21
Nov
Author: John Cooper / Category:
Weekly Summary
Both good news and bad news on the property market last week. Perhaps the most positive is that the number of house sales completed rose and mortgage lending rates also picked up. This is very promising news and shows that the market crash may not be quite as long-lasting as was first feared although there is course some way to go before everything is ok again.
On the downside there was some negative press on the buy-to-let market and we recommend you meet it head on and argue why its still a good time to invest rather than just avoid the subject altogether.
Heres a news summary from the last week:
14
Nov
Author: John Cooper / Category:
Weekly Summary
Plenty to talk about in the property market once again this week. On Monday we saw more mortgage lenders announcing they would pass on the bank rate reduction to their borrowers as well as Nationwide predicting house prices would continue to fall in 2009/10.
On Wednesday the Bank of England predicted that the UK economy could shrink by 2% over the next year and that a recovery will not take place until well in to 2009.
Following the bank rate cut to 3% three lenders relaunched tracker deals for new borrowers on Wednesday passing on at least part of the cut. Also on Wednesday it was announced that UK unemployment had reached an 11 year high with 1.82m people currently out of work, this will not be helped by todays announcement by the RBS that they will cut 3,000 jobs.
Today it was announced that the Eurozone was officially in a recession with the UK, Germany, Italy and Spain all suffering significant economic problems.
Heres a news summary from the last week:
What does all this mean to would-be property investors? Well a large majority are being put off by the current climate and its your job to show them why all of this is good news for property investment.
The lower mortgage rates and falling house prices means they will be able to buy houses cheaper AND secure a cheaper mortgage on them. This then means that the cashflow produced from buy-to-let is significantly increased.
What’s more, with unemployment rising and the recession coming in to full force less people are going to be able to pay their mortgage or get on the housing market in the first place. This means there will be more repossessions and more bargains, but more critically there will be more people looking for rental property.
So put all of this together and you have cheaper house prices, cheaper mortgages and an increasing rental demand. This is a buy-to-let investors dream! Some people think it’s better to wait until house prices bottom-out.
This is the wrong thought process because that’s only thinking about equity when for an investor equity does not come in to it as you are not selling houses you are only buying them and renting them out.
07
Nov
Author: John Cooper / Category:
Weekly Summary
The big news this week is that the Bank of England has cut interest rates by a massive 1.5% down to just 3%, this is the biggest cut since 1955!! So what does this mean to property investors? It means that the cost of mortgages should fall a little over the coming months, especially as Prime Minister Gordon Brown is putting pressure on to ensure the rate cut is passed on to customers.
All in all that means investors should be able to buy cheaper houses (a 2.2.% fall in house prices in October), with a lower mortgage rate and yet still benefit from increasing rental demand and prices. This means investors have a great opportunity to find bargain properties that generate and impressive positive monthly cashflow!
Heres a news summary from the last week:
