Property Investors Warned To Choose Potential
Property Purchases Wisely
Savvy property investors know that profit is made when buying property, not when it is sold, as equity can be locked in upon purchasing below market value, giving the property investor greater control of the purchase price by negotiating a deal with the seller, (vendor), […]
Property Investors Should choose Investment Properties Wisely
Property Investors Warned To Choose Potential
Property Purchases Wisely
Savvy property investors know that profit is made when buying property, not when it is sold, as equity can be locked in upon purchasing below market value, giving the property investor greater control of the purchase price by negotiating a deal with the seller, (vendor), rather than what the property eventually sells for on the open market.
Property investors are different from ordinary residential property buyers, as they are of the mindset that the property should meet all the financial requirements of a landlord first & foremost, rather than paying the high end retail price for a property just because it looks nice.
Many new and amateur property investors make the common mistake of falling in love with a property and begin to let their heart rule their head, becoming so emotionally involved that they lose control of their finances and let their emotions win, overspending massively and reducing any potential yield.
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Beware Of Serious Maintenance Issues When Purchasing Investment Properties
25% of properties for sale in the UK
have serious maintenance issues
New research by Halifax home insurance has revealed that home owners are far from proficient at keeping their property well maintained.
The research found that whilst 28% of home owners claim to be DIY enthusiasts, almost a third of people surveyed said they only had basic skills and knowledge to carry out basic cosmetic improvements, such as painting and decorating, grouting tiles or assembling furniture rather than tackling bigger property maintenance issues such as cleaning gutters and repairing fixtures and fittings or repairing cracks in plaster.
lacking the confidence to undertake even straightforward maintenance which could prevent problems such as damp in the longer term,
The research found that property owners in Aberdeen had the best maintained properties in Scotland, while Peterborough was the top region in England, and Newport came out top in Wales.
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Did you know that UK mortgage interest rates last peaked 22 years ago?
Is it a surprising coincidence to anyone looking for cheap mortgages that mortgage interest rates have been raised by the Halifax and other lenders this week?
Remarkably the timing of the announcements of Mortgage interest rate rises by Halifax, Santander and Royal Bank of Scotland had absolutely nothing to do with marking the anniversary of the last mortgage rate peak.
Mortgage interest rates last peaked in the UK more than two decades ago, as noted by another leading high street bank.
HSBC have pointed out that March 4th 2012 was the 22nd anniversary of the mortgage peak, when mortgage interest rates reached 15.4%
The bank also noted that March 3rd 2012 was also 3 years to the day since the Bank of England (BoE) base rate fell to its historic low of 0.5%.
March 4th 2012 marked the day when lenders decided that there was money to be made from UK property again as Halifax announced plans to increase its standard variable rate (SVR) from 3.50% to 3.99% on 1 May for around 850,000 customers.
Halifax is also increasing its Halifax Variable Rate 2 and Halifax Flexible Variable Mortgage Rate from 3.40% to 3.89%.
Also marking Mad March, UK publicly owned bank the Royal Bank of Scotland has increased the interest rate on two mortgage products – its RBS and Natwest Offset Flexible Mortgage and the RBS One Account Mortgage – by 0.25% effective from 1st March and 1st May respectively.
For the majority of the roughly 200,000 customers affected, the new rate will be 4% – the same as the banks’ standard variable rate, which RBS is keen to stress has not changed.
Santander increased the interest rate on four of their mortgage products on Friday 2nd March – the two-year fix and tracker deals at 60% LTV and 75% LTV sold though its Abbey Intermediaries channel – by 0.10%.
The increase, however, will only affect new customers – there will be no change to existing customers’ rates.
The UK mortgage market has seen many changes over the last two decades or so, including the average price of a house rising from £69,240 (GBP) to £160,907 (GBP) and the size of a typical home loan agreement escalating from £35,000 (GBP) to £120,400 (GBP). The highest standard variable rate for borrowing fell from 15.4% to 6% in the same timeframe.
Q. Why is anyone hiking anything with the Bank of England (BoE) base rate still so low?
Usually when a lender hikes its standard variable rate (SVR) it is in response to a change to the Bank of England base rate.
However, the BoE base rate has been at a record low of 0.5% for 3 years already and is expected to remain low until at least 2014 – more likely 2016, according to experts at the Centre for Economics and Business Research (CEBR).
So why are lenders hiking mortgage rates now?
- Other than the obvious answer of … Because they can!
UK property is still alive, well and is still producing a profit!
Property investors have always known this and now the banks are finally realising that there is money to be made from UK property!
Happy Anniversary!
