Tuesday, Jul 17, 2007
Buy to let investors advised they should evaluate future pressures
The Landlord Association: Buy to let investors advised they should evaluate future pressures
But buy-to-let investors who have been snapping up modern flats over the past decade might want to consider if their properties are desirable enough to withstand future price pressure.
Posted by the landlord assocation @ 07:32 PM (144 views) Add Comment
5 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. enuii said...
Ah, the old chestnut of flats or 'apartments' as they are sometimes called in these seriously enlightened times. I recall some statistics published this year that over the whole of the U.K. 50% of all new-builds were of this flavour and the majority aimed at young singletons desperate to get on the so called 'housing ladder'. The serious problem with the majority of these 1/2 bedroom properties is that they are currently overvalued and will become notoriously difficult to shift on the 'used' property market especially when there are some many new ones available due to overbuilding by greedy developers in this sector.
This type of property is admirably suitable to the rental market but as I have said before and I'll say it again if you want an affordable house to live in get a terraced property for its increased long term living flexibility and access to your own outside space.
2. Ihopeitgoeswithabang said...
I can help with that. No they are not desirable enough.
It just seemed like a good idea at the time - so they were told lol.
3. p. doff said...
Ah yes! Many novice landlords/speculators have got their fingers burned on off-plan new flats. They have fallen for the hype and VI spin and promises of an easy quick buck.
I've previously referred to a block of 2 bed flats in this area which were selling off plan for £200K, when nearby 3 bed bungalows in a better position were selling for the same or less. Beggars belief I know. The 'flippers' put them back on the market at £230K: meanwhile, the developer couldn't shift the last few and dropped the asking price to £180K (but has accepted £175K on some). A couple have been let, but the rent doesn't cover the mortgage (and the these flats will drop further in value as they lose their new 'sparkle'). You may be interested to hear that one of the buyers is an estate agent, and two others were financial advisers, which just goes to prove that common sense goes out the window when your previous lucky successes create the impression that you have made it purely through your business acumen.
It's exactly the same story in another flats development in a nearby town - we have already done some repossession valuations on these where the properties have never been occupied.
You may conclude from the above that the flats market is crashing (at least in some areas) but this is entirely not the case. I know this sounds like a contradiction but the same thing is happening all over again in another block of flats under construction in another town in this area. It seems that there is always a fresh supply of misty eyed speculators willing to jump into the same hole. The tide has not yet turned I'm afraid, but it keeps me gainfully employed. Of today's valuations, 2 were BTL, 1 was RMTL, 1 owner occupier purchase, and 1 second charge loan - Josh, yer dad's found yer scootah!!!!
On a related topic I spoke to a mortgage adviser colleague today who was dealing with a BTL application. The punter wanted a mortgage to buy a 'really good' investment. When they worked it out, the mortgage ended up at about £750pm, and the anticipated rental was about £600 gross. Why don't people sit down and think what they are doing any more? Thankfully, my colleague offered the customer sound advice (well, he couldn't get the advance anyway), but there are plenty of bent brokers out there willing to 'help' the punter get into debt by whatever scam they can come up with.
God, is that the time - I'm off to bed.
4. tyrellcorporation said...
C'mon everyone this guy is just trying to get hits on his site... He hasn't posted in either of his threads so what's the point in commenting. Ignore!
5. Orwell said...
Where about are you? P Doff?