Lofty apartments in London's prime boroughs, chic chalet's in the finest Alpine ski resorts of France and Switzerland, and 2 bed semi's in Salford. Spot the odd one out?
While there may be many reasons making the 2 bed semis in Salford the odd one out, investment potential is not one of them according to British institutional investors, who have invested heavily in British housing stock in the last 12-18 months, to capitalise on the current rental boom, and solidify their investments away from the tumultuous global stocks and bonds markets.
According to data just released by Her Majesty's Revenue and Customs, financial institutions invested £2.2 billion in UK houses and apartments in the year ending April 2011, a 189% increase over the previous year.
Specialist property companies also increased their exposure to UK buy to let during the period, the data shows that such firms purchased £7.5bn worth of UK rental properties, which is a 27 percent increase over the same period in 2010. Wealthy British individuals are also getting in on the action. They invested a combined £193.8 billion in the year ending April, which is surprisingly only a 24% increase over 2010.
The growth is hardly surprising. The financial world is a scary place, and the stock markets are even scarier. The Eurozone debt crisis is making any European investment a high risk strategy, especially now with some reports indicating that banks are putting in place contingency plans for the Eurozone's complete break-up, although few believe this will come to pass.
Never the less, this makes British property one of the few safe investments in Europe. Property is far less volatile than stocks, and of course, Britain stayed out of the euro, so, while it would suffer a shock if the Euro collapses, its property market will see a far smaller hit than those in the Eurozone.
On top of the long term safety of British property, the rental yields are currently very attractive in the short-mid term as well, with the constrained mortgage market, lack of affordability and housing shortage continually drive up rental demand. The latest data rents and yields are growing across the country. The latest Residential Lettings Survey from the Royal Institution of Chartered Surveyors said that 15% more chartered surveyors reported rental yields rose rather than fell in the three months ending October. This is the 7th consecutive quarter of rising yields according to RICS.
Tuesday, December 27, 2011
Friday, December 23, 2011
London Property for Sale With Possibility of Extending, Queens Park
Brondesbury Villas, Queens Park, London, NW6
A spacious (826 sq ft) well presented two double bedroom two bathroom garden flat set within an attractive four storey semi-detached period property on one of the most desirable tree lined streets in Queens Park. The property is situated a short walk from Queens Park underground station (Bakerloo Line) and the variety of shops, gastro pubs and deli's along Salusbury Road.
The accommodation comprises an entrance hall with wood floors and a fitted storage cupboard; a modern family bathroom incorporating a white three piece suite with fully tiled walls/floors; an 18' front facing reception room with wood floors and a gas fireplace with wood surround; guest cloakroom and a separate fully fitted kitchen with integrated appliances.
Further benefits include a 15' master bedroom with fitted wardrobes and direct access to the private rear garden, an ensuite shower room with extractor fan, the second double bedroom with direct access to the private rear garden, side access to the 53' mature rear garden and a private front garden. The property also has potential for a single storey rear extension (Subject To Planning).
Queens Park Garden Flat for Sale
Tuesday, December 20, 2011
House Prices Remain Stable in November
There was no movement for house prices in the UK in November, according to the latest England & Wales House Price Index from LSL Property Services/Acadametrics.
However, just because house prices have remained static, people should not assume that they are not becoming more affordable.
David Brown, commercial director at the firm, said that zero growth means that in real terms houses are becoming more affordable.
"With inflation running at five per cent the real cost of property is getting smaller and smaller, which is good news for buyers and mortgage borrowers alike," he added.
The data showed that the average house price in the UK now stands at £220,043.
Mr Brown said that while over the past year house prices have dropped 0.7 per cent, low mortgage rates, the stamp duty holiday and the government's FirstBuy scheme have prevented larger falls.
Recent data from Halifax showed that 2011 has so far seen five months of price falls and the same number of rises, with one month of no change.
Mortgage Rate & Home Loan News
However, just because house prices have remained static, people should not assume that they are not becoming more affordable.
David Brown, commercial director at the firm, said that zero growth means that in real terms houses are becoming more affordable.
"With inflation running at five per cent the real cost of property is getting smaller and smaller, which is good news for buyers and mortgage borrowers alike," he added.
The data showed that the average house price in the UK now stands at £220,043.
Mr Brown said that while over the past year house prices have dropped 0.7 per cent, low mortgage rates, the stamp duty holiday and the government's FirstBuy scheme have prevented larger falls.
Recent data from Halifax showed that 2011 has so far seen five months of price falls and the same number of rises, with one month of no change.
Mortgage Rate & Home Loan News
Wednesday, December 14, 2011
10% Increase in October Mortgage Agreements
It’s not all doom and gloomy in the mortgage market says leading broker John Charcol.
