constantly being evicted. Many tenancies last just six months with families at risk of being thrown out after that with just two months’ notice for no reason.

Some “left leaning Politian’s” keep saying we need to deal with the terrible insecurity of Britain’s private rental market by creating longer tenancies of 3 or 5 years instead of the current six months. However, the numbers seem to be telling a different story. The average length of residence in private rental homes has risen in the last 5 years from 3.7 years to 4 years (a growth of 8.1%), which in turn has directly affected the number of renters who have children. In fact, the proportion of private rented property that have dependent children in them, has gone from 29.1% in 2003 to 37.4% today.

Looking specifically at the HD2 area of Huddersfield compared to the National figures, of the 2,243 private rental homes in Huddersfield, 748 of these have dependent children in them (or 33.3%), which is interestingly (although expected) below the National average of already stated 37.4%.

Even more fascinating are the other tenure types in HD2 Huddersfield…

·         39.1% of Social (Council) Housing in Huddersfield have dependent children

·         47% of Huddersfield Owner Occupiers (with a Mortgage) have dependent children

·         14% of Owner Occupiers (without a Mortgage) have dependent children

Although, when we look at the length of time these other tenure types have, whilst the average length of a tenancy for the private rented sector is 4 years, it is 11.4 years in social (council) housing, 24.1 years for home owners without a mortgage and 10.4 years of homeowners with mortgages.

Anecdotally I have always known this, but this just proves landlords do not spend their time seeking opportunities to evict a tenant as the average length of tenancy has steadily increased. This noteworthy 8.1% increase in the average length of time tenants stay in a private rented property over the last 5 years, shows tenants are happy to stay longer and start families.

So, as landlords are already meeting tenants’ wants and needs when it comes to the length of tenancy, I find it strange some politicians are calling for fixed term 3 and 5 year tenancies. Such heavy handed regulation could stop landlords renting their property out in the first place, cutting off the supply of much needed rental property, meaning tenants would suffer as rents went up. Also, if such legislation was brought in, tenants would loose their ‘Get Out of Jail card’, as under current rules, they can leave at anytime with one months notice not the three or six month tenant notice suggested by some commenters. 

Finally, there is an extra piece of good news for Huddersfield tenants. The English Housing Survey notes that those living in private rented housing for a long periods of time generally paid less rent than those who chopped and changed.

9,000 People Live In Every Square Mile Of Huddersfield – Is Huddersfield Over Crowded?

Huddersfield is already in the clutches of a population crisis that has now started to affect the quality of life of those living in Huddersfield. There are simply not enough homes in Huddersfield to house the greater number of people wanting to live in the town. The burden on public services is almost at breaking point with many parents unable to send their child to their first choice of primary or secondary school and the chances of getting a decent Dentist or GP Doctor Surgery next to nil.

Well that’s what the papers would say.. but let’s look at real numbers, and in particular my specialist subject of Huddersfield Property, with the housing issue in Huddersfield. To start with, the UK has roughly 1,065 people per square mile – the second highest in Europe. The total area of Huddersfield itself is 18.050 square miles and there are 162,900 Huddersfield residents, meaning …

9,000 people live in each square mile of Huddersfield, it’s no wonder we appear to be bursting at the seams!

… but yet again, newspapers, politicians and property market bloggers quote big numbers to sell more newspapers, get elected or get people to read their blog (I recognise the irony!). A square mile is enormous, so the numbers look correspondingly large (and headline grabbing). Most people reading this will know what an ‘acre’ is, but those younger readers who don’t, it is an imperial unit of measurement for land and it is approximately 63 metres square.

In Huddersfield, only 12.86 people live in every acre of Huddersfield … not as headline grabbing, but a lot closer to home and relative to everyday life, and if I am being honest, a figure that doesn’t seem that bad.

Yet, the issue at hand is, we need more homes building. In 2007, Tony Blair set a target that 240,000 homes a year needed to be built to keep up with the population growth, whilst the Tory’s new target since 2010 was a more modest 200,000 a year. However, since 2010, as a country, we have only been building between 140,000 and 150,000 houses a year. So where are we going to build these homes .. because we have no space! Or do we?

