Solihull Landlords count the cost of a Tory Election win

Can you remember 10.05pm on Thursday, 7^th May 2015 ... with the shock news that BBC Exit Polls suggested the Conservatives would be returned with majority? The middle classes in Solihull exhaled a huge sigh of relief, as Solihull landlords, faced with rent controls from Red Ed and the Labour Party, now had something to cheer about. The Tory’s were always considered to be a political party that accepted the importance of the rental market, fully supported its development while properly targeting the lawbreaker landlords renting out below standard rental accommodation.

Since May George Osborne has announced future rises in stamp duty for buy to let landlords and a change in the interest relief on buy to let mortgages, causing some people have to question that loyalty. However, things could have been a lot worse for Solihull landlords as previous ideas included making landlord’s pay more tax by increasing capital gains tax rates to the landlord’s own income tax levels. If Landlords would had to pay capital gains tax of 40% to 45% on any uplift in value, I can tell you here and now, that would have made investing in property a non starter for almost everyone.

However, I will admit that the loss of the higher rate tax relief of mortgages will mean that investing in a number of properties may not stack up financially. The new rules are likely to slow demand in the Solihull housing market, which is isn't necessarily bad news for landlords, as this could mean less competition from 'amateur' landlords. Just a thought, making Solihull landlords think twice and run their numbers more cautiously is not such a bad thing.

So looking at some of the numbers, the November figures have just been released and they show a growth of property values in Solihull of 0.8% over the month of November. That figure doesn’t surprise me due to the time of year. It’s quite dangerous to look at one month in isolation, so looking at a more medium term view, over the last 12 months, property values in Solihull have risen by 4.3%, not bad when you consider inflation is running at -0.1%.

However, regular readers of the Solihull Property Blog know my passion for looking deeper into the stats. The really interesting information is the value growth, but what types of property are actually selling in Solihull?  Looking at all the properties sold, as recorded by the Land Registry, within 2 miles of the centre of Solihull in September 2015 (this data always runs a couple of months behind the house price data) compared to September 2007 (a couple of months before the credit crunch started to bite and the subsequent property crash).

	Sept 2007	Sept 2015	Difference
Detached in Solihull	29	33	+14%
Semis in Solihull	33	29	-12%
Terraced Houses in Solihull	18	12	-33%
Apartments / Flats in Solihull	31	27	-13%

Now I have mentioned in previous articles that the numbers of properties selling in the town has certainly dropped post 2008, but what amazed me were the drop in the number of semis, terraces and apartments selling in Solihull compared to the sales of detached properties, which rose slightly.

Less properties are selling than last decade in Solihull and the types of properties selling have changed interesting times ahead for the Solihull Property market!

Therefore, all I can say to the landlords of Solihull is do your homework, make sure the numbers do stack up, take advice and opinion from professionals and above all, for those of you planning to add to your portfolio, buy the right property at the right price.