Mending the Broken Ashford Property Market

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The long-lasting issues of the Ashford property market are laid bare as the final 2018 property transaction figures have just been published and they continue the post credit crunch trend of less people moving.

26.8% less Ashford people are selling their homes annually since the credit crunch compared to the post Millennium years of 2000-05

This is not solely an issue of the Ashford housing market slowing down since the credit crunch – the challenge is to separate shorter-term factors such as Brexit and the upcoming election from longer-term structural issues of the UK society, because when these most recent property transaction figures are seen against longer-term trends for Ashford, they suggest there are more significant issues within the Ashford housing market.

In the late 1990’s, 2,035 properties were sold annually in the Ashford area, then in the same area, the Millennium boom saw transactions rise to 2,886 per annum. Property sales then almost halved to 1,639 per annum in the challenge of the global financial crash and subsequent retrenchment of the mortgage market. Post credit crunch (2012 and beyond) locally, on average, 2,111 properties have sold annually:

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So whilst there was a recovery from 2013 onwards, it was

rather uninspiring when compared to the pre-credit crunch years, with a lacklustre
performance in property transactions since the mid 2010’s.

You might ask why should we be concerned about the number of property transactions and not the change in property values?

The fact is, the number of property transactions are a far more reliable bellwether of the health and potency of the local housing market.

As less people have been selling their homes locally, this is not only bad for the Ashford housing market but also for the local economy, especially when you consider how many allied businesses – builders, decorators, solicitors, removal vans, estate agents, mortgage arrangers and others  lose out as a result.

Some say the deficiency of property supply, mainly in affordable first-time buyer homes, is the chief reason why transaction figures remain stubbornly low. Others suggest an absence of suitable housing stock elsewhere in the property ladder (particularly bungalows for older generations), combined with rising demand, is causing a bottleneck in our local housing market.

I know there has been much talk in Westminster of grand home-building programmes, yet we require actual delivery of these undertakings and, even then, it will be a decades before any seismic change in the Ashford property market is seen as a result.

In the short-term, a quicker improvement may come from changes to stamp duty: First time buyers do not incur Stamp Duty up to a certain level, yet those Stamp Duty concessions could so easily be also extended to mature homeowners looking to downsize. This could liberate a meaningful number of family homes currently occupied principally by retirees and the tax lost through Stamp Duty could be replenished by a restructuring of the Council Tax bands.

The Council Tax bandings were set in 1991 and the highest starts at £320,000 (based on 1991 values). It seems irrational that this upper value band, set in the 1991 revaluations, has not been increased, particularly as house prices in London have soared by over 400 per cent in the last 25 years.

These two changes would mean higher taxes for those who don’t move yet less tax for those that do – a situation that would encourage a far more liquid Ashford property market.

Just a thought of one possible way to mend the local property market – what are your thoughts?

Taylors Residential Lettings Limited, Company no. 6002742, Regd Office: Suite 1, Invicta Business Centre, Monument Way, Ashford TN24 0HB