Student Property… Still holding strong!
The student property market has still been relatively unfazed by this recession. The strong returns are still available and it is still a growing market. Student applications rose by 9% for the student year commencing September 2009.
Not only is the student buy to let market growing but did you know about the various grants available to bring your property up to HMO standards accepted by universities and authorities…Yes that’s right the landlord accreditation scheme means that if you buy a property that you intend to let as an HMO it may have to be up to a certain standard e.g. 3 double plug sockets in the living room and even bedrooms of a certain size. Some local authorities will pay half of your refurbishment costs up to the sum of £4,000!!! Not bad hey?
With the traditional buy to let market in dire straits why wouldn’t you look towards this bustling market, and place your property in an area that will always be in demand?
The landlord accreditation scheme:
The landlord accreditation scheme is free to join. It differs from area to area. But here are some advantages of our local Landlord Accreditation Scheme:
- Access to funding to bring your property up to Accredited standard up to £4,000.
- Full property listings on the university’s website and accommodation list.
- Eligibility to join the “Head Leasing Scheme” (Full management service).
- The status of being publicly identified as a good landlord, including formal certification.
- Discounts on goods and services such as property insurance, Mortgages and Loans.
For more details on the landlord accreditation scheme in your chosen area or to use the Fresh Invest Property Sourcing service email us here
Latest Buy to Let News…
Bank of Scotland will cease business from 01/07/2009, thus leaving even fewer lenders to choose from in this challenging market.
After a brief period of lenders lowering their rates last week saw rates rise due to the increase in SWAP rates. BM Solutions raised their but to let rates by up to 0.6% in one move with Platform also increasing by 0.6%.
It has been announced also that Leeds Building Society will no longer lend on new build flats on a buy to let basis. The market is certainly challenging and previous lenders are still showing no signs of re entering the market to ease the pressure.
Please be aware that the remaining current lenders will only lend on a certain percentage of a development and once this exposure limit is reached they will not lend anymore on the site.
Once certain lenders have reached their exposure limits obtaining a mortgage for sites/developments may become extremely difficult or sometimes impossible so please ensure you do not leave it till the last minute to enquire about or to arrange a mortgage.
Discounts drop as new build property runs out
As a property investment company we are uniquely placed to gather real time information on the UK property market.
These are our thoughts.
Well it’s simple supply and demand really.
As the market started to drop last year and various buy to let mortgages disappeared off the market many developers either land banked of sold off previously earmarked developments.
We are now starting to see the impact of this.
Less property coming onto the market means more potential buyers for the property that is left.
This in turn means that a new sense of confidence has appeared in the market.
Before, sellers may have had one or two viewings; they now have ten or twelve.
The only reason we have not seen a massive surge in prices is the remaining problem, which is loan to value rates.
However, this is also due to change.
We have it on good understanding that the Government is due to force a “must lend” initiative on lenders which is due in the next 6 weeks.
When this comes around I think we will see the end of any discounts whatsoever.
Until builders start to build again there simply is not the need for the developers to do deals.
Property Investment companies have always based their success on bulk selling units for a greater discount than an individual will obtain direct.
When the developer simply does not have the units to bulk sell our service becomes obsolete, for the time being anyway.
My Conclusion:
Buy at a discount whilst you can, you may not get another chance for a long while and you can bet that the investors that are prudent will have to take a massive hit on mortgage interest rates in the future, let’s face it, they won’t go down any more!
Invest before the next Step Up!
Sky news has reported that buyers are flooding back to the UK property market. Is it now time for everyone to jump on the band-wagon?
It is no secret that the UK property market has been hit hard by this recession, but with buyers “Flooding” back to the market there is only one way prices can go and that’s UP! Prices have been slowly rising over the past couple of months; as banks lessen the restrictions on their lending patterns and start to let the government’s efforts of quantitative easing, filter through to the consumer.
Sky news reported that last month there was on average 4 house hunters to every house on the market.
