Huddersfield Homeownership Rockets by 3,332 Homes in the Last 5 Years

 

 

·             The Huddersfield housing market over the last five years has behaved oddly.

 

·         Huddersfield house prices are 34.4% higher than in 2017, even though during those five years, the British economy had the uncertainty of Brexit and the massive fall in GDP during the pandemic.

 

·         Yet, a less observed trend is that the net number of homeowners in Huddersfield has risen by 3,332 households, a jump of 3.7%.

 

·         Why has growth in homeownership happened, and what does it mean for Huddersfield's existing homeowners (and landlords)?

 

With the newspapers full of news about the death of homeownership and the growth in Generation Rent, it must surprise many (as it did with me) that the number of homeowners in Huddersfield has grown.

 

To give some context…

 

the number of homeowners in Huddersfield dropped between 2011 and 2017 by 339 households, yet between 2017 and 2021, that grew by 3,332 households.

 

So, what is behind this growth in homeownership and is it a good thing?

 

Politicians love it when homeownership rises, as they believe owning a house turns individuals into model upright citizens. It was one of the critical reasons for the council house sell-off in the 1980s.

 

Yet the hard data to back this up is unexpectedly slim, whilst other studies hint that homeownership has some harmful costs to the economy, such as reduced entrepreneurial spirit and the disinclination to move home to find work.

 

However, increasing homeownership may be a good foundation for Britain’s economic recovery after the last few years. Homeowners have a greater propensity to live in single-family unit homes like townhouses and semi-detached houses.

 

A greater demand for more single-use homes supports the construction of such dwellings (instead of other types such as small apartment blocks or Homes of Multiple Occupation). This is important because single-family unit homes tend to be better build quality, have more extensive gardens, and have more local amenities.

 

So, what are the sort of numbers I am talking about in Huddersfield?

 

In 2017, there were 43,405 Huddersfield owner-occupied homes.

By 2021, this had grown to 46,737 Huddersfield homes.

 

This means homeownership in Huddersfield has risen from 60.65% of the households in Huddersfield in 2017 to 62.88% in 2021, a proportional increase of 3.7%.

So, what is behind this growth in homeownership?

 

1.      95% mortgages have been readily available at low-interest rates now for over a decade. In 2017, first-time buyers also got an exemption from stamp duty. This created a perfect storm of demand, which caused the number of Huddersfield first-time buyers to rise.

 

2.      Whilst the rise in homeownership in Huddersfield precedes the pandemic by a couple of years, another factor to the growth relates to the last property market recession of 2008/9 (the Credit Crunch). Between 2009 and 2012, many Huddersfield homeowners found themselves unemployed and still had to pay mortgages at 6% to 8%. Some homes were repossessed or some had to sell their home at a low price to unshackle themselves from their high mortgage costs. This development, nevertheless, took many agonising years to play out, reducing the homeownership until the middle of the last decade.

 

3.      People’s views on the way they live have altered during the lockdowns. In a sphere of stay-at-home instructions and social distancing, the peace of mind of homeownership gives Huddersfield homeowners the security of tenure.

 

4.      Finally, there has been a long-term change in the demographics of the UK. Millennials (currently aged between 26 and 41) are less likely to be homeowners than their Baby Boomer parents were at the same age. Yet, the British millennial generation is now entering its prime home-buying period as they have saved their deposit and are more likely to inherit money from their grandparents. (The average age of a first-time home-buyer in the UK is 33 compared to 26 in the mid-1990s).

 

So, the final question has to be…

 

how much further could homeownership go in Huddersfield?

 

The biggest hurdle could prove to be the supply of available homes.

 

Many 'accidental landlords' have been selling their properties recently, which first-time buyers have bought. Accidental landlords put their own homes up for rent in the early to mid-2010’s because they could not sell. Now they have been motivated to cash in on the higher Huddersfield house prices in the last couple of years, which increased the supply of properties to buy for owner-occupation.

