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New data reveals opportunity for first time buyers to outperform housing market

New data reveals opportunity for first time buyers to outperform housing market

Recent data has revealed that First-time buyers in the UK need an average income of £54,000 in order to buy a property, marking a 9% rise from 2016 when Britain decided it would leave the European Union.

Looking at the data released from property website Zoopla this month, it’s fair to say that Millennials have had something of a raw deal when it comes to their finances. From soaring house prices, inflation exceeding earnings, through to political and economic uncertainty with Brexit – getting onto the property ladder has never been more difficult.
Those wanting a start on the housing ladder will often face a never-ending stream of negativity, with many believing it’s near impossible to buy their first home as they cannot raise enough money. This has created a new opportunity for first time buyers to act more savvy and  to selectively invest in Buy to Let property in national growth locations.
Data released by Zoopla found that the average household income required to buy in London was £84,000. In Liverpool, which had the lowest required household income before tax of the 30 cities surveyed, it was just £26,000.
Current house prices are encouraging huge rental demand in the UK’s busiest cities with young professionals flocking to areas like Manchester, Birmingham, Newcastle and Liverpool. Purchasing a one or two bedroom apartments as a Buy to Let in these locations is a shrewd investment for those priced out of their home town or city.

“The world as we knew it has changed when it comes to property ownership. We’re seeing more people renting and for longer periods, but that doesn’t mean that they need be denied the opportunity to profit from property. It’s just that doing so may look different in the future. Property investment companies need to work with Millennials to encourage that to happen.”

Jonathan Stephens, MD, Surrenden Invest
While Liverpool was named the most affordable market for first-time buyers, it was also the city with the highest house price growth, with values rising 5% over the 12 months April to April.
The Tannery is one of Liverpool’s most iconic residences. The elegant exterior sets the tone for the graceful, stylish homes inside, bringing capital-quality residences to Liverpool’s renters. The low entry price of just £85,000, coupled with 6% NET yields and long term capital growth projections make The Tannery highly appealing to investors looking to either bolster or begin their portfolios with one of the most exciting new opportunities of 2019.

For regular updates on investing in Liverpool and other key UK regional cities, follow the Surrenden Invest team on social media.

The investment case for Luton

The investment case for Luton

Luton is a growing town that is known for being one of London’s most sought-after commuter locations. Indeed, Jackson-Stops has just flagged it up as the top commuter hotspot for 2019 and the town is fast becoming a favourite with property investment companies. Here’s why.

Luton is located 30 miles north west of central London. Direct trains run into London St Pancras International in as little as 22 minutes. 167 trains per day provide an almost round-the-clock service. Rents, meanwhile are around 1/3 of the cost that they are in London. For renters, it is the ideal combination.
Not only that, but London Luton Airport (the fifth largest in the UK and the fastest-growing major London airport) provides the town with easy, fast access to a wide range of European destinations, as well as select locations in Africa and the Middle East.

“Life in Luton means easy access to the best that London has to offer but without the capital’s extortionate housing costs. The town has excellent amenities with a lively local culture that appeals to those looking to balance access to London with a realistic lifestyle. This is one of the reasons that Luton exhibits such excellent growth potential.”

Jonathan Stephens, MD, Surrenden Invest
Luton’s population is increasingly rapidly. Between 2018 and 2041, the Office for National Statistics projects that the town’s population will grow by 12.9%, to 248,500. At the same time, it is in the grips of a serious housing shortage, as is the case with many towns and cities in the UK. However, Luton’s housing shortage is worse than most, with Project Etopia projecting that it will be 22.1 years behind where it needs to be in terms of housebuilding by 2026, if the current rate of development continues. At present, Luton is building 430 new homes per year – it needs to be building 1,417 to meet demand.
This housing shortage spells good news for buy to let investors, as it points to a long-term, sustained level of demand for private rented accommodation in Luton, as tenants seek to snap up those homes that are available. It also has the potential to drive up house prices (as well as rents and yields). Luton is already bucking the trend in terms of house price rises. While many southern locations are seeing a market correction at present, with falling prices or nil growth, Luton’s prices rose by 1.6% in the year to April 2019. Savills, meanwhile, projects growth of 9.3% in the five years to 2023 for the South East region.
In terms of its rental market, Luton enjoys an average rent of £632 pcm for a one-bedroom apartment and £828 pcm for a two-bedroom one, according to Zoopla – significantly less than equivalent homes in London.

