Guildford House Prices vs Guildford Rents since 2006

The Guildford housing market is a fascinating beast and has been particularly interesting since the Credit Crunch of 2008/9 with the subsequent property market crash. There is currently some talk of a ‘property bubble’ nationally as Brexit seems to be the ‘go-to’ excuse for every issue in the Country. Upon saying that, looking at both what we do as an agent, and chatting with my fellow property professionals in Guildford, the market has certainly changed for both buyers and sellers alike (be they Guildford buy to let landlords, Guildford first time buyers or Guildford owner occupiers looking to make the move up the Guildford property ladder).

Guildford House Values are 1.79% lower than a year ago, and the rents Guildford tenants have to pay are 1.5% higher than a year ago

When we compare little old Guildford to the national picture, national property values have risen by 0.4% compared to last month and risen by 3.0% compared to a year ago, and this will surprise you even more, as nationally, property values are 19.8% higher than January 2015 (compared to 11.4% higher in the EU in the same time frame).

However, if we look further back…

Since 2006, Guildford House Values are 64.5% higher, yet the rents Guildford tenants have had to pay for their Guildford rental property are 26.4% higher

…which sounds a lot, yet UK inflation in those 12 years has been 42%, meaning Guildford tenants are 15.6% better off in ‘real spending power terms’.

Looking at the graph, the rental changes have been much gentler than the roller coaster ride of property values. I particularly want to bring to your attention the dip in Guildford house values (in red) in the years of 2008 and 2009 … yet as Guildford property values started to rise after the summer of 2009, see how Guildford rents dipped 6/12 months later (the yellow bars)…. Fascinating!

So, we have a win for tenants and a win for the homeowners, as they are also happy due to the increase in the value of their Guildford property.

However, maybe an even more interesting point is for the long-term Guildford buy to let landlords. The performance of Guildford rental income vs Guildford house values has seen the resultant yields drop over time (if house prices rise quicker than rents – yields drop).

Whilst, it’s true Guildford landlords have benefited from decent capital growth over the last decade –with the new tax rules for landlords – now more than ever, it’s so important to maximise one’s yields to ensure the long term health of your Guildford buy to let portfolio. More and more I am sitting down with both Guildford landlords of mine and landlords of other agents who might not be trained in these skills – to carry out an MOT style check on their Guildford portfolio, to ensure your investment will meet your future needs of capital growth and income. If you don’t want to miss out on such a MOT check up, drop me a line – what have you got to lose? 30 minutes of time against peace of mind – the choice is yours.

Data Sources

ONS for rents

Land Registry for Property Values

European – Eurostat

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