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North East Investment Property 

Investment deal priced to move quickly, Don’t Delay – Call Today quoting Ref: MPPT

property solutions

Property Sourcing Specialists based in The North East

An excellent investment property which has been re-furbsihed throughout to a very high standard.  The property is located in an area which has easy access to all major routes and is within walking distance to local amenities.  The property is offered at 20% BMV and the current owner has a tenant ready to move into the property.  Here is the deal.

Purchase Price          £48,000

Market Value           £60,000

Rent                         £400pcm

Yield                        10%

For further details and photographs click here

Castledene also have a cash purchase property at £27,000 which has been fully re-furbished and would provide a yield of 16 – 20%.  The property is not located in the most popular location however based on the current LHA the minimum yield achieveable would be 16%.

If you are interested in this property or for information on any other deals that Castledene have available please do not hesitate to contact Lisa on 0191 527 4007 quoting referenceMPPT.

Castledene Property Management

Professional Property People

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Sales of homes may rise a little over the coming year but prices will struggle to follow suit, according to the RICS Housing Market Forecast published on 22nd December 2011.

Prices at a headline level will edge lower by around 3% across the UK. However, the low level of supply should continue into the coming year, stabilising prices and preventing significant declines.

Transaction levels are likely to see a slight resurgence next year and climb back to around 880,000, roughly the level of activity recorded in 2010. However, to put this in context, total sales in 2006 were almost double this amount at 1.67 million.

The weak economic picture anticipated for the next six months, along with the prospect of increased unemployment, means that demand to purchase property is unlikely to see any significant increase and will remain relatively flat. While the government’s recently announced mortgage indemnity scheme is designed to help up to 100,000 buyers on to the property ladder, this is likely to have limited impact as it is restricted purely to new-build properties.

Meanwhile, despite the prospect of growing unemployment, repossessions will see only a very marginal increase in 2012. The number of repossessions for this year is likely to be around 35,000 and, although next year’s figure may be slightly higher, the total number of properties taken into possession over the next 12 months should not exceed 40,000.

Elsewhere, the residential lettings market will continue to perform well in 2012. Demand for rental properties remained strong throughout 2011, as many first-time buyers were unable to access the sales market. This looks set to continue over the coming 12 months. However, the gap between demand and supply is shrinking, suggesting that the increase in rental values may begin to slow as the year wears on.

Simon Rubinsohn, RICS Chief Economist said: “The general economic climate is likely to be the biggest influence on the residential property market next year. Prices could edge a little lower as unemployment continues to rise. However, the lack of supply in the market is likely to prevent any significant house price declines.Transaction levels should see a slight increase, although mortgage lending is likely to remain subdued which will limit the scope for improvement. As a result of this, the lettings market will remain firm, which means that rents are likely to increase further, albeit at a slower pace than in 2011”.

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Homes built before 1919 have risen in value more than any other type of property over the past 25 years.

The report by the Halifax says pre-1919 homes are popular because there are fewer of them, and they tend to be in the best locations.

Over the past quarter of a century, the report reveals, homes falling into this category have risen in price by more than 450%.

This is equivalent to an average increase of more than £500 every month for 25 years, a price rise which has not been matched by any other type of property.

In 1986, pre-1919 homes had an average value of £33,619, making the category the cheapest of the four ‘ages’ of property.

By 2001, the average had increased to £117,990 and today it is £188,473, an increase of 461%, or £516 every month.

The other three ‘ages’ of property are 1919 to 1945, 1946 to 1960 and 1960 onwards.

Martin Ellis, housing economist at the Halifax, said it was easy to see why pre-1919 properties were now more expensive than any other. “The age of a property often determines its size, its style and location. Properties from the Victorian or Edwardian era tend to be in higher demand. This is because there are fewer of them. They are often larger, situated in desirable locations, and have a popular style”.

The cheapest properties are homes built between the end of the Second World War, which triggered a building boom, and 1960.

They cost an average of £144,988, and have risen in value by only 249% over the past 25 years.