“It is Luton’s combination of capital growth potential and pent-up demand for private rented sector homes that has caused the town to top LendInvest’s UK buy to let index for so much of the past three- or four-year period. This is a town with outstanding growth potential. Watch this town and watch this space to take full advantage of what Luton has to offer in the very near future!”

Jonathan Stephens, MD, Surrenden Invest

For regular updates on investing in UK buy to let hotspots such as Luton, follow Surrenden Invest on social media.

Is property investment the key to retirement for Millennials?

Is property investment the key to retirement for Millennials?

It’s fair to say that Millennials have had something of a raw deal when it comes to their finances. According to Brookings, median household wealth for Millennials in 2016 was 25% below that of those who were a similar age back in 2007. The global financial crisis has held them back in terms of salary growth, but it’s far from the only factor. Growing levels of student debt have played a large role, as has an inability to climb onto the housing ladder.

The result is that Millennials are facing a number of issues, both in terms of current wealth creation and future prospects. Not owning property means no capital growth. The increasing prevalence of self-employment more often than not means a lack of savings for retirement. Interestingly, though, this doesn’t mean that Millennials are unable to use the property market to their advantage.

“Millennials face a number of economic hurdles, but property investment doesn’t have to be one of them. The average UK property costs eight times the average salary, according to the ONS, but the right buy to let home in the right area can cost considerably less. It can also generate a healthy income, as well as the potential for capital growth.”

Jonathan Stephens, MD, Surrenden Invest
The Tannery, in Liverpool, is a key example of the potential that property investment holds for Millennials. The apartments are available from just £85,000 – far below the UK average property price of £226,798 (Land Registry figures, March 2019). With a turnkey management solution in place, there is no burden placed on investors in terms of time, meaning that Millennials looking for an alternative to traditional pension arrangements would do well to consider such a property’s potential.
Buy to let mortgages are subject to affordability checks, just as mortgages for first time buyers are. They also consider the potential rental income of the property in question. Surrenden Invest’s mortgage calculator is a great place to start for those just looking into this (whether Millennials or not).

“The world as we knew it has changed when it comes to property ownership. We’re seeing more people renting and for longer periods, but that doesn’t mean that they need be denied the opportunity to profit from property. It’s just that doing so may look different in the future. Property investment companies need to work with Millennials to encourage that to happen.”

Jonathan Stephens, MD, Surrenden Invest

For regular updates on investing in property UK regional cities, be sure to follow the Surrenden Invest team on social media.

Luton’s dynamic business environment and what it means for investors

Luton’s dynamic business environment and what it means for investors

Luton is a large town in Bedfordshire, some 29 miles northwest of London. It has a diverse economy that has built on the town’s industrial past while embracing new sectors and technologies. This exciting business environment, combined with the town’s affordability and proximity to London, is causing investors to look closely at Luton right now – so that’s precisely what we’ve done!

In terms of its business environment, Luton’s principal employers, after the borough council and Luton and Dunstable University Hospital NHS Foundation Trust, are those whose businesses relate to aviation: Aircraft Service International Group, EasyJet, Menzies Aviation, TUI and more all employ between 1,000 and 2,000 people. The University of Bedfordshire is also one of the town’s notable employers, with a similar number of staff.
As well as the aviation industry, Luton has a thriving new enterprise scene. So much so, in fact, that the town ranked fourth in the Lambert Smith Hampton UK Vitality Index in 2018 – the first time it had been included in the report. Lambert Smith Hampton analysed 66 towns outside of London in order to identify those that provide the greatest opportunities for businesses expansion and are best positioned for growth.

“It’s great news to see Luton ranking in The Vitality Index’s Most Entrepreneurial list for the first time and it’s testament to the inward investment that it is attracting, as well as the commitment to improving the local economy.”