 

Also, the number of houses on the market in the UK available to buy has increased from existing owner-occupiers. In December 2021, there were 355,700 properties for sale yet by March 2022, that had risen to 431,000. This is giving greater confidence to other Huddersfield homeowners too scared to put their homes up for sale because they are concerned they would to not be able to find anything else. Things are starting to change in that regard. 

 

Also, there are signs of a recovery in British new home building as the number of new housing starts in 2021 hit the highest level since the financial crisis of 2007. Yet with a steady increase in Huddersfield landlords returning to the market in the last few months, this tide will turn.

 

Huddersfield’s homeownership could continue to swell for a while yet!

 

P.S. What does this mean to the private rented sector in Huddersfield? Come back next week as I give some fantastic insights every Huddersfield landlord will want to read to ensure they remain profitable in the Huddersfield buy-to-let market.

 

4,865 Brighouse Terraced Houses Why Are They So Popular?

 

The terraced house is one of the most familiar styles of home in Brighouse (and the UK as a whole).

 

32.6% of Brighouse people live in a terraced home, interesting when compared with the national average of 22.7%.

 

So, what is it about the humble terraced/townhouse us Brits love so much? In this article, I look at the history of the terraced house, how it relates to Brighouse and what the future holds for terraced homes.

 

A terraced house is a property built as part of a continuous row of three (or more) properties in a similar and uniform style.

 

The reason the British call them 'terraced houses' and not 'row houses' came about because 18th century British architects borrowed the phrase 'terrace' from 'terraced gardens’. Terraced gardens were known for their uniform nature (in looks, style and height etc.), so the architects decided to name them the same way as opposed to a ‘row house'. In fact, in most countries, they are called 'row houses'.

 

The terraced house originated in the Low Countries of Europe

 in the late 1500s.

 

Terraced houses were first built en-masse in the UK after the Great Fire of 1666 with the rebuilding of London.

 

They became fashionable for the landed gentry in the early Georgian era with chic and stylish terraces appearing in London's Mayfair and Bath with its Queen Square (the forerunner of the famous Royal Crescent) and were sometimes built around a garden square.

 

However, it wasn’t until the early 1800s that the terraced house turned out to be the solution to the increasing population of the towns as more and more people were attracted to towns and cities for work.

 

The terraced house fell out of favour with the upper-middle classes in the late Victorian age (1870’s onwards) as they wanted more privacy and space. They moved to live in detached houses or semi-detached villas, as the terrace house had started to become associated with the lower-middle and working classes.

 

With all these terraced houses being built, their quality of construction and design dropped as builders tried to squeeze more profit. The biggest issue was that most of the terraced houses built in the early to mid-Victorian age (1840s to 1870s) were made back-to-back with no rear garden, causing unsanitary conditions. Therefore, the Public Health Act of 1875 was introduced to regulate the building of terraced houses with design and standards.

 

These new building standards in the Act improved the terraced house’s ventilation and, more importantly, required the house to have a toilet (frequently built outside). To meet these new building standards, the designs of these new houses created the well-known landscape of ‘grid' streets lined with two-storey terraces serviced by a pedestrian path between them, the name of which is a hotly debated topic. The various names for the pathway include alleyway / jitty / cut/ ginnel / snicket / passageway / ten foot / five foot / witchel / lonnin / vennel.

 

As a Brighouse resident, why not say what you call them in the comments?

 

As we entered the 20th Century, the terrace house continued to be popular, albeit with some new architectural additions.

 

The advent of Arts and Craft architecture with stain glass windows, Tudor style cladding, ornate porches, and elaborate chimney stacks.

 

After the First World War and the introduction of the Housing and Town Planning Act 1919 (which made local councils build council houses), the Victorian terraced rapidly became associated with overcrowding and slums (especially those back-to-back terraced houses built before 1875). Many of the back-to-back terraced houses were knocked down between 1930 and 1960 in what is known as the slum clearances.

 

Private builders started building the iconic suburban semi-detached houses with more extensive gardens, and local authorities decided to build high-rise blocks after World War II. Yet after the partial collapse of Ronan Point in 1968, the popularity of high-rise tower blocks waned.