As the study highlights the popularity of older properties, it raises concerns about the Government’s moves to encourage people to buy new-build homes.

The Prime Minister has said he wanted ‘everyone in this country’ to experience the ‘magic moment’ of getting the keys to their first flat. But the Government scheme, which allows people to buy with only a 5% deposit, is available only to those who want a newly-built home.

And it is this type of property which has plunged in value over recent years amid fears of further falls. Since the credit crunch began, the Halifax figures show, homes built after 1960 have dropped by nearly £40,000 in value.

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UK Chancellor of the Exchequer George Osborne has decided not to extend the Stamp Duty holiday for First Time Buyers, (FTB)  provoking fury from critics with accusations of undermining the Government’s attempt to kick start the UK housing market.

The Government decision comes despite massive lobbying from the mortgage and estate agency industries and various organisations, including the Council of Mortgage Lenders, Nationwide, Legal & General.

The Government, however, says the Stamp Duty break has proved to be ineffective and it will end on March 24th 2012 as planned.

The Government has stated that they intend to produce proof of how the Stamp Duty holiday has not worked and will instead concentrate on other measures announced in its new housing strategy, notably its controversial mortgage indemnity scheme on which it has now unveiled a few more details.

The Chancellor revealed that the Government will underwrite the 95% mortgage scheme, which is available only for new-build purchases, by up to £1bn.

The Autumn Statement said: “The Government will take on a contingent liability which will build up in line with purchases under the scheme, to a maximum of £1bn.”

Under the scheme, taxpayers will be responsible for 5.5% of the value of each home purchased. Builders will put 3.5% of the value of each home sold under the scheme into a funding pot, which will be called upon by lenders if the properties are repossessed at a loss.

The initiative aims to help 100,000 households purchase a new-build home with a 5% deposit.

It is unclear how many first-time buyers have succeeded in getting on to the housing ladder because of the current Stamp Duty holiday, although evidence is that they have melted away.

The Royal Institute of Chartered Surveyors (RICS) warned that ending the Stamp Duty holiday could distort the market with a mini boom and bust.

A RICS spokesman said: “By choosing to end the relief in four months rather than immediately, there is a clear risk that there will be a spike followed by a dip in the housing market as buyers rush to take advantage of the relief before March. It was hardly surprising that the Stamp Duty break had failed to help first-time buyers, given the lack of affordable mortgages and homes on the market”.

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Average house prices across the UK will drop by 5% next year, and will show little convincing growth until 2014, according to the latest Knight Frank: UK housing forecast.

Prime central London prices will climb 5% next year, before pausing in 2013 and rising by a further 4% in 2014. Cumulatively, prices will rise 24% by the end of 2016.

Geo-political issues will continue to push overseas buyers into London, especially at the top end of the market, as the capital is seen as a safe haven.

The prime central London market will remain “de-coupled” from the rest of the UK market

Meanwhile, in real terms, adjusted for CPI inflation, house prices will have fallen 29% from the peak of the market by 2015 and will not regain the levels seen 2007 levels until 2028.

Grainne Gilmore, head of UK residential research at Knight Frank, said: “After falling by 15% in 2008, it was widely forecast that the market would dip again the following year, but this failed to happen – largely because of the drop in interest rates. We believe that this correction is still to come, but that it has been pushed further and further out because of low base rates. But next year, amid a ‘perfect storm’ of a struggling economy, public sector cuts and rising unemployment, prices will fall. As interest rates start to rise, prices will struggle to maintain any notable growth until 2015.”

Liam Bailey, head of research at Knight Frank, said: “Prices in prime central London are currently at an all-time high, despite which we believe there is scope for further price gains over the next 12 months, averaging 5% across 2012. The reasons which have underpinned recent growth, a weak pound, renewed wealth creation in emerging markets, the search for safe-haven assets and flight capital – all seem set to continue at least in the short term reinforcing our positive view for next year.”

Source: Investor Today

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