Lloyd Spencer, Head of Office for LSH Milton Keynes and Luton
Luton ranked highly due to its supportive business environment and high number of new enterprises per capita (it had the highest number out of all 66 locations). London Luton Airport Enterprise Zone – one of only a couple of dozen enterprise zones in the UK – played a key part in the ranking. The enterprise zone, which was announced in late 2015, has attracted more than £1.5 billion in private sector investment, creating thousands of jobs and driving forward a programme of local infrastructure enhancements.

“What we’re seeing in Luton is a town that already has a busy economy thanks to the presence of London Luton Airport, but one where entrepreneurial spirit is flourishing as well. For buy to let property UK investors, this is excellent news, as Luton has all the right elements to draw in bright, talented young professionals and thus fuel demand for centrally located rental homes.”

Jonathan Stephens, MD, Surrenden Invest
Those founding their own companies are benefitting from Luton’s enterprise zone effect. The June 2018 Luton Gross Disposable Household Income report, from Luton Business Intelligence, reveals that earnings from self-employment have risen in relation to the national average in recent years, as the town’s entrepreneurs play their part in its economic success.
Not only is Luton well regarded for its entrepreneurial credentials, the town also ranks highly when it comes to environmental issues. The UK Vitality Index placed it fourth in its top ten greenest locations ranking, with Luton performing well in areas such as CO2 emissions per capita, energy consumption and household recycling.
Those looking to capitalise on Luton’s superb market fundamentals are invited to consider The Orion. Just minutes from Luton station and town centre, the development is ideally positioned for those commuting into London, as well as those working in Luton itself. The one- and two-bedroom apartments have been designed with luxury firmly in mind, with high specifications that will appeal to tenants looking for contemporary homes in a great location. Prices start from £172,900, which is 10% below the value of comparable homes on the market.

To find out more about investing in Luton and other UK regional locations, be sure to follow the Surrenden Invest team on social media.

Location focus: London Luton Airport Enterprise Zone

Location focus: London Luton Airport Enterprise Zone

London Luton Airport is the fifth busiest airport in the UK, according to Inside Flyer, with more than 15 million passengers passing through its terminals. Luton is also the UK’s leading business aviation airport, and one of the top three business aviation airports in Europe. Leading businesses including Gulfstream, Harrods, Signature Flight Support and Landmark Aviation all have a significant presence there.

Luton’s airport is the cornerstone of the town’s economy, accounting for around 10% of overall employment in the area. In 2015 it was granted enterprise zone status by the government.

“Becoming an enterprise zone marked a new phase in London Luton Airport’s development, as well as in the development of the town itself. It signalled confidence in the unique capabilities that Luton has to offer and in its future potential.”

Jonathan Stephens, MD, Surrenden Invest
The enterprise zone incorporates three sites: Century Park and adjacent land; Airport Business Park and adjacent land and Stirling Place. The massive programme of work will include a £100 million road infrastructure scheme and the creation of a £200 million Mass Passenger Transport system that will connect the airport terminal directly with Luton Airport Parkway train station. Commercial offices and retail premises are also incorporated into the ambitious plans.
London Luton has a two-hour-drive catchment area that exceeds that of London Heathrow, at 23 million people. It contributes £1.3 billion annually to UK GDP and £648 million to the Treasury. Luton’s enterprise zone status means that the airport and its surrounding area can offer reduced business rates to new companies, as well as to existing businesses that are looking to grow and/or relocate.
The zone has been a catalyst for economic growth, drawing £1.5 billion of private investment into Luton. This has not focused solely on aviation but has created a wide range of opportunities – including in Luton’s property market, which has becoming increasingly attractive to buy to let property UK investors as the enterprising town has thrived.

“Luton is already an inviting investment prospect as a result of its affordability and excellent access to London. The influx of investment into the town, and the resulting regeneration of a number of local facilities – as well as the airport’s expansion – have made it an even more attractive proposition.”

