Maple Ridge Property Magazine

UK Property Market: Current Scenario

admin — Wed, 23 Jul 2008 15:12:49 +0000

After the world declared itself in depression, the UK economy also saw a massive impact on its property market prices. The inflation levels rose in UK thus affecting the pockets of consumers in the country, while the property market plummeted by almost 6% which was considered the biggest decrease in last two decades.

The gloom has already set in the property market and all homeowners can do now is wait for the next boom to arrive in the market. The main reason for the fall in property market prices is that interest rates have gone up and people are finding the prospective market for properties in other parts of Europe more favourable at the moment. Even mortgage costs have risen drastically and this has badly affected consumer confidence in the UK. Moreover, household bills and the rising cost of living coupled with the upsurge in the prices of the commodities have also affected the sale of properties.

This situation has been worst felt by those homeowners who find they are looking at negative equity. Tight lending regulations in force now are also having an adverse affect on the once booming housing market.

Property sales are always considered as a key signal to the economic stability and faith in the economic system of the country. It gives the homeowners and the government the assurance that they have valuables in their possession which are in the form of land and property but due to the falling prices of property and increasing inflation, doubt has been cast in the minds of the public. They are obviously worried about their finances and daily budgetary needs and so consequently growth and economic progress also decline with the fall in house prices.

Even the labour market is unstable with rising unemployment and can be directly attributed to the downturn in the property market. Some analysts and economists consider recent property prices in the UK to have been overvalued due to the boom in the world economy. But as world recession kicks in, the prices are actually dropping back to what is considered their normal prices.

The property market is expected to fall by 30% in 2009 with the outlook for 2010 even gloomier before an expected recovery in 2011 or 2012. It looks like homeowners in particular and the general public will have to endure another couple of years of hardship before things take a turn for the better. In conclusion, it may be better looking for homes for rent than to take the risk of buying into the volatile housing market.

The House that Died

admin — Wed, 23 Jul 2008 15:06:52 +0000

There is a very eloquent, sad poem which you will come across in one of the books of yore – it speaks of a house that had died. The description is heart-rending. It makes you envision an image of the house lying derelict and wasted. The dark empty windows of the house are compared to the eyes of a blind man – soulless. The rooms are lying threadbare with not even a hint of the laughter that rang so loudly and emphatically in them some time not too long ago.

The leaves in the garden need raking, the empty yard mourns for the children that once played in it, the tattered gate is swinging wildly in the wind begging to be shut, the hole in the roof is likened to a terrible wound inflicted on the house, the water in the small pond by the side is so full of slime that not even fish, frogs and other reptiles can frequent it any longer, the front door has been removed completely and brutally from its hinges – it is as if all the fun and frolic has been wrenched away from the house in one heartless tug.

The crisis faced by the United Kingdom Property Market is quite aptly epitomised in this poetic description. With house prices down by nearly 2% in the last quarter itself, and the continuing downward slide on the property market, the houses are already being laid bare. The house vendors and sellers are coming up with different ways to sell the houses, by hook or by crook. Yet, the subprime mortgage crisis has had such a profound effect that all the effort seems to be going down the drain.

Country homes have reportedly suffered the steepest price fall in over a decade so it’s not exactly the right time to be a part of the UK property market. Everyone in the United Kingdom is somehow or the other connected to the decline. The lenders (mostly banks) who would have invested in stock markets have had to hold it back. The effect has been so devastating that inflation has hit not just homes, but also across a wide spectrum which includes crude oil as well as a measly potato.

I am sure the house that died is always on the lookout for saviours in the form of inhabitants – right now, so is the UK property market. Sadly this story is true of many homes for sale in the UK.

Have You Been Gazumped? Learn How to Avoid It

admin — Tue, 22 Apr 2008 12:07:51 +0000

Being gazumped is probably the biggest bane of purchasing a property; it doesn’t matter if it’s a new house for yourself, a commercial property or even a residential investment property. It can also be a massive problem for property investors especially, as they are inclined to offer below market value for a potential property. Meaning someone could come in after them and put in a slightly higher offer, leading to them being gazumped.
The phenomenon of gazumping frequently leads to a massive loss of income, particularly because so much time has been invested on the properties in question. At the end of the day, you may be able to make back any possible profit on these deals that could have been lost, but the time lost, especially as you could have been using it on another deal, will never be retrievable.
The only way to avoid being gazumped is by getting the vendor to accept a “lockout” or “exclusivity” agreement. This type of contract specifies that the vendor will not accept an offer or sell to, anyone else during a certain specified time period. The agreement could be tailored to prevent the vendor from being able to even offer a viewing of the property without you giving your consent.
All decent solicitors will be able to draw up an exclusivity contract that is effective for you. It could cost a fair bit of money but it is well worth it in the end. And if you want to be sneaky about it, once contacts have been drawn up, you could then conceivably use this as a template for any future deals you may have.
Sellers, who may be having problems getting rid of their property for sale in Norwich or indeed needing to sell quickly, should not have any problems entering this type of agreement. They will be conscious of the fact that you’re a professional and are only protecting your prospective investment. Nonetheless, you may have to give a deposit as a gesture of good will; this would normally be about two percent of the property’s value.
Sometimes it may seem pointless on having this type of agreement in place for all of your prospective purchases, because if some prospective sellers have been having difficulties selling their property’s for six months, for example, and no one has viewed it for four of those months, it’s hardly likely that a person will come in and gazump you in a couple of weeks time. You won’t need this agreement on every deal, that’s for sure, but it may be an option to use on a really big deal that is potentially going to make you loads of money.

