Forest Hill Property Blog
Following last week's article, I had an interesting chat with a chap who lives in East Dulwich. He is thinking of buy his first buy to let property and as the average value of a property in East Dulwich presently stands at £652,300, he thought Forest Hill would be more affordable and more realistic to buy and rent in. He particularly wanted my opinion on the state of the Forest Hill property market and whether it was a good time to invest.He was worried that with all the newspaper headlines of a booming housing market, whether there wouldn't be any demand from tenants. One of the best pieces of advice I can give those looking to invest in property is a simple trick of the trade. You can judge the affordability of an area's property market (and thus how much potential demand there will be) by simply finding the ratio of the average property price to its average salary. The lower the ratio, the more affordable property is. So we put this to the test, if you recall, a few weeks ago I said that the current average value of a property in Forest Hill was £450,500. The average salary of someone living in Forest Hill is £33,816 per year. This equates to a ratio of 13.44 to 1. Most lenders will only lend four and a half times income, so to buy and average house in Forest Hill a first time buyer would need to be on a salary of £101,000 and even then, would need to raise the 5% deposit which, when you take into account buying fees, would be somewhere in the order of £24,700. Tenant's inability to raise that sort of money for the deposit is driving the demand for rental property.If you would like advice on buy to let whether you are a landlord with an existing portfolio, an accidental landlord or someone who is thinking of investing in the Forest Hill property market for the first time; please feel free to contact me on 020 8699 5139 or email Forest Hill – Good Time to Buy?