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Now is the time to buy - Taylor Wimpey

As rents reach a new high, now is the time to buy

Whether you’re a hard-pressed tenant feeling despondent about the thousands you’re throwing away in rent each year or an investor watching the interest payments on your savings dwindle, there’s a sensible opportunity available to you both to make the most of your hard-earned money.

According to a BBC report, private rents in England and Wales recently rose to record high levels of £705 per month, while in London they rose to a staggering £1,009 per month.

With rents reaching heights never seen before, now is the perfect time for those stuck in a rental rut to get out – and buying a brand new home is the way to do it. And with demand for rental properties also on the rise, putting money in bricks and mortar looks like a great solution for potential investors, too.

Although you might think that house prices have put home ownership out of the reach of many renters, it should be remembered that the vast majority of these potential first-time buyers can afford the monthly mortgage payments, because they’re already paying a great deal more each month in rent.

When you consider the average rental price of two-bedroom flat in Basingstoke, for example, is in excess of £800*, it’s quite clear than anyone paying out that kind of money each month can keep up with a mortgage.

In fact, they’re likely to end up making massive monthly savings with a mortgage compared with rent – as great-value prices for brand new two-bedroom apartments at Taylor Wimpey’s Everest Park development in Basingstoke start at just £149,000, for instance.

The sticking point for most people is saving for a deposit while facing ever-increasing rental demands, and here’s where buying brand new is the answer. The prices of brand new homes can often compare very favourably with those of homes for sale on the second-hand market nearby. In Basingstoke, for example, a typical two-bedroom property is priced at more than £159,000** – that’s over £10,000 more than a two-bedroom apartment at Everest Park.

What’s more, many housebuilders offer incentives to give first-time buyers a step up onto the property ladder, such as Taylor Wimpey’s fantastic Gifted Deposit initiative, while the Government’s FirstBuy scheme, available at many new homes developments nationwide, also gives aspiring home-owners a welcome helping hand.

In fact, renting isn’t an easy option when it comes to finding a deposit either. Most landlords are looking for at least a month’s rent as a deposit, which as we’ve already seen, is on average over £1,000 in the capital, meaning that the Bank of Mum and Dad is now often being called on to fund deposits for renting as well as buying.

However, demand for rental properties shows no sign of slowing, which brings me to the advantages of buying brand new for investors.

For those looking for a return on their money, becoming a property investor can offer an attractive yield which building societies can only dream of.

With interest rates still so low, savers are stuck with little reward for their prudence, but by investing in property they can benefit from the widening gap between rents and mortgage payments.

Buying a brand new, high-quality property with energy-efficient central heating, double glazing and a modern fitted kitchen as standard means they can offer a comfortable and desirable home to tenants, who’ll have no dodgy boilers or winter draughts making them feel they should be looking elsewhere.

And as brand new properties are a great low-maintenance option, owners are also spared the time and money spent by landlords of older properties on costly repairs and renovations.
In short, rising rents mean buying a brand new home is the ultimate solution for investors and first-time buyers alike.

* The average rental price for a two-bedroom flat in Basingstoke was £805 per month on 12th December 2011, according to www.findaproperty.com.

Tim Betts

Tim Betts is Sales and Marketing Director for Taylor Wimpey West London, which has new homes developments in Berkshire, Buckinghamshire, Hampshire, Middlesex and Surrey.

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