There is nothing new about recessions – they have been with us since time immemorial. They form part of what is termed the ‘economic cycle’ – periods of growth and decline which have happened throughout history. These have an effect on all markets and industries including property.
A successful property investing strategy involves buying at the bottom of the cycle, and therefore maximising the financial return. But how does an investor identify this critical moment which determines success or failure for the property investor?
Most economists agree that the economic cycle consists of five distinct stages, each of which flows into the next. These are defined as the peak, contraction, recession, recovery and prosperity. At the peak of a boom property is considered to be overvalued. Credit providers are heavily burdened with debt. As the contraction stage starts, sources of credit dry up, and property sales grind inevitably to a halt.
The price of property and shares is at a low ebb and credit is difficult, if not impossible, to obtain. Recovery commences when credit facilities again become available. At this point institutional investors become involved in the market, moving rapidly to purchase undervalued property and shares. The next stage is prosperity. Prices rise once more, the workforce’s salaries rise and credit providers become more amenable to risk.
So when was the last time we experienced this economic cycle? The last significant correction in the UK housing market occurred in 1991. At that time, banks and other lenders frequently offered 100% mortgages – yes, I know it’s hard to believe but it really did happen. This more-than-generous financing fed the strong desire to own property which inevitably led to the peak of the housing ‘bubble’.
But as the economy slowed a total of 75,540 repossessions followed, partly due to the burden of sub-prime debt – does that sound familiar? This represented the highest recorded in any one year (so far) and spelt obvious heartbreak and misery to those concerned. The market did not seriously begin to recover until 1994. At that time the UK economy was registering 4.2% GDP growth, the highest level for six years. The sustained economic growth, combined with rising incomes, meant people could afford larger mortgages. Consequently, demand for housing rose.
Most people view property as essentially a stable asset, despite the peaks and troughs that occur at the various stages of the economic cycle. Unlike investment in shares, a property owner has a tangible asset of bricks and mortar. A constantly expanding population will always need somewhere to live, and therefore there will always be demand.
Knowledge of economic cycles and the property market means one can begin to predict the upswing in a market. The current financial crisis has strong parallels with that of the 1991 crash. The beginning can be traced to early 2007, when the total value of sub prime mortgages was estimated at US$1.3 trillion. Rising property values resulted in lenders taking more risks. The number of credit providers began to collapse under the weight of defaulted loans, with the most notable example being the once mighty Lehman Brothers. The scale of the problem was becoming horribly clear. As the flow of credit between banks dried up, the knock on effect included reduced lending to consumers and thus a slowdown in the housing market. Once interest rates are low enough, credit flow becomes liquid once again. At this point institutional investors enter the market, confidence returns and the upswing begins.
Usually upswings begin in the same place the downturn began. The US housing market is therefore key – as soon as it begins to pick up then it can be seen as a sign for the rest of the world. Standard & Poor, the ratings and analytical company who produce the US Case-Schiller housing index, believes the market will reach the very bottom by October 2009. It also states that investors should start to consider purchasing property as credit becomes more available.
Global property investors should also consider countries and regions which have not suffered so savagely in the current economic downturn. Central and Eastern Europe saw a slowing of their economies and Bulgaria in particular has been unaffected by toxic debts.
But there inevitably remains a strong element of doubt. Who can tell whether the London property market has hit its lowest point? Unemployment looks certain to increase, with a consequent rise in repossessions.
Investment in property carries an element of risk. An assessment of the economic cycle may reduce this, but it cannot be expected to eliminate it.
Sunday, 27 December 2009
Tuesday, 22 December 2009
Property Investment
Investing in property is not just finding a place that a person could call home. Over the years, investing in property and real estate has become more of an investment vehicle, with the real estate market providing a lot of opportunities to the investors wanting to make big capital gains. In recent times, many investors are showing their interest in the UK property market, with the UK economy past the worst of recession and genuine growth near at hand. In recent months, there has been an increase in sales in the Central London property market; the prices of prime properties in London have also increased. As of now, property investment London is making a lot of sense.
Having taken the decision to invest in the London property market, potential investors would need to be clear about some other details as well. They would need to decide on the specific sectors in which they would want to invest their money. They could buy properties in the individual house market or go for new property developments London. Over the last couple of years, these two sectors have performed strongly; capital has appreciated the right way and the property owners are also able to find tenants quite easily.
The next step in property investment London is to identify central London estate agents of repute. These experts and professionals can offer advice on prime locations for investing, introduce the investors to the developers, facilitate loans from banks and finance houses, and even help owners maintain their properties to maximise the capital and letting value of the same. The investors, wanting the services of property tax accountants and solicitors, can also depend on their estate agents to address this need.