 

Since the early 1990s though, the terraced house has steadily come back into favour as building land prices have increased by 322% in the last 30 years.

 

Many private builders have started to build modern three-storey townhouses in rows of five to seven. This terraced 'townhouse-style' allows three and four bedrooms on a land footprint that would have usually only accommodated a smaller two-bed property.

 

So, let's look at some interesting stats on Brighouse terraced houses.

 

·         There are 4,865 terraced houses in Brighouse (broken down as 3,467 privately owned terraced houses, 357 terraced council houses and 1,041 in the private rented sector)

 

·         21.4% of terraced houses in Brighouse are in the private rented sector, which is above the national average of 19.1%

 

·         One of the most expensive terraced houses sold in Brighouse was on Halifax Road, Brighouse for £367,000 in 2017

 

·         The cheapest Brighouse terraced house sold in the last two years was on Bramston Street, a terraced house for £39,000

 

·         Terraced houses in Brighouse sell for an average of £143 per square foot

 

I hope you found that thought-provoking?

 

So, why is the terraced house, be it a red brick Victorian house or a more modern three-storey townhouse, still popular today in Brighouse?

 

They are typically well built, cheaper to maintain (especially the older terraced houses), comparatively spacious, and in good locations. Many terraced houses have been improved and extended through the inventive use of rear gardens/yards and converted roof spaces; their unpretentious design remains adaptable enough for 21st century living; what isn't there to like about them?

 

These are my thoughts; tell me your thoughts about the humble yet versatile Brighouse terraced house.

54% Drop in Huddersfield Council Houses in the Last 40 Years

 

·         In 1981, 26.2% of properties in Huddersfield (and the Kirklees Borough as a whole) were council houses. Today, that figure stands at 12%, a proportional drop of 54%.

 

·         Why has the number of council houses dropped so much in those 40 years?

 

·         How has that changed the dynamics of the Huddersfield property market in those 40 years?

 

The ability of local authorities to build council houses came into law in July 1919 with the 1919 Housing and Town Planning Act. It was one of the most important pieces of domestic legislature passed after WW1 and was the first time in the UK that a nationally public funded system of providing homes was made for the masses. It was paid for mostly by central government and provided by local authorities (councils) and public utility societies (which in later years became today’s housing associations). 

 

Between 1919 and 1979, 6.94 million council houses were built.

 

Just over 1 million council houses were built between 1920 and 1939, whilst 5,804,150 council houses were built between 1946 and 1979. This is compared to 4,533,440 private homes and 260,910 housing association properties in the same time frame (’46 to ’79).

 

So, between 1946 and 1979, the council house was the dominate force of British housing. But that all changed in 1979!

 

Many people believe it was Margaret Thatcher who was the architect of allowing the sitting tenant of a council house to buy their home. Interestingly, council house tenants have been able to buy their council house from as early as the mid 1930s, albeit with little or no discount. Also, as late as 1977, the Labour Housing Minster published a Green Paper extolling the virtues of homeownership and council tenants being able to buy their home at a discount.

 

But after the General Election of 1979, the new Tory government drafted the Housing Act 1980, which gave the Right to Buy, which became law in the autumn of 1980. Then things really took off!

This new law established a right for most council tenants who had been in their home for three years or more to a discount. The discount started at 33% and increased by 1% for each extra year, up to a maximum of 50%. If the tenant sold the house within the first five years of ownership, a prorated repayment of their discount was required.

 

Between 1980 and 1989, 970,558 council houses

nationally were sold at a discount.

 

Yet the issue was, when a council house was sold, it took that house out of the council’s portfolio for future generations. From the start, there were limitations on local authorities’ use of monies from the council house sales as most of it had to be given to central government in London, meaning only 390,560 new council houses were built between 1980 and 1989. Looking at the numbers locally …

 

in 1981, there were 35,648 council houses

in Kirklees, today it’s 20,886.

 

No wonder the country has a housing crisis … yet as my regular readers know - the devil is in the detail … and that devil is the humble housing association. 

