Property Investment Market Update for 2011
Commentary
If you have cash as a property investor, or are making your money from buy to let, then 2011 should be a pretty good year for you!
Increase in Below Market Value Deals
This year has already seen an increase in activity, particularly at the auction houses. So a fab time to go hunting for a bargain! Do check out the legal pack and make sure your finances are ready to go on the day.
AVOID like the plague property investment deals that offer to purchase a property at BMV for £5k or less, it's typically a scam, you are unlikely to get a good investment and worst still you are even more unlikely to get that money back! See Ajay Ahuja.
Property Investment Finance
Finance is still tough for property investors as banks are still preferring to hang on to the capital rather than invest it in property! The good news is the likes of Paragon Mortgages, specialist property investment and buy to let lenders are back in the market and keen to invest in successful, professional landlords that are running their investments as a business.
Don't forget to look at and consider building to let or building and selling on - you can make a 30% margin if you do it right! Consider self build finance.
What Property Investment Deals will work in 2011?
This partly depends on what time you have available crossed with the cash you have and how happy you are to take on risks.
Property Investments to Consider in 2011
If you can secure a bargain via the auction houses or someone that wants to avoid repossession, then investing in buy to let can deliver good returns - but make sure you can still afford the investment if mortgage rates hit 7-8%.
This is definitely the year for self build as the government is looking to reduce the planning laws that apply and it's worth considering, especially as you may get away with an initial deposit of just 15% at each stage of the build.
Also consider farmland which is growing in value in the UK and there are some areas abroad that may well give you a good return - but research carefully!
Property Investment to Avoid during 2011
Beware that there are some investments that unless you are extremely experienced at, they probably won't pay back this year:-
- 'No money down deals'
- Buying properties in poor economic areas if you are hoping for capital growth
- Buying options without checking what works are required on the property/ies
- Property investment clubs selling 'get rich quick' schemes
Headline Statistics
There are no real statistics that regularly track property investment, however below are links to some of the most useful stats on property investment.
The Council of Mortgage Lenders (CML) has released its third quarter BTL results report. Savills have issued their latest residential investment research report
Spotlight on Residential Investment Winter 2010/11.
Other useful Resources:-
PROPERTY SECRETS ASSETZ SAVILLS KNIGHT FRANK GLOBAL PROPERTY GUIDE
LANDLORD MAGAZINE PROPERTY INVESTOR NEWSCOUNCIL of MORTGAGE LENDERS
Their statistics supply a wealth of useful data, however since 2009 they now charge an enormous fee of over £7,000 per year to access their data. Clearly the credit crunch is also affecting CML funds! If you are a journalist you may be able to contact their press office for statistics.
For more market commentary on a national or local level:-
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