Now don’t get me wrong I know, as does everyone else, that the underlying reason for this recession has still not been rectified. The banks still have a lot of bad debt on their balance sheets and unemployment is still rising. But let’s paint one possible picture – The re-emergence of the buyer will see the seller take the opportunity to test the market. Now if these sellers can offload their property quickly enough, they will be able to take advantage of the current low interest rates to make the move that they have been waiting the last 18 months to achieve, for many this will be a movement up the ladder. We need to remember that there is 18 months worth of first time buyers waiting to make that first jump and this could be the fuel to fire the recovery.
If first time buyers do start flooding back to the market and property prices start to stabilise, maybe banks will be able to start lessening their restrictions on the credit driven companies , these may therefore be able to start employing again. If employment starts to rise then mortgage approvals will follow suit. Interest rates will have to rise but if people are in employment they will hopefully still be able to afford their repayments and if this happens in large quantities the banks will be in a much better position to survive this recession.
Property Investment – Do You Now Have a Choice?
Well lets look at the positives.
As my nan always says….you’ve always got your health!
To which i respond …..I’ll need it when I’m sleeping rough!
Seriously though, many people face the very real prospect of having to increase their pensions and savings to the level they were previously at, the only trouble is, they have even less time to do it!
2 Years ago your savings and pension values would most probably be well on their way to keeping you in the style you had become accustomed.
No Longer, you now have to think fairly seriously about increasing the value of your savings, so whats the best way to do that?
As far as i can see, 2 options come to mind.
1. High risk, but potentially high reward share dealing.
2. Property
Let me discredit the first one quickly, if you have never dealt with shares before i wouldn’t recommend such drastic action, if you fancy giving your hard earned to a broker think seriously about the fact it will probably end up with a banker who had a large part to play in losing you that money in the first place!
So we come to property investment.
Hardly surprising as that is what you do for a living i hear you say!
True, it’s also what i know best.
However it also produces returns of between 6-13% along with the capital growth which will undoubtedly occur whilst investing at the bottom of the market.
Look abroad and the yield can sometimes be up to 20% with capital growth upwards of 15% per annum.
In the past, many investors have discounted property because of the “risk” attached.
Unfortunately these same investors now may not have much of a choice!
If you need your pension to return you a decent amount and do not have 40 years in which to grow it you may simply have to look at property as an investment vehicle.
I’m currently looking at property in London that returns 7% and overseas property in Cape Verde that returns 12%.
Similar London property was selling 2 years ago at £400,000, now on the market at £270,000. If we reach the prices of yesteryear there is £130,000 profit for you.
The units in Dunas Beach Resort, Cape Verde look set to return in the region of £10,000 per year; and if capital growth continues in the area, they should only cost me £2,000 to purchase outright!
If the circumstances above sound familiar, we can help. Find me at Fresh Invest Limited.
Or call me freephone on 0800 043 69 56.
Cape Verde – The Caribbean For Europe
How many of us wish we could afford a holiday home abroad? Silly question? It’s probably all of us!
What puts you off?
1. Price
2. Being able to let it out?
3. Security?
4. Flight times?
5. Guaranteed sunshine?
Well all may not be doom and gloom, there are a few overseas developers that have taken the step of building property that is packaged in such a way as to be affordable and relatively “hands off”.
Obviously the most important factor in purchasing an overseas property is price. Our most recent “fresh” investment is in Cape Verde, the units start from £72,000 and any prospective investor will need to find 35% deposit to purchase.
Where this development comes into its own is that you can release money from your existing home to fund the deposit or alternatively source a secured loan. The developer will then pay the interest on this loan for you until completion, at which time the interest will be added to your completion price.
An interesting point to note is that Cape Verde property has been increasing by 15% per annum over the last few years, even bucking the current financial crisis. If this continues you will have made 30% worth of profit on your investment before completion, as this is 2 years off. If you then want to secure a mortgage on your chosen unit, you can do so at 75% ltv of its valued price. Realistically you could find that you actually only need to find 5% deposit, as the other 30% will have been taken care of by the capital appreciation.
