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Where Will Property Investors Get The Best Return From In 5 Years Time?

Where Will Property Investors Get The Best Return From In 5 Years Time?

Where Will Property Investors Get The Best Return From In 5 Years Time?

Savills have released their UK property price predictions for the next 5 years identifying what they think are the best UK regions to purchase properties in based on expected Capital Gains.

Residential properties in the South East region are predicted to increase in value by as much as 31.9%, whilst the East of England could see property prices rise by 30.4%.

In the South West region of the UK, Savills expect property prices to jump by 29.4% with increases in property values not increasing by as much in more Northern parts of the UK.

According to the 5 year forecast, East-Midlands property prices could increase by as much as 24.6%, however, London property prices are only expected to rise by 24.4%.

West-Midlands property prices are also expected to increase by up to 23.4% according to the forecast, but property prices in Wales are only predicted to increase by 21%

The city of York in the Yorkshire & Humber region could expect property price rises around 20.5% according to Savills and over the Pennines in the North West, property prices are estimated to increase by 19.3% in next 5 years, as is also the case in Scotland.

North East property price predictions are the worst of the company’s forecast only expected to grow by 17.6% over the next 5 years.

The property price predictions do not appear to take into account the effect of the Help-To-Buy scheme on the UK property market, nor do they allow for the prospect of another property price bubble or even another huge property crash.

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If you have ever wondered about how property investment could be the way for you to quit your j.o.b and change your lifestyle for the better, then take a look at the offer below from our friends at Platinum Portfolio Builder

How Property Investment can change your life!

  • Are you serious about Investing?
  • Are you looking to build a Buy-To-Let property portfolio but don’t have the time to manage it?
  • Are you looking for properties in prime locations at significantly discounted prices?
  • Do you want higher yields on your investment?
  • Would you like to benefit from lucrative assembled bulk deals?

…If you would answer YES to the questions above, then you might want to talk to us!

 

Whatever your requirements … Platinum Portfolio Builder knows how to invest for your future

8 two bedroom apartments located on a modern housing estate

 

Purchase Price £400,000
Expected Valuation £600,000
Purchase Costs £15,600
Refurbishment Costs £2,000
Equity £182,400
Discount 30.04%
Annual Rent £42,900
Gross Yield 10.27%

Head of Property Buying at Platinum Portfolio Builder, Dean Thompson has this lucrative offer for property investors:

 

An exciting opportunity has arisen to purchase 8 two bedroom apartments located on a modern housing estate, within a larger block. 75% of the apartments are currently let with active marketing taking place for the remaining apartments. A rental income, when fully let is estimated to be £42,900

Now that you have seen a brief snapshot of HOW Platinum Portfolio Builder do it, find out WHY people like us invest with them…

Not only do Platinum Portfolio Builder buy properties on a large scale, they can tailor property purchases to everyones individual needs, just like the property portfolio PPB are building for Chris and his wife Natalya. All at a minimum of 25% below genuine market value (BMV)….

So, why did Chris and Natalya invest with Platinum Portfolio Builder?

  • “Even though we have investment experience, we’re m no property experts. What really attracted us to Platinum Portfolio Builder was the fact that we could get at least four properties in our property portfolio using just £75,000 (GBP) of our own money”.
  • “Without third party property investment services, we could never have got into property investment on our own “.
  • “The great thing with PPB is that all of the properties they secure for their clients are cash flow positive from day one”.

Chris and Natalya, Platinum Portfolio Builder Clients

“Our plan is to get about 16 properties in total that we can use them to support our family, and pass down to our children in the future.”

A typical property from a PPB portfolio

Purchase Price £77,000
Expected Valuation £110,000
Purchase Costs £1,250
Refurbishment Costs £3,100
Equity £27,500
Discount 26.05%
Annual Rent £5,400
Gross Yield 7.01%

  

 

Disclaimer

Please note that Platinum Portfolio Builder is not authorised or regulated by the Financial Services Authority and as such is not permitted to offer financial or investment advice to UK resident investors, whether or not the intended investments are regulated or unregulated. We strongly encourage you to consult an FSA-authorised Independent Financial Adviser before committing to any form of investment.

The profitability of this investment can go down as well as up. Historic performance should not be taken as a guarantee of future returns. This investment can increase the risk of losing money as well as increase the possible gains. Bank interest rates may increase during the term of the project. This is a non regulated investment and is therefore not covered by the financial services compensation scheme.

 

 

Property Prices Increase As New Houses Built

Property Prices Increase As New Houses Built

Property Prices Increase As New Houses Built

On Tuesday, it was revealed that the Royal Institute of Chartered Surveyors (RICS), said 21% of its members had reported an increased workload during the second quarter of the year.

The poll, the most upbeat since the start of 2007, indicated that the reported recovery of the UK property market was widespread, with surveyors in almost all of the UK’s regions and industry sub-sectors becoming busier.

The best-performing regions were London and the South West, often referred to as the driving force behind the UK property market, while the worst region was Northern Ireland, the only part of the UK where RICS surveyors continue to see their workload shrink.