Well, let me tell you this fascinating piece of information I found out recently in an official Government report. Looking specifically at England (as it is the most densely populated country of the Union), all the 20 million English homes cover only 1.1% of its land mass. That is not a typo, only one point one per cent (1.1%) of land in England is covered by residential property. In more detail, of all the land in the Country -

·         Residential Houses and Flats 1.1%

·         Gardens 4.3%

·         Shops and Offices 0.7%

·         Highways (Roads and Paths) 2.3%

·         Railways 0.1%

·         Water (Rivers /Reservoirs) 2.6%

·         Industry, Military and other uses 1.4%

.. leaving 88.5% as Open Countryside (and if you think about it, add to that the gardens, which are green spaces, and the country is 92.8% greenspace)

As a country, we have plenty of space to build more homes for the younger generation and the five million more homes needed in the next 20 years would use only 0.25% of the country’s land. Now I am not advocating building massive housing estates and 20 storey concrete and glass behemoth apartment blocks next to local beauty spots such as Greenhead Park or nearby Castle Hill, but with some clever planning and joined up thinking, we really do need to think outside the box when it comes to how we are going to build and house our children and our children’s children in the coming 50 years in Huddersfield. If anyone has their own ideas, I would love to hear from you.

In the meantime, if you would like to read other articles about Huddersfield Property Market, please visit the Huddersfield Property Market Blog https://huddersfieldproperty.blogspot.co.uk/

79.5% of Kirklees Properties have 3 or more bedrooms – Problem or Opportunity?

The orthodox way of classifying property in the UK is to look at the number of bedrooms rather than its size in square metres (although now we are leaving the EU – I wonder if we can go back to feet and inches?). It seems that homeowners and tenants are happy to pay for more space. It’s quite obvious, the more bedrooms a house or apartment has, the bigger it is likely to be. The reason being not only the actual additional bedroom space, but the properties with more bedrooms tend to have larger / more reception (living) rooms. However, if you think about it, this isn’t so astonishing given that properties with more bedrooms would typically accommodate more people and therefore require larger reception rooms.

In today’s Huddersfield property market, the Huddersfield homeowners and Huddersfield landlords I talk to are always asking me which attributes and features are likely to make their property comparatively more attractive and which ones may detract from the price. Over time, buyers’ and tenants’ wants and needs have changed. In Huddersfield, location is still the No. 1 factor affecting the value of property, and a property in the best neighbourhoods, say Edgerton, Ainley Top or Nettleton Hill can command a price nearly 50% higher than a similar house in an ‘average’ area. However, after location, the next characteristic that has a significant influence on the desirability, and thus price, of property is the number of bedrooms and the type (i.e. Detached/ Semi/Terraced/Flat).
In previous articles, I have analysed the Huddersfield housing stock into bedrooms and type of property, but never before now have I cross-referenced type against bedrooms. These figures for the Kirklees Metropolitan Council area make fascinating reading. It shows 79.5% of all properties in the area have 3 or more bedrooms

	Detached	Semi-detached	Terraced (including end-terrace)	Flat
1 bedroom	111	246	419	536
2 bedrooms	1,129	5,825	9,944	1,855
3 bedrooms	6,144	21,704	18,326	485
4 bedrooms	10,548	6,879	5,336	125
5 or more bedrooms	4,263	2,294	1,827	56

I was genuinely surprised at the low numbers of one and two bed properties, especially 2 bed semis detached houses, especially as tenants like the smaller one and two bed properties in Huddersfield. You see, it might interest the homeowners and landlords of Huddersfield, that there has been a change in the numbers of properties on the market and the split in bedrooms on the market over the last 12 months

·         12 months ago, 51 one bed properties were for sale in Huddersfield, today 82, a rise of 61%

·         12 months ago, 308 two bed properties were for sale in Huddersfield, today 288, a drop of 6%

·         12 months ago, 273 three bed properties were for sale in Huddersfield, today 238, a drop of 13%

·         12 months ago, 127 four bed properties were for sale in Huddersfield, today 102, a drop of 20%

·         12 months ago, 63 five + bed properties were for sale in Huddersfield, today 55, a drop of 13%

For several years Huddersfield buy-to-let investors have been the only buyers at the lower end (starter homes) of the market, as they have been enticed by high tenant demand and attractive returns. Some Huddersfield landlords believe their window of opportunity has started to close with the new tax regime for landlords, whilst it already appears to be opening wider for first-time buyers. This is great news for first time buyers ... but one final note for Huddersfield landlords ... all is not lost ... you can still pick up bargains, you just need to be a lot more savvy and do your homework ... one source of such information with articles like this is the Huddersfield property market Blog https://huddersfieldproperty.blogspot.co.uk/

The Huddersfield Love Affair with its 27,600 Terraced Houses

Call me old fashioned, but I do like the terraced house.   In fact, I have done some research that I hope you will find of interest my Huddersfield property market blog reading friends!