Jonathan Stephens, MD, Surrenden Invest
London Luton Airport is currently undergoing the biggest expansion project in its history. The £160 million, three-year transformation will see passenger capacity increased to 18 million travellers by 2020 – an uplift of 50%. The airport’s redevelopment will see the addition of new boarding gates, a boarding pier and a host of retail outlets. The infrastructure enhancements will also include a new bus interchange, dual carriageway and multi-storey car park, making London Luton Airport even more accessible and traveller-friendly.

“This is a new era for LLA. We are the fastest-growing major London airport and are now in a position to play an increasingly important role in the UK’s aviation network.”

Nick Barton, CEO, London Luton Airport
Perfectly positioned to take advantage of it all, the beautifully designed apartments of The Orion are just a 10-minute drive from London Luton Airport. The one- and two-bedroom homes deliver luxury living within an easy commute from London (Luton railway station is just minutes away, providing direct trains into St Pancras in as little as 22 minutes).
Priced from £172,900 and with 6% net yield per annum assured, The Orion’s apartments provide an excellent opportunity for investors to be part of Luton’s rosy future and enjoy all the advantages that come with the airport’s designation as an enterprise zone.

For regular updates on investing in Luton and other London commuter belt destinations, follow the Surrenden Invest team on social media.

Business snapshot – let’s take a look at the Birmingham commuter belt

Business snapshot – let’s take a look at Dudley

The Metropolitan Borough of Dudley, to the North West of Birmingham, is a popular home for families looking to enjoy the perfect blend of suburban life and access to green space, while still enjoying all the economic opportunities that a thriving business environment can provide. The borough is home to over 100 business parks, making it a key player in the Black Country economy.

The power of a business park to support regeneration in an area is significant. Brierly Hill’s Waterfront Business Park is an excellent example. Home to over 20 companies, it offers a wide range of commercial properties to companies looking for well-designed and well-connected premises. Not only that, but those connections are shortly due to get a whole lot better, with Brierly Hill directly benefitting from the £449 million extension to the West Midlands Metro tram line.
Further regeneration work is also taking shape in the local area. Just two minutes from the site of the new Brierly Hill tram stop (due for completion by 2023) is Oak Court. The stylish apartments are largely one-bedroom homes, in line with current demand for rental homes in the local area. Designed to serve both the Dudley Borough and Birmingham rental markets, the apartments will offer spacious homes designed to meet the needs of professional tenants looking to enjoy a contemporary suburban lifestyle.

Oak Court is a particularly interesting development as investors have a chance to be involved in Brierly Hill at a very significant phase in the town’s history. The tramline extension, which will provide a rapid connection to central Birmingham, is opening up regeneration opportunities like never before. Coupled with the Borough of Dudley’s focus on business and economic opportunities, this is a location that will be of important regional significance over the coming decade and beyond, particularly for those with an interest in buy to let property UK prospects.”

Jonathan Stephens, MD, Surrenden Invest
Home to just shy of 320,000 people, the Metropolitan Borough of Dudley certainly punches above its weight when it comes to business opportunities. And with renters increasingly finding themselves priced out of central Birmingham, the borough is ideally placed to capitalise on the potential of its housing prospects as well.
Oak Court is ideally placed to benefit from all of these factors. It is situated within the heart of a £1 billion Enterprise Zone and is adjacent to the new £100 million Merry Hill Shopping Centre. Available from £82,000, homes at Oak Court offer rental yields of 7% with a full management programme in place. A short build time means that they will be ready for occupation from winter 2019.

To stay abreast of the latest developments in Brierly Hill and Dudley, follow the Surrenden Invest team on social media.

Brand new Luton development revealed

Brand new Luton development revealed

One of the most exciting times for a property investment company is finally being able to reveal a new development that you’ve been working on behind the scenes for the past few months. As such, the Surrenden Invest team were delighted to share details of The Orion in Luton with our community of investors earlier in May.

“It’s a great time to re-discover the London commuter belt in terms of its investment potential right now. Luton in particular has a clear investment case, which is why we have chosen it as the site for our latest development – The Orion. Providing stylish, spacious homes for professional tenants, The Orion is one of those developments where everything is just right, from the location to the design to the timing.”