There are some well-established real estate agents that can help you with property investment London. Some of these come with full fledged web sites and so accessing their services is that much easier and hassle free. These real estate agents would acquaint you with the best Central London properties and assist you in every possible way. One could say that they have a broader perspective on the London property market and you can make the most of their experience and expertise to invest in the best properties in the area. So, whether you are in need of family houses in Central London that you can sublet or are interested in new developments in the area, the right kind of real estate agents would help you find just the place you are looking for.
Having taken the decision to invest in the London property market, potential investors would need to be clear about some other details as well. They would need to decide on the specific sectors in which they would want to invest their money. They could buy properties in the individual house market or go for new property developments London. Over the last couple of years, these two sectors have performed strongly; capital has appreciated the right way and the property owners are also able to find tenants quite easily.
The next step in property investment London is to identify central London estate agents of repute. These experts and professionals can offer advice on prime locations for investing, introduce the investors to the developers, facilitate loans from banks and finance houses, and even help owners maintain their properties to maximise the capital and letting value of the same. The investors, wanting the services of property tax accountants and solicitors, can also depend on their estate agents to address this need.
There are some well-established real estate agents that can help you with property investment London. Some of these come with full fledged web sites and so accessing their services is that much easier and hassle free. These real estate agents would acquaint you with the best Central London properties and assist you in every possible way. One could say that they have a broader perspective on the London property market and you can make the most of their experience and expertise to invest in the best properties in the area. So, whether you are in need of family houses in Central London that you can sublet or are interested in new developments in the area, the right kind of real estate agents would help you find just the place you are looking for.
Wednesday, 7 October 2009
UK Pubs For Sale: Property Investment And Change of Use
UK Pub Conversions- Change of Use
6 pubs a week are calling last orders for the last time with the asking price of the buildings low enough to tempt property developers as well as other retailers. Planning laws on change of use may restrict development to residential property on pubs in certain areas; a city centre pub is more likely to gain permission for conversion to a residential property than the only pub in the village, and some pubs are advertised for sale with full change of use/ planning.
Agents at London-based Paramount Investments said the company would prefer to sell to a new pub landlord but would consider other buyers. Paramount managing director Mark Greig said: “Not all pubs which close down are redeveloped as housing. A lot of them reopen again as pubs or as other businesses.” He added: “Falling property prices are creating tremendous bargains within the pub market for licensees and other entrepreneurs”
So if residential conversion is not available, what changes can be made to the use of the pub for other businesses?
The following classes of use for England are set out in the Town and Country Planning Order 1987. Pubs are in the A4 ‘Drinking Establishment’ class, and can be converted without permission being sought to any of the following;
A1, Shops, retail warehouses, hairdressers, undertakers, travel and ticket agencies, post offices, pet shops, sandwich bars, showrooms, domestic hire shops, dry cleaners and funeral directors
A2 Financial and professional services - Banks, building societies, estate and employment agencies, professional and financial services and betting offices.
A3 Restaurants and cafés - For the sale of food and drink for consumption on the premises - restaurants, snack bars and cafes
Paramount managing director Mark Greig said “Pubs often appeal to retailers because there is a natural crossover in space requirements. As pubs are often around 4,000 sq ft (370 sq m) and have a floor-to-ceiling height of around 8 ft (2.4 m), the sales space is ideal. Furthermore, because pubs also need both basement space for heavy duty equipment and space for deliveries, retailers often find they have ready-made sites for storage.”
UK Pub Sales Agents: Paramount Investments are specialists in the sales and leasing of UK pubs, including freehold pubs, leasehold pubs, inns, public houses, pub tenancies and managed houses.
For further details please contact the investments team on 020 7644 2333
Web: Paramount Investments
Blog: UK Pubs for Sale
Search: UK Pub Sales
6 pubs a week are calling last orders for the last time with the asking price of the buildings low enough to tempt property developers as well as other retailers. Planning laws on change of use may restrict development to residential property on pubs in certain areas; a city centre pub is more likely to gain permission for conversion to a residential property than the only pub in the village, and some pubs are advertised for sale with full change of use/ planning.
Agents at London-based Paramount Investments said the company would prefer to sell to a new pub landlord but would consider other buyers. Paramount managing director Mark Greig said: “Not all pubs which close down are redeveloped as housing. A lot of them reopen again as pubs or as other businesses.” He added: “Falling property prices are creating tremendous bargains within the pub market for licensees and other entrepreneurs”
So if residential conversion is not available, what changes can be made to the use of the pub for other businesses?