As far as letting the unit is concerned, you have the option of opting in or out of a rental pool, if you opt in, all management is taken care of, leaving you free to keep the profit. At the moment 5* hotels in cape verde are running at 95% occupancy, a recent study showed a 9.5% yield based on just a 65% occupancy. Best part, you get 5 weeks personal use per year! So now you have a holiday home that not only makes you significant profit each year but also only conceivably cost you £3,600!
Security? It’s a 5* resort so security will be of a maximum, their will be creche’s for your children and the entire community is gated. Flight times? if your from the UK your there in 5 hours, half the time of most Caribbean destinations! Guaranteed Sunshine? Yes, all year round dropping to 24 centigrade over Christmas! For more details of how we can source you a great investment contact Fresh Invest Ltd.
Cape Verde Looks Set For an Exciting Future – Property Investors Take Note!
So where does Cape Verde fit? With a sunnier climate than the Canary Islands and Half the flight time of the Caribbean, Cape Verde looks set to be injected with massive investment from developers looking for the next “sure thing”. When developing or investing anywhere, the most important factor to consider is “LOCATION”.
If you can find a location that has all the benefits of its competitors but still remains relatively unspoilt, you could be on to a winner. Cape Verde offers exactly that! It’s not rocket science to realise that with increased flight costs and many people being able to take even less holiday the British public is looking for a location to holiday that they can get to quickly, won’t cost them the earth to stay and perhaps most importantly has “Guaranteed sunshine”!
Many well known developers have pinpointed Cape Verde as the Place to Be over the next few years, land and property costs still remain relatively inexpensive with apartments starting from £72,000 and villas from £150,000. If you equate this to the classier parts of Tenerife which it is competition with, they are at least 50% below Tenerife values. Perhaps the best apsect is that this country made up of 10 islands, all of which are relatively unspoilt, the government wants to retain the lush greenery of the Caribbean whilst building up select areas giving the necessary infrastructure to support the holiday trade that looks sure to increase over the coming years.
Some forward thinking property investors have already realised the potential capital growth to be gained by purchasing property in Cape Verde. Property prices have started to increase, the last 2 years capital growth has been at around 15% per annum. Prices have been so strong that they seem to have become recession proof, the predicted slow down in buying has just not happened! If you are in the market for a holiday home or have grand aspirations of retiring abroad one day, why not take a look at the Fresh Invest website. In a climate where we have all seen our pensions probably halve in value, investing in a property that you also get to use and also could give you a return in double figures may be the best thing you ever did!
Surf’s up… Invest before prices follow suit!
We love offering UK property here at Fresh Invest and none more so than the areas which are local to us. Now everyone wants a high yielding portfolio with great capital gains. The only problem being that often it is a case of the bigger the risk – the bigger the reward. This therefore means investing off plan and overseas.
However our most recent opportunity on the South Coast of the UK has all the makings of a great investment i.e:
- Massive Gentrification.
- A budding tourism scene.
- Large cash injections.
- Great discounts.
- A good rental market with possible very high yields (discussed later)
- Great Sea Front location… Never a bad thing.
Where in the UK is this so called “Investment Haven?”
Boscombe!
Yes that’s right sunny Boscombe close to Bournemouth has been receiving massive cash injections from the local government and is on the up!
Gentrification:
What does that mean? Well put simply it means “going up market” and with this comes increasing property prices and increasing rental prices. Which to you and me means Capital Growth and Rental yields Harry Redknapp has recently bought a flat in the area.
Tourism:
With the majority of the British public strapped for cash due to the current economic climate they will be looking to holiday in the UK. Not to mention the weakness of the pound this is making holidaying abroad a very expensive luxury.
Coupled with this is the development of the UK’s first artificial surf reef! That is sure to bring in some revenue for the surrounding area.