Jonathan Stephens, MD, Surrenden Invest
The Orion is home to 67 luxurious apartments, comprising a mix of one- and two-bedroom homes, just a two-minute walk from Luton railway station. Due for completion in Q4 2020, the apartments are priced some 10% below comparable properties on the market.
Their location is a key feature of The Orion’s homes. Commuters can get from Luton to London St Pancras in as little as 22 minutes by direct train. Those travelling abroad, meanwhile, can connect to a range of international destinations at St Pancras, or undertake the 10-minute drive from The Orion to London Luton Airport in order to travel onward to Europe, Africa and the Middle East.

“The Orion will be Luton’s joint-tallest building once complete. The homes within will certainly befit this stature, offering high-end specifications designed with ambitious professionals in mind. Luton is in the grip of a sustained housing shortage, so these much-needed homes will be highly prized by local renters, whether they’re working in Luton itself or commuting into London.”

Jonathan Stephens, MD, Surrenden Invest
Luton’s house prices have grown by 1.6% over the past six months, despite price corrections in many parts of London and the surrounding area over the past year or two. Over the past five years, Zoopla reports a rise of 39.92%. The town’s affordability has been key to keeping its market buoyant. The average home there is priced at £239,800 – almost half of the London average of £473,822. At the same time, Luton’s rents are projected to rise by 8.9% over the coming five years, which is excellent news for those investing in Luton buy to let property.

If you would like to know more about investing in The Orion in Luton, or in other UK regional cities, be sure to follow the Surrenden Invest team on social media.

New Rental Market Snapshot keeps investors up to speed

New Rental Market Snapshot keeps investors up to speed

Here at Surrenden Invest we do all we can to make our property investment company stand out from the crowd. Part of that includes sharing the knowledge and market insights that we have with our community of investors. We believe that knowledge is a powerful thing and is essential in choosing the right investment opportunities at the right time. That’s why we’ve launched our Rental Market Snapshot Guide

“Whether you want an overview of the UK rental market as a whole or a concise, detailed look at some of the country’s leading cities, the Rental Market Snapshot is the ideal investment companion. Making money from buy to let property UK opportunities is all about achieving strong yields as well as the potential for healthy capital growth. Surrenden Invest delivers a range of resources to support this.”

Jonathan Stephens, MD, Surrenden Invest
The data-driven Rental Market Snapshot considers not just current rental prices in each of the major cities it covers (Birmingham, Manchester, London, Liverpool and Newcastle) but also a range of other market performance metrics. These include average tenancy lengths and void periods, as well as factors such as what proportion of renters end their tenancies early. All of these can impact on the rate of yield that buy to let investors can expect.
Wider market drivers such as the kind of properties that renters are seeking are also considered, as well as the growing relevance of the private rented sector as a whole.

“The UK rental market is a huge topic. What we’ve done with the Rental Market Snapshot is to capture the essence of the market as it stands today, while also exploring the historical factors that have led us to that point. We’ve looked forward was well as back, which is particularly important for investors who are currently looking at a range of cities for their next investment.”

Jonathan Stephens, MD, Surrenden Invest
Birmingham is one of the most exciting cities in the UK right now when it comes to buy to let investment. Surrenden Invest has been highly active there in recent years. Its latest – and most impressive – Birmingham development is No. 76 Holloway Head. The 34 luxurious apartments enjoy an outstanding B1 location, just two minutes from the Bullring, Grand Central and New Street Station. The swanky Mailbox retail destination, meanwhile, is almost on the doorstep. This ultra-prime location has been chosen in order to capitalise on the demand for true inner city living that’s at the heart of the action – one of the trends noted in the Rental Market Snapshot.

For regular updates on investing in the UK buy to let market, be sure to follow the Surrenden Invest team on social media.

Liverpool leads the way as regional cities buck the trend

Liverpool leads the way as regional cities buck the trend

The latest Hometrack UK Cities House Price Index has reconfirmed the strength of regional property markets, with Liverpool leading the pack. The March 2019 figures reveal a year-on-year price increase of 5.7% for the average Liverpool home, which is now priced at £122,100.

