Video 21/30 - 7 Top Tips to Refinance Your Investment Property Like a PRO!

I have purchased rather a few properties in the last few years, all of which I have added substantial value to. Naturally it's key to refinance in order to take some of that newly created equity out. I thought I'd share 7 Top Tips with you, so here we go!

Remember - if you're looking to acquire an investment property and you need help, drop me a line and let's start the conversation. Whether you would like to have me help you acquire your next property or whether you would like a more hands-off investment, there's never been a better time than now to enter the market. I am currently fundraising for further projects so if you have savings in the bank that are not earning enough get in touch to see how you can earn 10x returns.

All done and LET at £3225pcm - East Surrey Grove SE15

Well another successful refurbishment has been completed, and it's about time I tell you a bit more about it.

This particular property was much unloved, as you probably noticed in the previous video I did when I acquired it. Good news, the refurb is complete and went without any hitches; completed largely on time and no snags worth mentioning at all! Best yet, I had a group of tenants waiting to move in as the builders removed their tools on their last day because they had missed out on the last refurbishment project I did in Peckham.

So here are a few before and after pictures to wet your appetite. 

Look at the complete video here.

I am currently raising further funds for my next project in the pipeline. Are you looking to increase returns on your savings through passive investment in one of my projects? Perhaps you are looking to learn how to invest for yourself? Get in touch: jeroen@claphampropertyblog.com!

7 Reasons Why Clapham Buy To Let Landlords Shouldn’t Be Criticised

There is no escaping the fact that over the last couple of decades, the rise in the number buy to let properties in Clapham has been nothing short of extraordinary. Many in the “left leaning” press have spoken of a broken nation, the fact many youngsters are unable to buy their first home with the rise of a new cohort of younger renters, whom have been daubed ‘Generation Rent’ as landlords hoover up all the properties for their buy to let property empires. Government has been blamed in the past for giving landlords an unfair advantage with the tax system. It is also true many of my fellow professionals have done nothing to avail themselves in glory, with some suspect, if not on some rare occasions, downright dubious practices.

Yet has the denigration and unfair criticism of some Clapham landlords gone too far?

It was only a few weeks ago, I read an article in a newspaper of one landlord who had decided to sell their modest buy to let portfolio for a combination of reasons, one of which being the new tax rules on buy to let that were introduced last year. The comments section of the newspaper and the associated social media posts were pure hate, and certainly not deserved.

Like all aspects in life, there are always good (and bad) landlords, just like there are good (and bad) letting agents ... and so it should be said, there are good tenants and in equal measure bad tenants. Bad letting agents and bad landlords should be routed out … but not at the expense of the vast majority whom are good and decent.

But are the 2165 Clapham (or SW4 to be exact) portfolio buy to let landlords at fault?

The Tories allowed people to buy their own Council house in the 1980’s, taking them out of the collective pot of social rented houses for future generations to rent them. Landlords have been vilified by many, as it has been suggested by some they have an unhealthy and ravenous avarice to make cash and profit at the expense of poor renters, unable to buy their first home. Yet, looking beyond the headline grabbing press, this is in fact ‘fake news’. There are seven reasons that have created the perfect storm for private renting to explode in the 2000’s.

To start with, the Housing Acts of 1988 and 1996 gave buy to let landlords the right to remove tenants after six months, without the need for fault. The 1996 Act, and its changes, meant banks and building societies could start to lend on buy to let properties, knowing if the mortgage payments weren’t kept up to date, the property could be repossessed without the issue of sitting tenants being in the property for many years (even decades!) ... meaning in 1997, buy to let mortgages were born… and this, my blog reading friends, is where the problem started.

Secondly, in the early 2000’s, those same building societies and banks were relaxing their lending criteria, with self-certification (i.e. you did not need to prove your income), mortgages 8 times their annual salary, and very helpful interest only mortgage deals helped to keep repayments inexpensive.

Thirdly, the totally inadequate building of Council Houses (aka Local Authority Housing) in the last two decades and (so I’m not accused of Tory bashing) - can you believe Labour only built 6,510 Council Houses in the WHOLE OF THE UK between 1997 and 2010? Giving the Tories their due, they have built 20,840 Council Houses since they came to power in 2010 (although still woefully low when compared the number of Council Houses built in the 1960’s and 1970’s when we were building on average 142,000 Council Houses per year nationally). This meant people who would have normally rented from the Council, had no Council House to rent (because they had been bought), so they rented privately.

And then 3rd, 4th, 5th, 6th and 7th …

• Less of private home building (again look at the graph) over the last two decades.
• A loss of conviction in personal pensions meaning people were looking for a better place to invest their savings for retirement.
• Ultra-low interest rates for the last nine years since the Credit Crunch meaning borrowing was cheap.
• A massive increase in EU migration from 2004, when we had eight Eastern European countries join the EU. That brought 1.4m people to the UK for work from those countries – and they needed somewhere to live.