The newly refurbished “Beach Pods” Designed by Wayne Hemmingway (Red or Dead) have just been released for sale and have really bought a modern and vibrant look to the beachfront.
Yields:
One thing with property in holiday locations is that the rents chargeable can become massively inflated in the summer months meaning that if you could secure a long winter let and then regular summer lets you could be on to a property with a very high rental yield!
For more information on our Boscombe opportunity click here
Or freephone on 0800 043 69 56
You don’t need a crystal ball, just look to the past!
Everybody seems to be waiting with baited breath for sure signs that the property market is on the up.
I liken it to being a child just about to take that first jump on your bmx, you spend all day making the jump then all gather at the top of the hill ready to go. Then you all stop, look at each other, daring the other to go first.
This is how i see many of us in the property market.
Nowone wants to be the first, we all need to know that someone has taken that jump before us!
If we take a quick history trip back to the second half of 1992, the market was just beginning to emerge from the doldrums of the late 80′s.
If we use Halifax’s figures, the average price in 1990 was £69,000, by 1992 it was £61,000, however, as we entered the millenium it has climbed to £81,500, a 15% increase.
In London prices has skyrocketed from £76,000 to £142,000!
This explains the recent increase in viewings in the capital.
The other explanation is easily explained if you look at the typical house buyer at the moment.
They fall directly into the middle age, middle class category.
These individuals were either at university or not on good enough wages to take advantage of price increases in the early 90′s. However, since then many have worked hard and are now in a solid job, having regularly paid off their mortgage.
These are the types of people that see an opportunity, they are also the people that are in the best position to take advantage of it.
The downturn in the market has resulted in the North/South divide widening again, where most southerners seem to have a larger amount of equity, this has allowed them to ride out the downturn in relative safety; whislt also paying off massive chunks of their mortgage thanks to the low base rate.
Because of this they are now in the ideal position to pray on an underperforming market.
Lenders are heavily favouring investors with large deposits and good jobs which is exactly the demographic many of these investors fall into.
Whilst i still think the property market has another 10% drop in it, i’m buying, the reasons?
I would rather pick up a high yielding property off a desperate seller in a declining market than a property off a confident seller in a buoyant market.
If you are worried about the 10%, offer 10% below market value, your more likely to get it now and take advantage of low mortgage rates than after the market has turned!
It’s all the NINJAs fault!
As we all sit around wondering why our shares are worth 50% of their initial value and our savings are returning a staggering 2% per annum, i think its time to blame NINJAs, or more importantly, the people that lend them money!
If your thinking, he’s finally lost it, hold on and let me explain.
I’m not talking about the type of NINJAs that wear black pyjamas and lurk in dark places! Im talking about “No Income, No Job, No Assets” N.I.N.J.A.s.
It’s because the lenders lent money to these massively high risk characters that we are in the poaition we are today.
There is a reason NINJAs do not own their own houses and it’s generally because they can’t afford both the deposit and the monthly mortgage payments. With 100% mortgages available many high risk applicants decided the time was ripe to take their first step onto the ladder.
Suddenly all the spare cash that was swilling around at the beginning of the century was quickly used up, much to the lenders delight.
Bankers then took all of these loans, mixed in some better ones and sold them to other banks who found the high interest rates attractive.
The problem arose when these “fixed rate” mortgages came to fruition!
Suddenly Joe Blogs went from paying an affordable rate to one miles outside his comfort zone, they default on their payments and the heavily traded loans that were made are found out to be be worth about the same as the paper they were printed on!
This may have been manageable if their hadn’t been over $1 trillion worth of these loans in the market!
Any lender with a high risk business model eventually came a cropper as banks bit the bullet and decided to stop lending to one another.
From there on i’m sure you all pretty much know the story, banks are “helped out” by the Government and we all eventually suffer.
One point worth noting is that the banks that took these massive gambles that eventually doomed us all were rewarded by being taken over by the Government!
Interesting seeing that if any small business owner made such a colossal cock up we would be on the street before we could say Northern Rock!