Regional cities are also leading the way when it comes to sales volumes, with Liverpool once more showing the rest how it’s done. While sales volumes in southern cities are languishing some 13% lower than in 2015, sales in Liverpool, conversely, are 19% higher than they were four years ago.

“Liverpool is the shining star when it comes to regional city performance right now. It’s enjoying a busy property market, which high sales volumes and rapidly rising prices – a great backdrop for investing in properties in sought-after locations.”

Jonathan Stephens, MD, Surrenden Invest
Nestled in the L3 postcode district, The Tannery is just such a property. The striking building’s architecture was inspired by the former leatherworks that gave the site its name. Available from £85,000, the contemporary apartments have been designed to capitalise on their prime location, with stylish interiors and high quality specifications due to attract professional tenants looking to be at the heart of the action in Liverpool.
This resurgence of city centre living has seen many regional cities enjoy rapid growth in recent years. Both Manchester and Birmingham continue to perform well, according to the Hometrack data. Manchester’s property prices increased by 5.1% in the year to March 2019, while Birmingham’s went up by 4.2%.

“While we’re seeing a slowing down of the housing market in some southern areas, the Midlands and regions further north continue to enjoy healthy property price growth and sustained demand from both buyers and renters. Many of our property investment UK opportunities in recent years have focused on these key regional markets, which have consistently delivered excellent results for those who have invested in them.”

Jonathan Stephens, MD, Surrenden Invest

For regular updates on investing in Liverpool and other key UK regional cities, follow the Surrenden Invest team on social media.

Manchester enjoys huge boom in residential development

Manchester enjoys huge boom in residential development

As a leading property investment company, Surrenden Invest has long had its corporate eye fixed firmly on Manchester. The city offers some excellent prospects for buy to let investors looking for strong returns. In fact, the whole of the North West is an attractive area for residential development investors, with HM Land Registry’s latest house price index confirming that it is leading the UK for both monthly and annual house price growth at present.

With the city suffering a major housing shortage (like many of the UK’s urban areas), Manchester is in desperate need of new homes – and recent figures show that that is precisely what it is getting. Deloitte Real Estate’s annual Manchester Crane Survey reports that 2018 was the city’s third record year in a row for residential real estate development. A total of 48 residential schemes were underway over the course of the year. Together they account for some 14,480 homes – 3,345 more than were under construction at the same time in 2017.
Not only that, but the pace of the construction is continuing to increase – so much so, that more homes should be delivered over the coming three years than were built in the last decade.

“Manchester is a key buy to let location with incredible future potential. Those who spotted the signs early have already enjoyed years of healthy yields and capital growth courtesy of their Manchester buy to let purchases, but the city is far from done. The huge commitment to building enough homes for its future population is producing some outstanding opportunities in this dynamic northern hotspot.”

Jonathan Stephens, MD, Surrenden Invest
One of the developments contributing to the impressive 2018 figures is Middlewood Plaza, in the heart of the city’s Middlewood Locks regeneration zone. Available for investment from £153,000 and with a net yield of 5%, the development offers stylish apartments, townhouses and duplexes to buy to let investors wanting to be a part of Manchester’s success story. The luxurious residences offer a turnkey management solution designed to capitalise on the city’s booming market. Deluxe furniture packs, secure underground parking and a superb roof terrace all maximise the building’s appeal to tenants, as does its location just 10 minutes from Manchester city centre.

“Last year Manchester established itself as one of Europe’s fastest growing cities, and this year’s report shows no sign of activity slowing down. The city is leading the way in catering for an increasing population through the development of entire new neighbourhoods – whether that is bringing forward new living, retail or office space. These new districts are redefining the parameters of the city centre as development spills out into the suburbs, particularly in the northern and eastern quadrants of the city.”

Simon Bedford, Partner, Deloitte Real Estate

To stay up to date with investing in Manchester and other UK regional cities, simply follow the Surrenden Invest team on social media.