 

The Tory General Election Manifesto in 1979 had proposed the rights for both council house and housing association tenants to buy their own house under the Right to Buy scheme. The Conservatives argued housing associations, who obtained government funding, should be subject to the same Right to Buy proposals as councils. The Government won the vote in the Commons, yet lost the vote in the Lords, meaning housing association tenants could not buy their homes at a large discount.

 

At the time, there were only 400,000 housing association properties in the country, so the Government were not that worried. But the significance of housing associations developed in the 1980s and beyond as they were allowed to borrow money from the private sector.

 

Between 1949 and 1979, the average number of housing association properties built annually was 8,524. Since 1979 to today, it has been 25,062 per year (and 31,606 per year in the 2010s).

 

Also, the Government encouraged councils to transfer their remaining council houses to housing association schemes from 1986. The advantage to these ‘stock transfers’ was the Government allowed housing associations to access private funding to improve their existing properties and buy new ones (good news for existing tenants complaining that the local authority never upgraded their homes).

 

Moreover, the Tory Government liked stock transfers, as it allowed them to dismantle council housing from the inside. Interestingly, Labour expanded the ‘Stock Transfer’ process in 1997 and further reduced the eligibility for council tenants’ Right to Buy, meaning the number of council tenants exercising their Right to Buy declined considerably.

 

Meaning today, even though the provision of council housing has dropped like the proverbial

stone … 

 

the number of housing association properties in Kirklees

has increased from 1,280 in 1981 to 5,639.

 

So, how has this changed the dynamic of the Huddersfield property market in the last 40 years?

 

Would it surprise you to learn that the number of people who own their own Huddersfield home today is very similar to what it was 20 years ago before the property boom started? It’s just that even though we’ve had a large drop in the number of council houses and an increase in the number of housing association properties, the number of people owning their own home has remained relatively the same (in some areas of Huddersfield this has actually increased), the significant issue is the growth of the private rented sector.

 

It's almost as if people who used to rent from the council

now rent from a private landlord.

 

The question is, is it right for private individuals to make money from tenants who rent from them as opposed to the local authority? Or are private landlords providing better types, choices and quality of accommodation for these tenants, albeit at a higher rental rate than if they rented a council house?

 

I really do believe if it wasn’t for the growth of the buy-to-let landlord, which began in the early 2000s, we would have an even bigger housing crisis on our hands than the one we have currently.

 

Both local and central government have had their hands tied behind their backs since 2008 with a lack of funding, and it’s the humble private landlord who has stepped up and supplied in excess of 2.3million additional rental properties since 2001, housing nearly 5,520,000 Brits. These landlords have saved the day since the big council house sell off in the 1980s!

 

What are your thoughts on this matter?

1 in 4 Huddersfield Homeowners Unable to Sell

·         The average time to find a buyer for a Huddersfield property reduced from 73 days in 2020 to 43 days in 2021.

 

·         Yet still, just under 1 in 4 Huddersfield homeowners are on the market after 12 weeks.

 

·         Why are so many Huddersfield homes still on the market after all that time, and what does it mean for the Huddersfield property market?

 

You would have needed to have been living in a cave since the end of Lockdown No.1, not to realise the property market has been on fire in Huddersfield (and the UK as a whole) for the last 18/20 months.

 

It has been very much a seller’s market, especially in 2021. Yet as we enter the second quarter of 2022, I have noticed a slight rebalancing of the Huddersfield property market, more towards buyers, something that is good news for everyone (sellers and buyers) locally.

 

In 2020, it took on average 73 days from the average Huddersfield property appearing on the property portals (i.e. Rightmove, Zoopla etc.) to the property going sold (STC).

 

Interesting when compared to the national average of 72 days in 2020. Yet, last year, this was reduced to 43 days in Huddersfield (51 days nationally).

 

So, what's the issue with the Huddersfield property market being on fire?

 

Well, that was last year, and things have changed slightly since.

 

Of the properties for sale in Huddersfield, 24.7% of houses

have been on the market for more than 12 weeks.

 

That doesn't sound a lot, yet that is an eternity in this market!

 

So, why are there so many properties on the market in Huddersfield still for sale after all this time … it usually comes down to one thing … the practice of 'overvaluing'.

