Cheltenham's Property Market
The state of the property market remains a fascinating and important essential to the UK public and, in general terms, the market continues to be buyer led. The market in and around Cheltenham however, has proved to be one of the UK’s most resilient according to David Evans at Savills.
“It has been, and continues to be,” he said, “dominated by families moving to the city and surrounding areas, attracted by the fabulous schooling. Demand for property between £500,000 and £1.5 million proves to be considerable year on year and family houses around £1,000,000 tend to be in particularly short supply. Town properties with good sized gardens and parking are rarely on the market for long.”
“Having said all that,” he continued, “purchasers do want comfort. Having exposed themselves to considerable purchasing and moving costs, they want to be sure that they are getting either value for money, or, if they are in competition, to feel that they are buying the best house. So, on the one hand realistic pricing remains tantamount to a successful sales campaign, on the other, ‘best in class’ will continue to achieve premium prices. Properties that, for one reason or another, do not quite tick all the boxes fall under ‘secondary stock’. This doesn’t mean they won’t sell, merely that one should err on the side of caution when setting the price guide, particularly where purchasers are keen to protect their investment and when the prospect of inflation in the short term is negligible.”
Phil Pugh of Philip Pugh & Partners agrees about the importance of pricing. “The market has dramatically improved in March, along with the weather and sensibly priced properties are selling very well, whilst others are sticking. It really does seem down to pricing – particularly for family houses – but then it of course depends upon how keen owners are to get going. Buyers also seem to fall mainly into two groups at present, firstly those who have recognised that the market is moving and are making quick decisions, whilst others still remain nervous and are therefore either delaying making offers or perhaps making low offers and then losing out.
“There still don’t appear to be many first time buyers or investment buyers at the lower end of the market and these properties are in our experience not creating much interest and lowering the asking prices seems to make little difference at present.”
Nigel Errington-Smith of ErringtonSmith added that he is, “still very busy with properties coming on to the market and sales being agreed. If the continued improvement lives up to expectations we should be heading towards a prosperous Spring.” Let’s hope he is right!
Gavin Wallace from Isherwoods also added that, “Whilst volumes in the sales market continue to be relatively low we have certainly noticed an increase in general activity, with the spring now upon us, this is the time to sell! An interesting new report from Lloyds TSB has confirmed that property prices in spa towns such as Cheltenham continue to outperform the market. Property prices in spa towns across England and Wales are on average £38,000 (or 16%) above their county average, according to their research. Average house prices in 15 of 18 spa towns surveyed are significantly higher than those in neighbouring towns. The report indicates the average price of a property in Cheltenham at £279,252 against a county average of £239,446 – a premium of 17%.”
This is supposedly because spa towns like Cheltenham are often thought of as having a higher quality of life.
And it’s still good news on the rental front. According to Gavin, “The Cheltenham lettings market is showing signs of an extremely busy summer with enquiries and new lets rising steadily. Many more good quality apartments and houses of all sizes will be required to satisfy this demand and rent levels are likely to remain healthy.”
This all sounds great for the prospective tenant, but what if you are the landlord? Marcus Annfield of Woodfield Lettings in Cheltenham has teamed up with Thomas Derrett of ADR Solutions, a local expert in the field of deposit dispute resolution, to offer some advice.
It would appear that these are the harsh facts:
1. Landlords are thought to be losing £12million per year on deposit disputes.
2. Landlords only have an 8% chance of winning a deposit dispute outright.
3. The tenant walks away with all the money in almost half the claims.
4. More than 50% of claims are thrown out for administrative errors and never reach an adjudicator.
5. There were an estimated 23,000 deposit disputes last year, and that figure is rising as tenants realise they are in a strong position.
As a landlord, the onus is on you to take action to avoid deposit disputes and to ensure that you win the ones that you cannot avoid. There are a few things that you can do that will really help.
Without a signed tenancy agreement you can forget about winning any dispute and a pre formatted tenancy agreement may not protect you. There is no substitute for spending half an hour with a lawyer you trust when it comes to getting a legally compliant agreement that contains all the clauses you need for your particular circumstances. It may cost a bit more, but you will probably reuse it many times during your letting career.
If you don’t protect the deposit properly, you run the risk of losing the dispute on a technicality. If you don’t protect it at all, you may end up giving all the deposit back to avoid being sued by the tenant... ...or worse. Landlords who do their own inventories or, worse, don’t bother at all, are leaving themselves wide open. Without a record of what the property was like when the tenant moved in, they could gut the place and you might not win a claim on the deposit.
It is considered best practice to invite the tenant to the check-out meeting - by email if possible so you can prove you did so - and if they want you to reschedule the meeting, agree if possible. The statistics show that where the tenant attends a check-out with the landlord or inventory clerk, they are much less likely to dispute your claim on the deposit.
If you do have to claim on the deposit, give the tenant notice of what you intend to claim for and an estimated cost within 10 days. Some of the schemes insist on it and it is good practice in any case. If your estimates turn out to be inaccurate, explain why to the tenant. Don’t add items after the 10 day deadline unless you really have to. It looks bad if the amount keeps going up and up. It will only make the tenant want to dispute your claim, where a small compromise on cost might save you a lengthy dispute.