Modern Developments for Homes and Investment
“Let’s shout it from the Dales: here’s why Yorkshire is the best.”
Of course, a lot of us think where we live is best. However, many people would love to live up here instead of where they live now.
There is certainly a quality of life here among the best in the country.
You see we think it’s grim down South, not up North!
The Guardian has published this feature piece by Dave Simpson who obviously has real affinity with Yorkshire and the Dales – worth a read if you know little about Yorkshire.
A short, interesting article flagging up the very real possibility that Student Landlords will soon be paying Council Tax. To be fair, it is very hard to argue that there should be no Council Tax paid, or that the burden should be borne by the students themselves. After all the recent legislative and taxation changes, though, landlords are feeling very much under pressure.
As those of us who live in this ‘golden triangle’ know, there is significant wealth around these parts. The prime end of the market in particular remains buoyant and shows all signs of maintaining solid growth even should the post-Brexit UK economy take a significant downturn.
This is not only at the luxury end though. All house sale prices remain on the up and Harrogate, in particular, has historically ridden property downturns much better than the city conurbations of West Yorkshire and significant areas of York. ‘Oop North’, everyone aspires to live somewhere around here.
BUT you have to know exactly where is best. You cannot beat detailed, accurate local knowledge when choosing specific strategies for specific properties in which to invest. Buy-to-let yields aren’t as favourable as other areas, capital growth and stability are the key. HMOs won’t work in very specific areas but boutique HMOs will fly in others.
This Financial Times article focuses on the prime market but illuminates any number of good reasons for investing in the ‘golden triangle’ at all levels of the property market. In uncertain times, investment in this very specific area of Yorkshire is increasingly looking a very sensible choice.
Prime property market strong with Yorkshire’s ‘golden triangle’
I’m having to investigate Capital Allowances on our Zetland House purchase, with a view to exploiting them ourselves on an ongoing basis and the valuation of any future sale.
This is a complex and, dare I say, crushingly dull affair. However, if it saves money, it makes you money and this article has provided me with the most illuminating overview so far. Perhaps the best advice in this article is to get a Capital Allowances specialist in your Power Team.
https://www.taxation.co.uk/Articles/2014/04/08/323051/good-bad-and-ugly
Renowned property experts Allsop say they are witnessing the exploitation of a gap in the student accommodation market for HMOs – the ‘secondary’ Private Rented Sector market, away from the institutional brands such as iQ and DIGS. Larger scale investors are looking specifically at developing and acquiring HMOs with close proximity, great facilities and, most importantly (what is nigh impossible at redbrick Universities) great yields.
Makes me think North of England. Think Huddersfield? 😉
HMOs
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Two of our Huddersfield student HMOs had conditions imposed on the planning approval requiring the premises only be let to students. Students are exempt from council tax and if we are presented with a council tax bill (which happened recently) we pay the council tax and have it quickly refunded.
For now we are safe, however, in future we know we have to be very careful in the design and implementation of HMOs. Councils seem to have identified a cash cow in imposing a council tax banding on individual rooms, depending on the range of facilities offered to tenants. Yesterday I found this excellent guide on criteria published by Comfort Lettings, which I thought could be a valuable share.
Council Tax liability for HMOs
Number 2 in their list of areas for property investment growth potential:
“2. Leeds, York and Harrogate – Yorkshire & Humberside. These are the affluent areas of the region where people are not as constrained by affordability. And yet, because prices are nowhere near the £1m, £2m, £3m mark that they are in London, growth has not been hit by stamp duty.”
So the Telegraph informs everyone of something we already know. The Leeds, York, Harrogate triangle is full of opportunity but there are subtle differences in the types of investment which will work efficiently in each area.
In Harrogate in particular, house prices have historically held well in recessions, so if you want to add a layer of protection to your asset pick your location very carefully. Harrogate is a great choice to protect capital but, overall, rentals yields are tighter than many areas of Leeds, where capital growth will still be limited despite infrastructure investment, but short term yields are more attractive. York has a fine mix of both opportunities but there are local factors such as a very strict implementation of Article 4 across the wider city inhibiting HMO investments.
I can’t stress it enough, local ‘boots on the ground’ with specialist local knowledge are what you need for confident, profitable and secure investments.
Which areas will see the biggest house price rises by 2020?
In six months time we could be wondering why we were worried. But, if there is economic trouble in China ahead it could knock confidence in the stock market and housing market, and in the long term it could impact jobs and companies in Britain that sell products to China, Mr Chegwidden explained.
There’s plenty of optimism for the next few years, both in the student sector and particularly Northern investments. A word of warning though, the report is soaked in one over-riding assumption – that international students will not be included in future migration target numbers. As long as they are not, Savill’s forecast 6% annual growth in numbers over the next 3 years. Well, that includes 2 years of the Brexit negotiation! If they are included – who knows how numbers will be affected?
Either Savill’s have someone in a position to know, or they’re taking a big punt.