Buying to Let in the UK

admin — Tue, 22 Apr 2008 12:06:44 +0000

Buying to let has grown enormously popular within the property market in recent times. Buy to let means to invest in a residential (mainly) property and rent it out for profit or to use as a kind of mortgage payment, which is used to buy the particular property.
The main benefit of buying to let is that you receive a steady flow of income from the tenants. It is also a great way to invest in the property market because of the constant increase in house prices across the country. By entering the buy to let area of property letting, you need a certain amount of knowledge on mortgage products, the marketplace and the various insurance options that are available to you.
One risky aspect of this however, is that when it comes to buying a property on a buy to let basis, is will the property in question be constantly occupied, as you will still have to continue paying the monthly mortgage on top of all the other bills.
Since the middle of the nineties there has been sustained growth in the property market which has lead to huge demand for property to rent. Buying to let though has received some negative publicity recently, with it being described as another way for people to earn money without the need of working.
In saying this though, the people who are involved in the property market think the notion of buying to let and the thought of becoming a landlord, very attractive indeed. The Housing Act of 1988 abolished what was known as security of tenure for tenants which meant that landlords gained the right to evict tenants that caused problems much more easily than when the act was law. When the house market crashed in the late eighties and early nineties, an increase in the number of tenants was observed, as people were losing their homes due to repossession.
When choosing buy to let property, do so carefully and take plenty of time to research and find out the mechanisms of the property market. Looking at property for sale in Acle Another important aspect is making sure that the targeted property is in the correct location for the market you will be aiming for and also that it is furnished to the standard that would be expected for the kind of tenant you are searching for. Make sure that personal taste doesn’t enter the equation because you must remember that buying a property is a business investment.
Letting property is situated in a very competitive area of the housing market business so you will need to make sure that you offer your prospective tenants value for their money. A good way of achieving this is to take on a property management company. They will be able to carry out tasks on your behalf such as rent collecting and property maintenance in an appropriate and professional manner.

Avoiding the Pitfalls of Buying Property to Let in the UK

admin — Tue, 22 Apr 2008 12:05:14 +0000

Inexperienced property investors in the UK are making more and more elementary mistakes. They try to decide where to invest in property in the UK followed by trying to copy the strategies of successful investors of ten years back. They make the mistake of assuming that if an investor from back then made their money in a particular way then that should still be lucrative and viable today.

We can’t dispute the fantastic wealth some of these property tycoons accumulated from their empires. Prospective investors watching shows on television and seeing the types of houses these tycoons live in and the wonderful array of cars they own and it makes them want to jump straight into copying their strategies from old, not fully comprehending that today’s property market is vastly different to what it was.

If someone invested in a property about ten or fifteen years ago anywhere in the UK, then the chances are that the rent would have covered the mortgage payments. Nowadays, that luxury does not exist and each and every potential investment decision needs to be made with careful consideration.

Basically this is the main problem that comes up when strategies from the past are imitated without totally understanding the implication of all your actions. There is no doubting those wealthy tycoons shown on TV made an absolute killing all those years ago, but it doesn’t necessarily mean that these same individuals would be able to do the same again using the same strategies.

Property investors countrywide who are not meticulous in their dealings are making massive mistakes just by simply following the incorrect strategies in their pursuit of building up their portfolio as fast as they possibly can. They do not understand that a major component of making money through property is being knowledgeable about your market.

Investors in today’s market place need to gain the knowledge of how to respect current prevailing conditions in the market. They have to learn to adapt to any conditions the market can throw at them. They need to be great negotiators and excellent researchers. The question posed in today’s property market should no longer be where to buy the property as almost no any areas in the United Kingdom make any financial sense to buy to let in. I would advise all investors to look at property for sale in Wymondham and property for sale in Attleborough. The new question should read: how far below the market value can a property be bought in any particular location, so as the figures all add up and become financially feasible?