I do like to have
a coffee at Cafe Leo on Westgate in Grantham. Whilst in there, a suited
gentleman approached me and asked if I was the person who wrote the newsletters
about the Grantham property market. We ended up having an interesting chat
about the local property market, as he was concerned his daughter would never
be able to buy her own property, a place in Grantham she herself can call home.
My latest analysis, using the Land
Registry and Office of National Statistics, shows that last month, there was no change in the
property values in Grantham. However, the year on year figures showed the
value of residential property in Grantham has increased by 4.2% in the year to
the end February 2016, taking the average value of a property in the council
area to £135,300.
It gets even more interesting when
we look at the last few months’ figures and see the patterns that seem to be
emerging.
·
January 2016 - a rise of 0.3%
·
December 2015 - a rise of 0.1%
·
November 2015 - a rise of 0.3%
We have talked in many recent
articles about the lack of properties being built in Grantham over the last 30
years. This lack of new building has been the biggest factor that has
contributed to Grantham property values still being 141.83% higher than in 1995.
At the risk of repeating myself, until the Government addresses this issue, and
allows more properties to be built, things will continue to get worse as the UK
population grows at just under 500,000 people a year (which is a combination of
around 226,000 people because of higher birth rates/people living longer and 259,000
net migration) whilst the country is only building 152,400 properties a year –
no wonder demand is outstripping supply.
Another reason
intensifying the current level of property values in Grantham, is the fact that
people aren’t moving home as much as they used to, meaning fewer properties are
coming onto the market for sale, so in consequence, there is a lack of choice
of property to buy, meaning people thinking of moving are discouraged from
putting their property on the market ... thus perpetuating the problem, as the scarcity
of possible properties to buy in order to move also deters people from offering
their home for sale. This unevenness between demand from would-be purchasers
and the number of properties coming on to the market for sale is causing
pressures in Grantham (and the rest of the UK).
So what of the
future of the Grantham property market and this man’s daughter? I firmly
believe the property market in Grantham and the country as a whole is changing
its attitude about homeownership. Back in the 1960’s, 70’s, 80’s and 90’s,
getting on the property ladder was everything. Since the late 1990’s, we as a
country (in particular, the young) have slowly started to change our attitude to
homeownership. We are moving to a more European model, where people choose to
rent in their 20’s and 30’s (meaning they can move freely and not be tied to a
property), then inherit money in their 50’s when their property owning parents
pass away, allowing them to buy property themselves ... just like they do in
Germany and other sophisticated and mature European counties, meaning his
daughter will end up owning property, just later in life than we did. So,
whatever the vote on the 23rd of June, if you think about it, we might be more
European than we think!