So before I explain what overvaluing is, let me give you some background.

 

Many agents (not just ourselves), in 2021, were achieving top prices for Huddersfield property with multiple offers becoming the standard. The property they were selling was only available to buy for days before the owner obtained multiple offers that were not only at a satisfactory level, yet more than they ever dreamed likely.

Although this was great news for Huddersfield homeowners, this caused fewer homes to come on to the market in the last six months in Huddersfield, as people were afraid to put their home on the market without having a property to buy.  

With fewer properties coming onto the market, some estate agents have become more and more desperate to get a larger slice of this smaller property market. It has seen an unwelcome side of the estate agency profession, the estate agency practice of ‘overvaluing’.

While ‘overvaluing’ is nothing new, the custom has been generally limited to a small number of estate agents. Yet now, it's become more prevalent and creates uncountable distress and pressure for some Huddersfield homeowners.

Many Huddersfield homeowners want to sell quickly to get the property of their dreams. Yet, in many cases, when they do put their property on to the market, they don’t sell quickly enough because of this ‘overvaluing’ (even with the fantastic current property market conditions).

To give you an idea of the issue …

72.5% of Huddersfield homes put on the market

in the last 30 days have not sold.

There are hundreds of Huddersfield families having their dreams dashed by 'overvaluing.'

Therefore, let me look at exactly what overvaluing is, why it’s on the rise and most importantly, the harm overvaluing causes to homeowners like yourself.

You would think the most important thing in estate agency is all about finding the best buyer for your home, at the best price, who can make the move with the least amount of hassle.

To us it is, and to many other Huddersfield estate agents, it is as well. Yet, to some agents, sales aren’t the essential objective. Instead, it is having a vigorous catalogue of properties to sell to generate more future leads.

Deprived of an endless number of new properties for sale, the enquiries estate agents receive will significantly drop, leaving them high and dry without any buyer (or seller) leads, the lifeblood of estate agents.

Therefore, some (not all), but some estate agents will feed on a homeowner’s appetite to get the highest possible price for their Huddersfield home by giving them an over-inflated suggested asking price to market their property at (i.e. ‘overvaluing’).

If one estate agent can get you an extra £30,000 for your

Huddersfield home, you will take it, won’t you?

 

The suggestion of pushing the asking price of your Huddersfield home for 10%, 15% even 20% could be seen by many as a temptation too good to miss. Yet once you are on the market, the agent is trained to slowly get you to reduce your asking price over a lengthy sole agency agreement.

The problem is that the home of your dreams might have sold by the time you reduced your price in 3 months. Also, Which reports in 2017 and 2019 proved you ended up getting less for your home when it did eventually sell (which means you lose money) and finally, the agents know homeowners perceive it’s a hassle to swap agents (which it isn’t).

But estate agents only get paid when they sell the house;

why do they overvalue?

Would it surprise you that some estate agency chains pay their staff a commission when they put the property on to the market, not when it sells? So, their team overinflate their suggested asking prices to get that commission.

Over the last 18 months, with the rising property market, there has undoubtedly been a valid reason for pushing the envelope on the asking price. Yet, if every house like yours is on the market or sold subject to contract at £300,000 to £320,000, yours isn’t going to achieve £355,000, let alone £375,000 – even in this market.

With 72.5% of Huddersfield homes still for sale after a month, the market is starting to level out and if you are keen to sell, then let me give you some advice.

Research has shown that if the asking price is initially set too high, it will be ignored by people surfing Rightmove and Zoopla.

 

(Come on, be honest – you have done that yourself haven’t you?)

 

When the property is eventually reduced because it has the stigma of being on the property market too long (begging the question from potential buyers that there may be a problem with the property itself hence no interest?), often when it does eventually sell, it will sell for less than what it would have done if it were priced correctly from day one (as per the two reports from Which in 2017 and 2019).

 

Of course, on the other hand, setting the asking price below its market value means potentially leaving money on the table needlessly – hence the need for a good agent.