The mortgage advisory firm says that despite media reports of a subdued market place, purchase business for residential property and buy to lets is actually performing quite well and there is a glut of suitable products available.
Simon Collins, product and technical manager at John Charcol, said that it saw a ten per cent increase in the amount of mortgages agreed during October compared with the same month in 2010.
“Despite the approaching festive season, we have seen the number of good quality purchase enquiries hold up very well, so whilst the market’s not great, it’s not as bad as it’s being painted,” he stated.
Last week, the latest Mortgage Monitor from chartered surveyors e.surv found that mortgage approvals for property purchases during November reached its highest number since December 2009 and were up some 15 per cent on November 2010.
Mortgage Rate and Home Loan News
The mortgage advisory firm says that despite media reports of a subdued market place, purchase business for residential property and buy to lets is actually performing quite well and there is a glut of suitable products available.
Simon Collins, product and technical manager at John Charcol, said that it saw a ten per cent increase in the amount of mortgages agreed during October compared with the same month in 2010.
“Despite the approaching festive season, we have seen the number of good quality purchase enquiries hold up very well, so whilst the market’s not great, it’s not as bad as it’s being painted,” he stated.
Last week, the latest Mortgage Monitor from chartered surveyors e.surv found that mortgage approvals for property purchases during November reached its highest number since December 2009 and were up some 15 per cent on November 2010.
Mortgage Rate and Home Loan News
Friday, December 09, 2011
Refurbished Queens Park Apartment for Sale
Hartland Road, Queens Park, London, NW6
A newly refurbished ground floor one bedroom flat within this period terraced period house in the heart of Queens Park.
The property is situated along a popular tree lined street just a short walk to the Bakerloo and overground stations at Queens Park and the plethora of local cafes, restaurants and shops along Salusbury road.
The accommodation comprises of a reception with wood floors, high gloss open plan fitted kitchen with appliances, double bedroom with an en suite shower room and direct access to the communal rear garden.
Further benefits include a luxury fitted shower room with a heated towel rail and an extractor fan, double glazing, gas central heating, entryphone system and no upper chain.
The property has been completely refurbished and an early viewing is strongly advised to avoid disappointment.
Queens Park Apartment for Sale
Monday, December 05, 2011
Landlord and Tenant News: Landlords set to expand their portfolios in 2012
The coming 12 months look set to be a boom time for buy-to-let investors, with many looking to significantly increase their property portfolios.
Research conducted by specialist mortgage provider Paragon found that landlords are practically falling over themselves to invest further funds in bricks and mortar at present despite the traditional market being subdued.
Indeed, more than a fifth of those surveyed said they will be making more property investments in 2012.
While in contrast, less than one in ten landlords claimed that they will be looking to reduce the size of their buy-to-let portfolios in the 12 months.
Thanks in part to a loosening of lending restrictions from banks and building societies, the number of properties owned by rental magnates has risen to an average of 13 this year and will continue to rise further in the next year.
Terraced property remains the most popular choice for landlords with 65 per cent of respondents saying that they owned at least one.
This was followed by flats or apartments, which are owned by 58 per cent. Semi-detached homes made up part of 48 per cent of landlord's existing portfolios while 24 per cent own a House of Multiple Occupancy (HMO).
Of those questioned 77 per cent stated that they were positive about being a landlord, while 57 per cent said prospects for the rental sector in 2012 were either "good" or "very good".
"This is an interesting time for the private rented sector as landlords are experiencing very high levels of tenant demand as other areas of the housing market come under increasing strain," John Heron, Paragon Mortgages managing director, said.
"I am pleased to see that landlords are expecting to add to their portfolios as there is no sign that tenant demand is going to slow in 2012."
Iqbal Hussain, property consultant at Knight Knox International, recently said that now is the best time to buy for anyone wanting to dip their toe into the property rental market.
Property News Magazine
Research conducted by specialist mortgage provider Paragon found that landlords are practically falling over themselves to invest further funds in bricks and mortar at present despite the traditional market being subdued.
Indeed, more than a fifth of those surveyed said they will be making more property investments in 2012.
While in contrast, less than one in ten landlords claimed that they will be looking to reduce the size of their buy-to-let portfolios in the 12 months.
Thanks in part to a loosening of lending restrictions from banks and building societies, the number of properties owned by rental magnates has risen to an average of 13 this year and will continue to rise further in the next year.
Terraced property remains the most popular choice for landlords with 65 per cent of respondents saying that they owned at least one.
This was followed by flats or apartments, which are owned by 58 per cent. Semi-detached homes made up part of 48 per cent of landlord's existing portfolios while 24 per cent own a House of Multiple Occupancy (HMO).