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Residential property affordability is at its most favourable in almost a decade, according to the latest Lloyds TSB Affordable Cities Review.

My home town of Salford, in the North West, is the most affordable UK city with an average property price of £102,391 that is 3.81 times the average gross annual earnings.

This partly reflects a 32% fall in house prices in this part of Greater Manchester since 2008.

The average price for a home in a UK city is £173,202 equating to 5.5 times the average gross annual earnings.

This is an improvement on 5.7 times the average gross annual earnings in 2011 and is significantly below the peak of 7.2 times the average gross annual earnings observed in 2008.

10 most affordable UK cities, 2012

UK cities

Region

Price to Earnings ratio

Salford

North West

3.81

Londonderry

Northern Ireland

3.87

Bradford

Yorkshire and the Humber

3.98

Lancaster

North West

4.00

Stirling

Scotland

4.04

Belfast

Northern Ireland

4.08

Durham

North

4.08

Lisburn

Northern Ireland

4.09

Hereford

West Midlands

4.26

Birmingham

West Midlands

4.43

UK cities average

 

5.51

Sources: Lloyds Banking Group, ONS

The marked improvement in affordability in UK cities over recent years has been driven by the significant fall in residential property prices.

Since 2008, the average house price within a city has fallen by 18% (£37,403) from £210,605 in 2008 to £173,202 in 2012.

  • 7 out of the 8 most affordable cities are in Northern Ireland and the North of England.
  • Ely in the East of England is the most affordable city in the south of England (4.60).

The least affordable city in the UK is Truro in the South West where the average property price (£250,489) is nearly ten times (9.71) the average gross earnings in the area. The benefits to the quality of life associated with living in this picturesque part of Cornwall have supported residential property prices in this area for the past decade.

Oxford (8.80) is the second least affordable city, followed by Winchester (8.76). Inverness (5.97) and York (5.95) are the least affordable cities outside Southern England.

Suren Thiru, housing economist at Lloyds TSB, commented: “The improvement in housing affordability within many of our major urban conurbations has been significant during the past few years and reflects the decline in house prices over the period. There is, however, a distinct north-south divide to the locations of the most affordable UK cities. Looking forward, the marked improvement in city affordability is likely to help support demand for those able to enter the housing market. Much of this benefit, however, maybe offset by the continuing difficulties many households face in raising a deposit and uncertainty over the outlook for the UK economy.”

UK landlords with rent guarantee insurance stay happy despite property doom and gloom

Landlords with Rent Guarantee insurance remain happiest

New data released by Nationwide and Hometrack show that overall UK residential property values have fallen when compared to this time last year and the fall has been attributed to the changes in stamp duty.

The average residential property value in March 2012 was £163,327. That is 0.9% lower than property prices were in March 2011, the largest fall in UK house prices since June last year.

Nationwide’s figures showed a fall in nearly every region of the UK, compared with the previous quarter and data from Hometrack shows a clear North – South divide.

However residential property prices increased by 0.6% in the north of England, property values also increased in Scotland, and Greater London.

UK mortgage applications were also affected by Stamp duty changes, approvals dropped to 48,986 in February 2012, some 9,000 lower than the 25-month high recorded in January 2012, the lowest mortgage approval figures for three years, according to the Bank of England.

UK residential property prices may have fallen for the first time in six months, but UK landlords with Rent Guarantee insurance are still smiling.

Buy To Let landlords remain unfazed by the dip in UK residential property prices as they continue to maximise their rental returns, as demand for rental property continues to increase. In fact BTL landlords have been experiencing higher rental yields during the past 6 months than at any other time since the economic crash in 2007.

UK landlords are utilising specialist products and services such as Rent Guarantee insurance to keep the cash coming in, ensuring that the rent is paid, irrespective of any changes to their tenants circumstances.

Residential property values increasingly disparate between North and South in UK

Residential Property Disparity Between The North and South

UK property values posted a monthly price rise for the first time in 20 months in March on the back of increased demand, activity and a scarcity of residential properties for sale.

However, UK Property Prices overall were up in the South and down in the North

According to fresh data released by Hometrack, UK residential property prices are still rising in the South, but property values have seen widespread falls throughout the East Midlands, Wales and the North.

During March 2012, residential property values did dip a little in a few parts of London, the South-West and East Anglia. However, in Yorkshire and Humber, about half the region saw property prices fall. Property values were also down in the East Midlands, North West and Wales,

With such widespread variations, the Hometrack survey shows that nationally residential property prices as a whole are barely moving, up just 0.2% from February 2012.

There was only a 4.4% increase in new buyers registering with agents, compared to 18% in February.

The length of time taken to sell a residential property also varies widely across the country, from 11.6 weeks in the Midlands and North to under six weeks in London.

Hometrack’s Director of Research, Richard Donnell, said: “The housing market is not firing on all cylinders nationally. The divergence in the relative strength in northern and southern England is set to remain. We expect prices to track sideways in the short term, with the outlook for the second half of the year hinging on households’ expectations for the economy and their incomes.”