 

Putting your Huddersfield home or buy-to-let investment up for sale at the right price from the beginning is the key to selling within the best time frame and for the best price to a serious and motivated buyer.

Ask a handful of estate agents to value your home, ask them to back up any valuation of your Huddersfield home with cold hard comparables of similar properties to yours.

 

Find your comparables by searching ALL the property portals (i.e. Rightmove, Zoopla, Boomin, OnTheMarket).

 

If you only take away one thing from this article, when you search the portals for comparables, make sure you include under offer/sold STC properties, as that will triple the comparable evidence. 

 

Thus, by doing your homework and then working with a dependable, trustworthy and experienced Huddersfield estate agent, who will help to ensure that your Huddersfield property is put on the market to get you, the homeowner, the best price from day one without over cooking it so you don’t lose out, you will be just fine.

 

These are my thoughts, let me know if you have any yourself.

 

How Will Rising Inflation Affect the Huddersfield Property Market in 2022?

 

The UK is currently experiencing its highest inflation rate since the early 1990s. This increase in prices has primally come about by the combination of an increase in demand for goods and services from consumers following lockdown last year together with global supply chain disruptions.

 

Most economists weren't too concerned about this increase in the inflation rate as the very same thing happened in the early 1990s following the Credit Crunch with a similar rise in demand and supply chain issues. Thankfully, back in the early 1990s, inflation returned to lower levels quite quickly. However, the situation in Eastern Europe now could change matters.

 

So, let me look at all the factors and what it means for the Huddersfield property market.

 

The crisis in Eastern Europe has sparked even further rises in crude oil (which diesel and petrol are made from), gas and grain prices as pressure on supply chains around the world increases.

 

In my previous articles, I suggested UK inflation would rise to around 7% in the spring and drop back to 5% in the autumn and as we entered 2023, be approximately 3% to 4%.

 

Yet, with these issues, inflation could rise to 8% to 9% by late spring and still be around 6% to 7% in autumn, well above the Bank of England's target of 2%.

 

With Huddersfield wages rising at only 3% to 4% and inflation at 7%+, Huddersfield household incomes, in real terms, will fall.

 

This is because ‘real’ UK household incomes characteristically have been the most consistent lead indicator of growth (or a drop) in house prices. This is because growing inflation erodes the value of money you earn, which reduces its buying power. When the cash in your pocket has a lower spending power, people tend to spend less when they buy (and rent) a home (and vice versa).

 

Next month, Income Tax thresholds will be frozen, and National Insurance contributions are increasing. Collectively, all these issues will create a drop of around 2% to 2.5% in the real disposable income of Britain's households in 2022 (real disposable income - somebody's take-home wages after tax and then the effects of inflation are considered).

 

Will Huddersfield people be more anxious to spend their money?

With less money in people's pockets, people's inclination to spend the money they do have could also be curtailed. People's savings are at an all-time high, yet many will decide to sit on the cash, instead of spending it, especially as consumer confidence has dropped to minus 26 on the GfK index (whatever that means – but in all seriousness though - more on that below).

 

All this can only mean there is going to be a house price crash.

 

It’s all doom and gloom! …Or is it?

 

My heart goes out to people caught up in the awful humanitarian crisis in Eastern Europe. Yet, I respectfully need to put that to one side for just a moment for the purpose of this article.

 

This blog is about the Huddersfield property market, and Huddersfield people want to know what will happen to the Huddersfield property market.

 

In the first half of the article, I looked at the impending fall in real disposable incomes of 2% to 2.5% in 2022. I appreciate it's going to be tough for many families in Huddersfield. Yet, it is always important to consider what has happened in previous times.

 

1982 – a drop of 2.3% in real disposable income

1992 – a drop of 3.7% in real disposable income

2008 – a drop of 5.8% in real disposable income

 

Yes, it's going to be tough, yet we got through 1982, 1992 and 2008 – and so we shall in 2022/23.

 

Next, the price of petrol is very high compared to a year ago.