In architecture terms, a terraced or townhouse is a style of housing in use since the late 1600’s in the UK, where a row of symmetrical / identical houses share their side walls. The first terraced houses were actually built by a French man, Monsieur Barbon around St. Paul’s Cathedral within the rebuilding process after the Great Fire of London in 1666.  Interestingly, it was the French that invented the terraced house around 1610-15 in the Le Marais district of Paris with its planned squares and properties with identical facades. However, it was the 1730’s in the UK, that the terraced/townhouse came into its own in London and of course in Bath with the impressive Royal Crescent.

However, we are in Huddersfield, not Bath, so the majority of our Huddersfield terraced houses were built in the Victorian era.  Built on the back of the Industrial Revolution, with people flooding into the towns and cities for work in Victorian times, the terraced house offered decent livable accommodation away from the slums. An interesting fact is that the majority of Victorian Huddersfield terraced houses are based on standard design of a ‘posh’ front room, a back room (where the family lived day to day) and scullery off that.  Off the scullery, a door to a rear yard, whilst upstairs, three bedrooms (the third straight off the second).  Interestingly, the law was changed in 1875 with the Public Health Act and each house had to have 108ft of livable space per main room, running water, it’s own outside toilet and rear access to allow the toilet waste to be collected (they didn’t have public sewers in those days in Huddersfield – well not at least where these ‘workers’ terraced houses were built).

It was the 1960’s and 70’s where inside toilets and bathrooms were installed (often in that third bedroom or an extension off the scullery) and gas central heating in the 1980’s and replacement Upvc double glazing ever since.

Looking at the make up of all the properties in Huddersfield, some very interesting numbers appear.  Of the 72,589 properties in Huddersfield …

11,867 are Detached properties (16.3%)

22,137 are Semi Detached properties (30.5%)

27,604 are Terraced / Town House properties (38.0%)

10,954 are Apartment/ Flat’s (15.0%)

And quite noteworthy, there are 27 mobile homes, representing 0.04% of all property in Huddersfield. 

When it comes to values, the average price paid for a Huddersfield terraced house in 1995 was £32,880 and the latest set of figures released by the land Registry states that today that figure stands at £91,580, a rise of 179% - not bad when you consider apartments in Huddersfield in the same time frame have only risen by 49%.

But then a lot of buy to let landlords and first time buyers I speak to think the Victorian terraced house is expensive to maintain.  I recently read a report from English Heritage that stated maintaining a typical Victorian terraced house over thirty years is around sixty percent cheaper than building and maintaining a modern house- which is quite fascinating don’t you think!

Don’t dismiss the humble terraced house – especially in Huddersfield!  For more thoughts on the Huddersfield Property Market – visit the Huddersfield Property Market Blog https://huddersfieldproperty.blogspot.co.uk/

30.2% Of Huddersfield Homes Are One Person Households

I was having an interesting chat with a Huddersfield buy to let landlord the other day when the subject of size of households came up in conversation.  For those of you who read my Brexit article published on the morning after the referendum, one of the reasons on why I thought the Huddersfield property market would, in the medium to long term, be OK, was the fact that the size of households in the 21^st Century was getting smaller – which would create demand for Huddersfield Property and therefore keep property prices from dropping.

Looking at the stats going back to the early 1960’s, when the average number of people in a home was exactly 3, it has steadily over the years dropped by a fifth to today’s figure of 2.4 people per household. Doesn’t sound a lot, but if the population remained at the same level for the next 50 years and the we had the same 20% drop in household size, the UK would need to build an additional 5.28 million properties ( or 105,769 per year) .. When you consider the Country is only building 139,800 properties a year ... it doesn’t leave much for people living longer and immigration. Looking closer to home...

In the Kirklees Metropolitan Borough Council area, the average

number of occupants per household is 2.4 people

When we look at the current picture nationally and split it down into tenure types (i.e. owned, council houses and private renting, a fascinating picture appears.

The vast majority of homeowners who don’t have a mortgage are occupied by one or two people (81% in fact), although this can be explained as residents being older, with some members of the family having moved out, or a pensioner living alone.  People living on their own are more likely to live in a Council house (43%) and the largest households (those with 4 or more people living in them are homeowners with a mortgage – but again, that can be explained as homeowners with families tend to need a mortgage to buy. What surprised me was the even spread of private rented households and how that sector of population are so evenly spread across the occupant range – in fact that sector is the closest to the national average, even though they only represent a sixth of the population.

When we look at the Kirklees Metropolitan Borough Council figures for all tenures (Owned, Council and Private Rented) a slightly different picture appears...

