A solicitor friend of mine was asking me about my thoughts on the Glastonbury property market over the next 5 years.
Property prices are both a national obsession and a key driver of the consumer economy.
So what will happen in the next 5 years in the Glastonbury property market?
Before I look at the Glastonbury property market over the next 5 years I have looked at what has happened over the last 5 years.
One of the key drivers of the property market and property values is employment (or lack of it) as that drives wage growth and confidence – first-time buyers buying their first property, existing home owners moving up the property ladder or buy-to-let investors buying more property.
Back in 2010 when the coalition government came to power the total number of people in the Mendip area who were unemployed was 3200 or 6.1% of the working age population. The most recent statistics show the number of people unemployed in the Mendip area has dropped to just 2200 or 3.9% of the working age population.
As the Mid-Somerset jobs market improves, salaries are rising too. Gross weekly pay in the Mendip area rose 3% in 2015. This doesn’t sound like a huge amount, but given the fact that inflation has been hovering just above zero it is nonetheless significant.
Despite the turbulence of the intervening years, property values in Glastonbury are 6.44% higher today than they were 5 years ago.
In the aftermath of the credit crunch many home owners over the last 7 or 8 years held off on their next move. With a more positive economic outlook many have decided to hold back no longer, seize the opportunity and make their move. The effect of this is a more active market.
With a more stable economy in Mid-Somerset, this will, I believe drive a slow but distinct five year-year wave of house sales and house price growth in Glastonbury and the wider Mid-Somerset area.
I forecast Glastonbury property values will increase at least 12 percent by 2021. This may look optimistic for many but when we consider Glastonbury property values have risen over 6% in the last 5 years my forecast seems reasonable. My forecast is, I believe, a fair and reasonable balance of the positive and negative influences on the local market.
However for the positive picture I paint it would be remiss of me not to mention the clouds on the horizon that will have a negative impact on many. The number of properties being built in Glastonbury and the wider Mendip district is not keeping pace with demand which restricts choice but it does keep prices up.
Interest rates are predicted to rise any time this year between Easter and Christmas depending on which prediction you believe.
Finally there are the new buy-to-let taxation rules that will be introduced between 2017 and 2021. I believe more than ever that carefully choosing where to invest will outweigh the clouds on the horizon.
With interest rates so low, investors may as well put their money under the bed. Property prices, in contrast, have risen steadily over recent years despite property crashes and the returns from property have outstripped bank accounts and inflation. Investment in property should be for the long term and despite all the ups and downs will outperform other investments in the long run. For those people in Glastonbury who have some money to invest you would be silly not to consider property as a long-term investment – just make sure you buy the right property in the right location at the right price.
About Tom Morgan
Founder of Jungle Property the multi award-winning letting agent based in Glastonbury, Somerset. I am passionate about property and Glastonbury and about providing the very best advice to anyone who wants the best return on a buy-to-let property investment. For an open and brutally honest opinion on anything in the Glastonbury property market please contact me via tom.morgan@jungleproperty.co.uk
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