The Hometrack report does not give residential property prices, but said that in London property prices rose 0.5% in March, the highest monthly increase since April 2010.

However, the increase in London property prices were recorded pre-Budget, when Stamp Duty on properties valued at £2 Million (GBP) plus increased from 5% to 7%, for private purchasers, and 15%for properties bought by partnerships, collective investment funds and companies.

The survey results reveal a clear divide in the strength of the UK property market between southern England and the rest of the country.

Hometrack reckon that all the evidence points to a continued firming up in UK property prices over the next few months as demand for residential property increases and the supply of available properties remains subdued.

Figures published last week show that the premium paid by buyers of new UK residential properties has widened dramatically following a 6.1% rise in prices of new-build properties over the last 12 months.

The website Smartnewhomes reported that the average price of a new build residential property was £228,909 in January 2012.

The UK Land Registry reported that the average residential property price in England and Wales for the same month was £161,545 – an annual drop of 1%.

The Land Registry’s survey is based on all residential property transactions, including new build homes, but excluding property repossessions and property sold at auctions.

It means that the premium paid by UK residential property buyers for new build properties is more than £67,364.

More than 66% UK property owners believe the value of their home will stay the same in 2012.

New research from Clydesdale and Yorkshire Banks has found that the majority of the UK public believe the value of their home will stay the same over the next 12 months.

The study revealed 66% of homeowners do not expect UK residential property prices to change considerably in either direction.

Only 16% of respondents anticipate that the value of their property will fall again this year, with the remainder expecting the costs to rise.

Retail Director for Clydesdale Bank, Steve Reid stated: “It is encouraging that such a high percentage of people have confidence in the property market and the value of their home.”

The research also revealed property owners in London are the most positive about the prospects of their property prices this year, with 39% believing the value of property is likely to escalate.

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New property instructions coming to market have seen vendors raise the average asking price by 4.1%

The average property asking price for new instructions put on the market within the last 4 weeks is now £233,252.

The almost £11,000 increase is up from January’s average asking price of £224,060, despite a warning that much of the residential property stock already on the market in some parts of the UK, is “over-priced and unsaleable”.

Rightmove have described the highest monthly increase since April 2002, the biggest rise in UK property asking prices for nearly ten years as “a surprisingly strong uplift given the challenging economic environment”.

But it said that the rise is partly fuelled by cash-rich sectors of the market, where buyer demand is exceeding suitable property supply.

Director Miles Shipside warned property vendors: “There is pricing power if you are selling the right type of property in the right place, where enough potential buyers have access to funding. But if your local market does not have those characteristics and your price-pump is based on little more than seasonal optimism and an estate agent’s hot air, then be prepared for buyer response to be a let-down.”

He added: “In some micro-markets, sellers have the upper hand, but on the whole, a buyer with cash or a mortgage offer is the one in the driving seat.”

After depressed activity in the UK property market over the last four years, some households have decided they had to get on and move. This means that here could be a growing acceptance by the British public that the state of today’s housing market is the new norm.

Mr Shipside said: “Search activity on Rightmove is up by 19% on January 2011 and it could be a sign that some of those who can afford to move have decided to get on with their lives, driven either by desperation or by coming to terms with the constant barrage of negative economic news being the new norm. You can get tired of gloomy news or get used to it, and indeed for some cash-rich buyers, life has moved on to such an extent that it’s like the Lehman Brothers collapse never happened. Stock levels are still on the high side in some less active parts of the country, but much of that stock is perhaps over-priced and unsaleable. However, in some micro-markets, the shortage of existing and new instructions has helped contribute to the largest monthly jump in new selling asking prices for nearly a decade. While the mass-market stays at home, those that have access to funding continue to be active and have spending power, resulting in this month’s big price hike.”

Average weekly listings on Rightmove are currently 30% below 2007 (pre-credit crunch levels), with a weekly run rate of 24,406 new listings.

Rightmove’s current asking price of £233,252 appears to be £70,000 ahead of current actual property selling prices, when compared with the selling prices currently being reported by Halifax and Nationwide of £160,907 and £162,228 respectively.

With the continuation of the record low Bank of England interest rates (0.5%) there has been very little movement in UK property prices for more than 8 months.

However, UK mortgage lender Halifax reckons there was a 0.6% increase in UK property values in January 2012.
The UK’s largest mortgage lender found that despite the month-on-month increase in January, on average UK property prices were still 0.9% lower over a rolling three-month period.

The average price of a UK residential property in January 2012 was £160,907.

This has resulted in a 14-year low, in terms of payments in proportion to household earnings, for new borrowers looking to invest in UK residential properties.

Martin Ellis, housing economist at Halifax, said: “If the UK can avoid a prolonged recession, we expect broad stability in house prices in 2012.”

The prospects for UK property prices in 2012 will depend on many facors, including the fallout and repercussions from the Eurozone debacle and its effect on the struggling UK economy.

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