  

But it gets even more interesting when we focus on just private rental properties in Huddersfield, as it is the rental market in Huddersfield that really fascinates me. When I analysed those Kirklees Metropolitan Borough Council private rental household composition figures, a slightly different picture appears. Of the 24,523 Private rental properties in the Kirklees Metropolitan Borough Council area,

·         38.5% of Private Rental Properties are 1 person Households

·         29.7% of Private Rental Properties are 2 person Households

·         15.5% of Private Rental Properties are 3 person Households

·         9.6% of Private Rental Properties are 4 person Households

·         6.5% of Private Rental Properties are 5+ person Households

As you can see, Huddersfield is not too dissimilar from the national picture but there is story to tell.  Properties have to be in the right part of Huddersfield and priced realistically, but they will always let and when you need to sell, irrespective of market conditions at the time, will always be the target of buyers. To read more articles on the Huddersfield Property Market and where I consider best buy to let deals are in Huddersfield, please visit the Huddersfield Property Market Blog  

Post Brexit - Huddersfield Property Prices set to drop £13,700 in the next 12 months?

Even the most sane person in Britain has to admit the Brexit vote will, in one shape or another, affect the UK Property market. Excluding central London which is another world, most commentators are saying prices will be affected by around 10%. So looking at the commentators’ thoughts in more detail, property values in Huddersfield will be 10% lower than they would have been if we hadn’t voted to leave the EU.

As the average value of a property in the Kirklees Council area is £136,700, this means property values are set to drop for the average Huddersfield property by £13,670 … batten down the hatches .. soup kitchens and mega recession here we come ..it’s going to get rough.

.. but before we all go into panic mode in Huddersfield .. the devil is always in the detail

Look at the phrase again, and I have highlighted the relevant part “Property values in Huddersfield will be 10% lower than they would have been if we hadn’t voted to leave the EU”

Property values today, according to the Land Registry are 5.3% higher than a year ago in the Kirklees Council area. The 12 months before that they rose by 4.29% and the 12 months before that, they rose by 4.2%. If we hadn’t voted to leave, I believe on these figures, we could have safely assumed Huddersfield House prices would have been 4.5% higher by the Summer of 2017.

… and that’s the point, we won’t see a house price crash in Huddersfield, it’s just that house prices in a years time will be 5.5% lower than they are now (ie 4.5% less the 10% lower figure because of Brexit). Let’s look at the historic figures and how that compares to today’s figures for the Kirklees Council area and Huddersfield as a whole.

Average Value of a property 20 years ago                              £ 43,700

Average Value of a property 10 years ago                              £129,200

Average Value of a property 2 years ago                                £124,500

Average Value of a property 1 year ago                                 £129,900

Average Value of a property today                                         £136,700

Projected Value of a property in 12 months’ time             £130,550

Therefore, I believe the average value of a Huddersfield property will be £6,150 lower in 12 months’ time than today.

That’s not to say Huddersfield property prices might not dip slightly in the run up to Christmas (in fact they always have done just about every year since the year 2000 and most of those were boom years) .. but in 12 months time this is my considered opinion of where Huddersfield property values will be.. and looking at the historic prices, even if I (and many other property market commentators) are wrong and they drop 10% from TODAY’S figure .. in the whole scheme of things, we have been through a Credit Crunch, Black Monday and 15% interest rates over the last 20 to 30 years .. and still Huddersfield house prices have always bounced back.

Whilst the UK's vote for Brexit has created an uncertainty in the Huddersfield housing market, there is no need to panic and prospective buyers should merely use common sense about their purchases. I always say to people to be prudent and if you are taking out a mortgage, at some stage during the life of that mortgage, circumstances will be difficult. We won’t have a 2008 Credit crunch fire sale of properties because after the Mortgage Market Review which took place in the Spring of 2013, mortgage borrowers are not as highly leveraged this time around.  As a result of this, with any luck there will not be too many distressed sales, which cause widespread price reductions.

.. and Huddersfield landlords? They have recently been thrashed by Osborne’s tax changes, but yields could rise if Huddersfield house prices fall/stablise and rents grow, and this might also make it easier to obtain mortgages, as the income would cover more of the interest cost. If prices were to level or come down that could help Huddersfield landlords add to their portfolio, as rental demand for Huddersfield property is expected to stay strong as more people find it more and more difficult to obtain mortgages.

For more thoughts on the Huddersfield Property market .. visit the Huddersfield Property Blog https://huddersfieldproperty.blogspot.co.uk/