Thus, we got the perfect storm conditions for an eruption in the Clapham Private Rented Sector.

Commercially speaking, purchasing a Clapham property has been undoubtedly the best thing anyone could have done with their hard-earned savings since 1998, where property values in Clapham have risen by 394.4%...

…and basing it on the average rental in Clapham, earned £476,928 in rent.

Yet, the younger generation have lost out, as they are now incapable to get on the property (especially in Central London).

The Government have over the last few years started to redress the imbalance, increasing taxes for landlords, together with the Banks being tighter on their lending criteria meaning the heady days of the Noughties are long gone for Clapham landlords. In the past 20 years, anything but everything made money in property and it was easy as falling off a log to make money in buy to let in Clapham – but not anymore.

Being a letting agent has evolved from being a glorified rent collector to a trusted advisor giving specific portfolio strategy planning on each landlord’s buy to let portfolios. I had a couple of instances recently of a couple of portfolio landlords, one from Herne Hill who wanted income in retirement from his buy to let’s and the other from Chelsea, who wanted to pass on a decent chunk of cash to his grandchildren to enable them to buy their own home in 15/20 years’ time.

Both of these landlord’s portfolios were woefully going to miss the targets and expectations both landlords had with their portfolios, so over the last six/nine months, we have sold a few of their properties, refinanced and purchased other types of Clapham property to enable them to hit their future goals (because some properties in Clapham are better for income and some are better for capital growth) ... And that my blog reading friends is what ‘portfolio strategy planning’ is!

If you think you need ‘portfolio strategy planning’, whether you are a landlord of ours or not (because the Chelsea landlord wasn’t) ... drop me line or give the office a call. Thank you for reading.

Do let me know if you are looking to invest and you could use a hand. if you are a ready and able investor sign up to my list that will bring packaged deals to your inbox! If you are looking for no-obligation advice then drop me a line and let's start the conversation.

2.6% Drop in the Clapham and Lambeth Property Market

The number of residential property transactions in Lambeth will be 2.6 per cent lower in 2018, compared to 2017.

According to my research, the seasonally adjusted statistics for our local authority area suggest with the number of properties already sold in 2018, and the number of properties currently under offer or sold subject to contract (allowing for property sales to fall through before exchange of contracts) we, as an area, will end the year 2.57 per cent lower compared to 2017.

So why are transaction numbers so important to Clapham homeowners, Clapham landlords and potential first-time buyers?

Many economists and property market commentators believe transaction numbers give a more precise and truthful indicator of the health of the property market than just house values. In the six years before the Credit Crunch in 2007/8, the average number of completed property transactions in the local area (the local authority covered by Lambeth) stood at 5,896 per year .. yet in the three years following the Credit Crunch, on average, only 3,147 homes were changing hands per year in the area.

Roll the clock forward to more recent times and last year, in 2017, 3,827 homes changed hands (i.e. transacted and sold) in the area, not far off the local authority’s 23 year overall average of 4,861 homes per year.

In the past, a reduction in the number of properties selling has often been believed to be the first signal of a down turn in the housing market as a whole. Although, the down turn of the credit crunch years (2007/2008) was more a free-fall than a subtle down turn. Look at the graph and the ‘so-called’ halcyon days of the 2000 to 2006 property market were a roller coaster when it came to the number of transactions. House prices were rising in the six/seven years before the credit crunch (2000 to 2006), albeit, the rate of growth of Clapham house prices did slow in late 2005 and 2006 (which does fit in nicely with the graph).

In other articles, I have mentioned the change in the number of houses for sale today compared to last year and further back. Although, the market has seen in recent months (i.e. the short term) an increase in the number of properties for sale, fundamentally, in the medium term, there has been an underlying trend in the reduction of properties coming onto the market for sale in Clapham (and nationally) and this has been one of the main drives behind the lack of properties selling .. Clapham people aren’t moving as much as they were 30 years ago meaning fewer houses are selling each year.

However, this short-term increase in properties for sale hasn’t been even across the board. In certain sectors of the Clapham property market, there is a glut of properties on the market at the moment and so prices and values are dropping on those types as sellers compete for the limited amount of buyers… yet, there are other sectors of the Clapham property market where there is a dearth, a shortage of property, and buyers are fighting tooth and nail with silly offers to try and secure the sale. This means, there are some bargains for you Clapham buy to let landlords. If you look hard enough, you could spot the same trends I have seen in Clapham and find the individual property micro markets that fall into that first sector (with its glut).

So, if you want the inside track on the Clapham property market, whether you are a landlord of ours or another agent, I am more than happy to guide you in the right direction if you drop me a line or an email (contacts details are easily found on this page – and I don’t bite or do hard sell – promise!).

