This election could mean boom or bust to the already fragile property market in the UK.

As we all know, possibly the largest challenge facing the new government will be our economy. The 3 big parties have outlined the steps they will take to try to deal with the £170bn deficit in the UK’s finances.

With it looking increasingly like a hung parliament, what will be the main points of debate from these parties on our property market?

Listed below are some of the key points of each party.

Conservative:

• Scrap home information packs
• Keep the £250,000 stamp duty threshold for the foreseeable future
• Add a new 5% stamp duty threshold for £1m properties from April 2011
• Increase inheritance tax threshold to £1m
• Regards Northern Rock, they have not stated whether they will consider remutualisation
• Include more local initiatives rather than large scale regional building plans
• Will look to split state and part owned banks into 2 parts, retail and investment

Labour:

• Add a new 5% stamp duty threshold for £1m properties from April 2011
• Keep the homebuyer direct scheme for low earners
• Keep Home Information Packs
• The £250,000 stamp duty threshold is due to expire in March 2012
• 10,000 affordable homes to be built a year by 2014
• Northern Rock: Manifesto pledge to consider remutualisation as an option, ‘while ensuring the sale generates maximum value for the taxpayer.’
• Will look to break up large banks but probably not into retail and investment
• Maintain the standard interest rate on the Support for Mortgage Interest Scheme at 6.08 per cent until December 2010.

Liberal Democrats:

• Charge VAT on new homes
• 1% “supertax” on homeowners with properties worth over £2m.
• Create a new “Safe Start” mortgage that keeps buyers from slipping into negative equity
• Propose a green loan for people to invest in home energy efficiency and micro-renewables
• Get rid of home information packs and keep energy performance certificates
• Consider remutualisation regards Northern Rock
• Will split state and part owned banks into retail and investment
• Concentrate on local rather than large regional building plans.

Fresh Invest is a property investment company with the aim of maximising our investor’s funds whilst minimising their risk. For more information see www.freshinvest.co.uk or phone 0800 043 69 56.

I’ve done it again!

If you remember i blogged in september regarding a lack of supply leading to increased prices, well it seems mortgage solutions agrees……better late than never! See their article here.

I personally i think they missed the biggest point which is the slow down in new build development. But you get the same result.

We still have a few new build developments with discounts available, if you are looking for a property investment click the link!

Another option is to buy a student property, some of our wealthiest investors specialise totally in student accommodation investment. A couple of them have yields close to 20% on massive portfolio’s!

Some investors don’t like the hassle of student property but if you have a management company set up all you need to do is collect the profits!

It’s what most of us have been waiting for, the small time frame between lenders relaxing their criteria and property prices increasing.

We all knew that lenders were going to need to increase their loan to value rates, and that when they did it would make a massive difference to the property investment market.

Over the past few months half decent rates had been reserved for investors with 40% deposits. Now i do not condone most no money down deals, i think they lead to more problems than they alleviate.

However! the case for the investor with a healthy 20% deposit should be heard, they have a large amount of equity in their property and should now be relatively safe from negative equity.

It seems the lenders now agree.

What are the new rates like?

Since the BOE base rate reached 0.5% products requiring a 15% deposit have risen from 169 to 231. And the number of products requiring just 10% upfront has gone up from 89 to 105 in the last month alone.

This is certainly a massive difference to a year or even 6 months ago.

Nationwide has already announced a new influx of deals, including some at 85% loan to value and they have also released some of their best rates at 70% ltv, from their previous at 60%.

They have even released a special 90% ltv rate for investors that hold one of their flexaccounts. These start at 4.63% for a 2 year tracker.

The Woolwich have also released details of their new 75% ltv rates, this is the first time the lender has made it to 75% for at least a year. The new mortgages include a lifetime tracker on 2.94% and 2 year fixed on 3.99%.

Abbey also have a new range out, these are exclusively for their current account customers. One of their best is a 90% ltv 3 year fixed rate at 5.99%, their cheapest mortgages are now available at 70% from 60%.

So why the sudden change?

It seems that lenders now believe that the worst is behind us, in short if they are offering 90% ltv mortgage they believe that property prices will not drop more than 10%, in fact they believe that prices will increase in the future, as now being reported in most news channels.

Just last month hsbc pledged to lend an extra £500m at 90% ltv by the end of this year!

Add this to the political pressure being put on lenders by the government, this was summed up by the governments own lending house northern rock as they released some of the best ltv rates seen for over a year!

So should i buy now?

If you are looking at getitng into property investment there has never been a better time to invest, there are still seller under pressure but now there is also the promise of some competitive rates. This means that not only can you buy cheap, you can also borrow cheaply!

We don’t expect this to remain the case for long so why not add or start your portfolio with some discounted property now!

Also check out our UK Buying Guide for handy hints and tips.

Shopping at the weekend I was amazed at how busy all the shops were, now I know it’s christmas and all that but perhaps this could be the final piece of the puzzle that will lead to us climbing out of recession.

It does seem for the first time in months that the public are not as worried as they were about the economy.

According to the times, people are more optimistic about the economy than at any time over the last 18 months.

What are the reasons for this?

1. We have just had the highest october high street sales for 7 years.
2. The pound rose to it’s highest level against the dollar.
3. The ftse closed up 92.5 points, at a two week high.
4. Alistair Darling is looking at cutting business taxes to encourage people to have faith in labour.

What do people think about these facts?

Is this a result of the “quantitive easing” which we (the public) are going to be penalised for after the elections?

or

Is this the start of Britain pulling itself out of recession?

Could the points above be the catalyst that leads to us out of our economic quagmire?

What does this mean for the property investment market?

In my opinion it means that the worst is now firmly behind us, the increased confidence on the high street coupled with the low supply of new build property coming on the market means robust values.

Investors can now take advantage of a unique position in the property investment market. There are still a small amount of reposessed property and good discounted new build units available which if bought now are sure to increase in value over the next year.

Investors purchasing these can then re-mortgage on much better loan to value rates.

The property investment market is ripe at the moment, will investors choose to invest or wait until the moment has passed and lament on a missed opportunity?

As always, we will probably see both.

If you want details of some of our UK Buy to Let Opportunities at the moment please let us know, they are selling fast!