 

The average price of unleaded petrol is £1.51/litre today, quite a jump from the £1.21/litre a year ago. But here is an interesting fact, petrol was a lot more expensive (in real terms) in 2011 than today. In TODAY's money, a litre of unleaded petrol in 2011 would be the equivalent of £1.79/litre. We have some way to go before we get to those levels – and again, the Huddersfield economy (and property market) kicked on quite nicely after 2011.

 

What are Huddersfield people spending

on their rent and mortgages?

 

Housing costs - owner occupiers were spending on average 17.3% of their household income on mortgages in 2015, yet in 2021 this had risen, albeit to 17.7% - not a huge increase.

 

Council house (social) tenants have seen a drop in their rent from 29.2% in 2015 to 26.7% in 2021, whilst private tenants from 36.4% in 2015 to 31.2% in 2021.

 

Interesting that private tenants are proportionally 14.29% better off in 2021 than in 2015.

 

How we spend our money - the average UK home spent 4.2% of their household income on energy in 2021, and that is due to rise to 6.3% after April (and probably 7% in October). Yet, as a country, we spend 9% of our income on restaurants and hotels and 8% on recreation and culture. As with all aspects of life, it will mean choices, and maybe we will have to forego some luxuries?

 

Just before I move on from this aspect of the article, again I appreciate I am talking in averages. Many people with low incomes suffer from fuel poverty and they will find the increases in energy prices hard - my thoughts go out to you.

 

Interest rates - higher inflation is generally brought under control using higher interest rates, meaning mortgage payments will

be higher.

 

First, 79% of homeowners with a mortgage are on a fixed rate, so any rise won't be instantaneous. Yet, there will be a bizarre side effect from the issues in Eastern Europe. Surprisingly, though the current situation in Eastern Europe, by its very nature, will bring greater UK inflation, it will also probably defer the Bank of England raising interest rates. This means mortgage rates won't increase as much as the bank won't want to exacerbate any pressures to the UK economy in 2023/24 caused by the conflict.

 

The stock market had priced an interest rate rise to 2% by the end of 2022. I suspect this will now be no more than 1% to 1.25% by Christmas, slowly going up in quarters of one per cent every few months. The crisis in Eastern Europe might even come to be seen as a defence for higher inflation throughout 2022, all meaning everyone's mortgage will be less.

 

Next, looking at Consumer Confidence Indexes - these indexes are fickle things. I prefer to look at the Organisation for Economic Co-operation and Development Consumer Confidence Index as it has a larger sample range and a longer time frame to compare against. Looking at the data from the mid 1970s, the drop in consumer confidence is big, yet nothing like the drops seen in the Oil Crisis of the mid 1970s, Recession of the early 1980s, ERM crisis of 1992 and the Global Financial Crisis of 2008/09. Also, when compared to the other main economies of the world (G7), the UK has always bounced back much more quickly from recessions when it comes to consumer confidence.

 

What about house prices in Huddersfield in 2022/23?

 

Increasing energy prices, rising inflation, an increase of sanctions, and a probable drop in consumer confidence and spending in the aftermath of the conflict will knock the post-pandemic recovery globally, which will lead to a recession around the world, including the UK.

 

A recession is when a country’s GDP drops in two consecutive quarters. For the last 300 years, there has been a direct link between British house prices and GDP - (i.e. when GDP drops, UK house prices fall). Yet in 2020, the British GDP dropped by nearly 12%, yet house prices went the other way. 

 

But let’s look at what would happen if Huddersfield house prices did drop by the same extent they did in the Global Financial Crisis of 2008/09.

 

House prices in Huddersfield dropped by 17.5% in the Global Financial Crisis, the biggest drop in house prices over 16 months ever recorded in the UK.

 

The average value of a property in Kirklees

today is £177,532.

 

Meaning if Huddersfield's house prices dropped by the same percentage in the next 16 months, an average home locally would only be worth £146,463.

 

On the face of it, not good - until you realise that it would only take us back to Huddersfield house prices being achieved in May 2020 - and nobody was complaining about those.

 

Yes, that will mean if they do drop in price, the 5.3% of Huddersfield homeowners who have moved home since May 2020 would lose out if they sold after that price crash. But how many people move home after only being in their home for a couple of years? Not many!

