648% - Rise in Runcorn Property Prices since 1981
Wed 28 Sep 2016
Helen Pass BSc (Hons), Director
Roll the clock back 35 years to 1981, and Mrs. T was in power, we had a Royal Wedding, Britain won the Ashes and Bucks Fizz won Eurovision with ‘Making your Mind up’ (I was only 7 but can remember it well). Haven’t things changed. The number of homeowners and property investors who said they wish they had hindsight and bought up every house in Runcorn all those years ago, especially when you consider what has happened to Runcorn property values, as…
Runcorn Property Values since 1981 have risen by 648%.
Not bad when you consider inflation over the same time period has been 271.9%, meaning in real terms (i.e. after inflation), property values in Runcorn are 376.1% higher. It’s no wonder people can’t afford to buy property anymore and landlords are attracted by bricks and mortar. Yet the changes to the Runcorn Property market run much deeper than property value changes as no one could have predicted how the property market has changed in Runcorn over the last 30 years.
Looking at the Local Authority data for Halton Borough Council in 1981, 53.2% of Runcorn people lived in a Council House, whilst today its 25.2% ... a massive drop which can mostly be attributed to Margaret Thatcher allowing Council tenants the right to buy their Council House. The private rental sector since 1981 has, as one would have expected, also changed. The proportion of properties privately rented in the Runcorn area (i.e. through a private landlord or a letting agency) has more than doubled, rising from 4.1% to 9.8% of property.
So, let us consider those people who own their own home, surely that has had a massive drop? In 1981, the proportion of people who lived in the Halton Borough Council area who owned their own home was 42.6% … and today its … 63.4%. Not the seismic change most of you were expecting (including myself!).
Homeownership in the 1980’s and 1990’s in Runcorn did in fact rise, but as I have discussed in previous articles in the ‘Runcorn Property Blog’, that was because nearly every Council tenant was buying their council house. Now there are not as many housing association houses for the younger generation to move into (because of the right to buy scheme) so they have no choice but to privately rent.
.. and this is why the buy to let market in Runcorn is an investment sector that will continue to grow as councils aren’t building council houses in their thousands each year (like they were in the 1950’s/60’s and 70’s). The Runcorn property market is constantly changing and buy to let for too long has been heavily dependent on house price growth, where yield has been almost forgotten. I see the changes in tax and landlord and tenant law in a different perspective to the sooth-sayers and see it as bringing many opportunities where yield will become more important.
Like Bucks Fizz said in their song, it’s time to make your mind up. The advice I give to my landlords, and also to you my blog reading friends is this; these changes will make some landlords panic, meaning competition for decent Runcorn buy to let bargains will reduce as fear of change kicks in and amateur investors flee the market. These opportunities will provide a more stable platform for knowledgeable and wise Runcorn buy to let landlords to thrive in.
If you’re interested in investing or have already invested in the Runcorn property market and want to discuss maximising your investments, pop in for a coffee at 60A High Street, Runcorn, WA7 1AW or visit our website www.homesmartlettings.com