Of those questioned 77 per cent stated that they were positive about being a landlord, while 57 per cent said prospects for the rental sector in 2012 were either "good" or "very good".
"This is an interesting time for the private rented sector as landlords are experiencing very high levels of tenant demand as other areas of the housing market come under increasing strain," John Heron, Paragon Mortgages managing director, said.
"I am pleased to see that landlords are expecting to add to their portfolios as there is no sign that tenant demand is going to slow in 2012."
Iqbal Hussain, property consultant at Knight Knox International, recently said that now is the best time to buy for anyone wanting to dip their toe into the property rental market.
Property News Magazine
Friday, December 02, 2011
International Students Demand Luxury Letting Property
Cash rich students from overseas are increasingly looking at the more luxurious end of the rental market.
Jonathan Moore, director of EasyRoomMate.com, said that while student homes still often have the reputation of being far from grandiose, students are becoming more choosy and those from overseas in particular are looking for properties in more affluent districts.
"With the increase of demand from international students with bigger budgets, we are seeing a niche luxury lettings market emerge in many university towns, with investors targeting higher rents - albeit from a bigger investment," he said.He added that, despite this, changes in the HMO [house in multiple occupation] licensing requirements mean that all property let to students is now of a decent standard.
Research conducted last month by specialist mortgage provider Paragon found that student lets still offer a landlord the highest possible yield, with an average of 7.62 per cent.Properties let on a shared basis by professionals was the second best performer at 7.56 per cent.
Landlord and Tenant News
Jonathan Moore, director of EasyRoomMate.com, said that while student homes still often have the reputation of being far from grandiose, students are becoming more choosy and those from overseas in particular are looking for properties in more affluent districts.
"With the increase of demand from international students with bigger budgets, we are seeing a niche luxury lettings market emerge in many university towns, with investors targeting higher rents - albeit from a bigger investment," he said.He added that, despite this, changes in the HMO [house in multiple occupation] licensing requirements mean that all property let to students is now of a decent standard.
Research conducted last month by specialist mortgage provider Paragon found that student lets still offer a landlord the highest possible yield, with an average of 7.62 per cent.Properties let on a shared basis by professionals was the second best performer at 7.56 per cent.
Landlord and Tenant News
Thursday, December 01, 2011
Her Majesty’s Revenue & Customs is Declaring War on Stamp Duty Avoidance.
It is to mount a court challenge to determine the legality, or otherwise, of stamp duty tax avoidance schemes.
Central to the challenge will be the use of limited companies to buy properties, and then sell them to individuals – something which does appear to be completely legal.
Essentially, the purchaser sets up a Special Purpose Vehicle, a company or a trust with a property as its sole asset. The purchaser then buys shares in the company and is subjected to a tax rate of just 0.5%.
There are many companies offering stamp duty tax avoidance: a Google search yielded over 3,200 results.
The taxman’s move follows this year’s Budget when Chancellor George Osborne announced that he would be clamping down on stamp duty avoidance, whilst law firms have also warned that HMRC is on the prowl.
HMRC estimates the tax avoidance schemes have cost it millions in lost revenue. It is investigating 1,200 people it suspects of having underpaid stamp duty by a collective total of £35m, whilst it will also go after others who have avoided the tax altogether.
The many schemes that claim to legally exploit stamp duty loopholes frequently charge fees of around half the amount that would have been paid in tax.
It is thought that a number of property investors have set up a limited liability company to buy the property to sell back to the individual.
An HMRC spokesperson said: “The schemes rely on an interpretation of law that produces an outcome different from that envisaged when the law was enacted, and that HMRC does not accept.”
Central to the challenge will be the use of limited companies to buy properties, and then sell them to individuals – something which does appear to be completely legal.
Essentially, the purchaser sets up a Special Purpose Vehicle, a company or a trust with a property as its sole asset. The purchaser then buys shares in the company and is subjected to a tax rate of just 0.5%.
There are many companies offering stamp duty tax avoidance: a Google search yielded over 3,200 results.
The taxman’s move follows this year’s Budget when Chancellor George Osborne announced that he would be clamping down on stamp duty avoidance, whilst law firms have also warned that HMRC is on the prowl.
HMRC estimates the tax avoidance schemes have cost it millions in lost revenue. It is investigating 1,200 people it suspects of having underpaid stamp duty by a collective total of £35m, whilst it will also go after others who have avoided the tax altogether.
The many schemes that claim to legally exploit stamp duty loopholes frequently charge fees of around half the amount that would have been paid in tax.
It is thought that a number of property investors have set up a limited liability company to buy the property to sell back to the individual.
An HMRC spokesperson said: “The schemes rely on an interpretation of law that produces an outcome different from that envisaged when the law was enacted, and that HMRC does not accept.”
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