 

The simple fact is that 94.7% of Huddersfield homeowners will be better off when they move if house prices crash.

 

And all this assumes there will be a crash.

 

The simple fact is, the circumstances of 2009 that caused the property crash are entirely different to 2022 (no lending by the banks, higher interest rates and increasing unemployment compared to today’s increased lending, ultra-low interest rates and low unemployment environment).

 

I do believe with all that's happening in the world we might see a rebalancing of the Huddersfield property market later in 2022 and could see the odd month with little negative growth in house prices, yet it will be nothing like 2009.

 

The expected fall in household spending could be counterbalanced by UK businesses’ plans to invest more in their businesses (with last year’s tax breaks on investing), which will create even more jobs.

 

Who knows what the future holds? These are just my opinions - what are yours?

1 in 45 homes are sitting empty in the Huddersfield area

·         4,174 homes in the Kirklees area are empty, which represents 1 in 45 homes.

 

·         2,426 of those have been empty for more than six months and are worth £431million.

 

·         Why are those properties standing empty and deteriorating and why could that become an issue for the whole of Huddersfield?

 

A couple of weeks ago was National Empty Homes Week, so I thought I would find out how many homes are empty in the Huddersfield area – the numbers surprised me, so I wanted to share my thoughts about them with you.

The latest Government statistics show that 2,426 properties

in Kirklees have been empty for more than six months.

 

Homes that are left empty for an extended period can affect our locality and occasionally invite anti-social behaviour.

With a shortage of housing in the Huddersfield area, these empty homes must be brought back into use to generate much-needed housing for local people.

As you can see in the first bullet point, some homes are only empty for a short period of time. Yet, those local properties that stand empty for more than six months and then deteriorate become a problem for our local community.

I appreciate there can be many genuine explanations why a property may be left empty for a long time. However, with council house waiting lists at high levels and the shortage of both properties to buy and rent in Huddersfield, we must ask what is being done about this at Government level and how this could affect the Huddersfield property market?

The collective value of these 2,426 long-term (6 months or more)

empty houses in Kirklees are worth £431million.

This impacts the Huddersfield housing market with a lack of properties coming onto the market for sale and rent. This results in house prices being pushed up, making it less affordable for first-time buyers to get on the first step of the housing ladder.

It’s a real shame that many local properties are empty for over six months when there is an increasing demand for accommodation, at a time when there’s such a competitive housing market.

So, one might ask if this issue of long-term empty properties is a new problem? Well, not really.

There were 3,696 homes long-term empty in Kirklees in 2010.

 

I know our local authority likes to work with property owners of empty homes to bring them back into housing stock as it helps with the housing shortage, even with the help of grants if improvement work is needed for the empty home. Yet, they could use enforcement action where a homeowner is incapable or unwilling to bring their property back into use.

 

So, what is the Government doing nationally? Homeowners are charged a 50% premium on top of their Council Tax if their home has been empty for two years or more. This can rise to a 300% premium if the property has been empty for ten years or more.

 

However, the bigger question is, why are all these homes in the Huddersfield and Kirklees area being left empty?

 

The real answer is - they are not.

 

A handful of the properties belong to the local authority and are in poor condition because the tenant trashed the property. 

 

Probate (where the person's estate is put in order and passed onto the beneficiaries of the will) takes between six and twelve months. Most of these long-term properties are being modernised and renovated, whilst other Huddersfield properties are part of a deceased estate. In other circumstances, some Huddersfield homes have been left empty after the owner has been placed into a care home, yet there is no Power of Attorney to put the home onto the market. 

 

There is no 'one fix all' to the empty home syndrome in Huddersfield.

 

Empty properties in Huddersfield is not an issue that will sort the housing crisis we are suffering from.

 

The simple fact is the population is growing faster than the number of houses being built. We need to build more homes.

 

Whether that means council properties, housing association homes, private landlords or even owner-occupation housing the masses - that's a massive question we could all talk about, day in day out until the cows come home.

 

So, tell me, what are your thoughts on the matter?