So, to conclude, I believe we will finish on 3,729 housing transactions by the end of the year in the area .. not too far off last year’s figure. Looking at the short term future, now it’s true some (not all) but some potential purchasers of property in Clapham may be exhibiting more caution because of concerns that the Bank of England will continue to put up interest rates– to which I reply – yes of course they will when they are only ultra-low at 0.75%. Anyway, that is the reason why 90%+ of new mortgages over the last nine months have been on a fixed rate. Also, if they do go up a few percentage points – they are nothing compared to the 12%, 14%, even 15% mortgage rates many of my landlords saw in the early 1990’s.

We can all speculate (and I appreciate the irony of that as I write this article) but all I say to any Clapham landlords, Clapham homeowners or Clapham first time buyers is act according to your own life cycle, budget on a modest increase in interest rates in the coming few years (yet protect yourself by fixing it), consider your own circumstances and finally, what you can afford.

Do let me know if you are looking to invest and you could use a hand. if you are a ready and able investor sign up to my list that will bring packaged deals to your inbox! If you are looking for no-obligation advice then drop me a line and let's start the conversation.

76 Days to Sell a Property in Clapham

Whether you are a Clapham landlord looking to liquidate your buy to let investment or a homeowner looking to sell your home, finding a buyer and selling your property can take an annoyingly long time. It is a step-by-step process that can take months and months. In fact, one of the worst parts of the house selling process is the not knowing how long you might be stuck at each step. At the moment, looking at every estate agent in Clapham, independent research shows it is taking on average 76 days from the property coming on the market for it to be sold subject to contract.

But trust me ... that is just the start of a long journey on the house selling/buying process. The journey is a long one and therefore, in this article, I want to take you through the standard itinerary for each step of the house selling procedure in Clapham.

Step 1 – Find a Buyer

You need to instruct an estate agent (of course we can help you with that) who will talk through a marketing strategy and pricing strategy to enable you to find a buyer that fits your circumstances. 76 days might be the average in Clapham, yet as I have said many times, the Clapham property market is like a fly’s eye, split up into lots of little micro markets.

Looking at that independent research, (which only focused on Clapham), it was interesting to see how the different price bands (i.e. different micro markets) are currently performing, when it comes down to the average number of days it takes to find a buyer for a property in Clapham.

Interestingly, I thought I would see which price band had the highest proportion of properties sold (stc)... again – fascinating!

So, now you have a buyer ... what next?

There are a variety of distinctive issues at play when selling your property in Clapham, together with the involvement of a wide and varied range of professionals who get involved in that process. That means there is are enormous differences in how long it takes from one property to another. Moving forward to the next steps, these are the average lengths of time it takes for each step to give you some idea of what to expect.

Step 2 - Sort Solicitors (and Mortgage)

Again, something we can point you in the right direction to, but it will take a good few weeks for your buyer to apply and sort their mortgage and for your solicitors to prepare the legal paper work to send to the buyer.

Step 3 – Legal Work and Survey

Once you buyer’s solicitor receives the paperwork from your solicitor, then your buyer’s solicitor applies for local searches from the local authority (to ensure no motorways etc., are going to be built in the back garden!). These Searches can take a number of weeks to be returned to the buyer solicitors from the council, from which questions will be raised by the buyer’s solicitor to your solicitor (trust me – you don’t see a tenth of the work that goes on behind closed doors to get the sale through to completion). Meanwhile, the surveyor will check the property to ensure it is worth the money and structurally sound. Overall, this step can take between 3 and 6 weeks (sometimes more!).

Step 4 – Exchange of Contracts

Assuming all the mortgage, survey and legal work comes back ok, both the buyer and solicitor sign contracts, the solicitors then perform “Exchange of Contracts”. When contracts are exchanged, this is the first time both buyer and seller are tied in. Before then, they can walk away ... and you are probably 4 or 5 months down the line from having put up the for sale board – this isn’t a quick process! BUT hold on ... we aren’t there yet!

Step 5 – Completion

Between a week and up to six weeks after exchange of contracts, the buyer solicitor sends the purchase money to the seller’s solicitor, and once that arrives, the keys will be given to the buyer … phew!

To conclude, all in all, you are looking at a good four, five even six months from putting the for-sale board up to moving out.

If you are thinking of selling your Clapham home or if you are a Clapham landlord, hoping to sell your buy to let property (with tenants in), either way, if you want a chat to ensure you get a decent price with minimal fuss ... drop me a message or pick up the phone.

Do let me know if you are looking to invest and you could use a hand. if you are a ready and able investor sign up to my list that will bring packaged deals to your inbox! If you are looking for no-obligation advice then drop me a line and let's start the conversation.