The following classes of use for England are set out in the Town and Country Planning Order 1987. Pubs are in the A4 ‘Drinking Establishment’ class, and can be converted without permission being sought to any of the following;
A1, Shops, retail warehouses, hairdressers, undertakers, travel and ticket agencies, post offices, pet shops, sandwich bars, showrooms, domestic hire shops, dry cleaners and funeral directors
A2 Financial and professional services - Banks, building societies, estate and employment agencies, professional and financial services and betting offices.
A3 Restaurants and cafés - For the sale of food and drink for consumption on the premises - restaurants, snack bars and cafes
Paramount managing director Mark Greig said “Pubs often appeal to retailers because there is a natural crossover in space requirements. As pubs are often around 4,000 sq ft (370 sq m) and have a floor-to-ceiling height of around 8 ft (2.4 m), the sales space is ideal. Furthermore, because pubs also need both basement space for heavy duty equipment and space for deliveries, retailers often find they have ready-made sites for storage.”
UK Pub Sales Agents: Paramount Investments are specialists in the sales and leasing of UK pubs, including freehold pubs, leasehold pubs, inns, public houses, pub tenancies and managed houses.
For further details please contact the investments team on 020 7644 2333
Web: Paramount Investments
Blog: UK Pubs for Sale
Search: UK Pub Sales
Monday, 5 October 2009
London Property Investment; London Rental Property Market Remains Bouyant
The weak pound, the tumbling property prices, the lowest ever interest rate has turned the UK into the newest European emerging property market. It has been predicted that property prices could fall a further 15% to 30 % in the first half of 2009 and that the pound will fall even further. The experts talk of a 2010 turnaround for the property market, making 2009 the year for Europeans to make that investment in the UK. Once the market begins to swing in the other direction, anyone who has invested in it will be seeing some fantastic returns on their initial investments.
London is the obvious destination for investment, and any investigation onto the property market will tell you that London is definitely a buyers market at the moment; London comes in at number 3 on the International Law Partnerships list of 2009 property investment destination (behind Paris and Miami)
The current market means that there are many people who will be looking for rental accommodation in the coming year; London’s international student community continues to thrive as many students are drawn to the capital, one of the most exciting and culturally diverse cities in the world. Almost 83,000 Higher Education students studying in London are from outside the UK, representing 1 in 5 of all students studying in London. The annual influx of tourist and businessmen looking for short lets comtinues. Any property purchase in London should let well until the capital gain is made.
Central London and the West End as the obvious choice for the overseas investor. It is here that you will find well known landmarks such as Nelson's column, tourist attractions such as Madame Tussaud's and the National Gallery and the shoppers' paradise of Oxford Street and Regents Street. Here too are the London School of Economics, RADA, UCL and many other institutions of learning.
For residential 'West End' see Fitzrovia, Marylebone, Soho, Covent Garden, Mayfair, and Bloomsbury. The purchase of a property in one of these areas, even as a short term investment for the duration of a degree course, could see the bills for tuition fees, student accommodation and living expenses for their child seem very affordable. Factor in the extra rent potential of sub letting and the comfort of knowing your main tenant is going to look after your investment and central London property purchase in 2009/10 is all the more appealing.
Ldg West End Estate Agents have a range of houses, penthouses, lofts, studios, flats and apartments for sale and to rent in the West End, Fitzrovia, Soho, Covent Garden, Bloomsbury and Marylebone areas. If you just need some sound property advice we would be delighted to help without obligation. From studio flats to period houses - cutting edge design to unmodernised lofts ours is a broad church but whatever your requirments our aim is to make your buying, selling, renting, or letting experience as pleasurable and hassle free as possible.
London is the obvious destination for investment, and any investigation onto the property market will tell you that London is definitely a buyers market at the moment; London comes in at number 3 on the International Law Partnerships list of 2009 property investment destination (behind Paris and Miami)
The current market means that there are many people who will be looking for rental accommodation in the coming year; London’s international student community continues to thrive as many students are drawn to the capital, one of the most exciting and culturally diverse cities in the world. Almost 83,000 Higher Education students studying in London are from outside the UK, representing 1 in 5 of all students studying in London. The annual influx of tourist and businessmen looking for short lets comtinues. Any property purchase in London should let well until the capital gain is made.
Central London and the West End as the obvious choice for the overseas investor. It is here that you will find well known landmarks such as Nelson's column, tourist attractions such as Madame Tussaud's and the National Gallery and the shoppers' paradise of Oxford Street and Regents Street. Here too are the London School of Economics, RADA, UCL and many other institutions of learning.
For residential 'West End' see Fitzrovia, Marylebone, Soho, Covent Garden, Mayfair, and Bloomsbury. The purchase of a property in one of these areas, even as a short term investment for the duration of a degree course, could see the bills for tuition fees, student accommodation and living expenses for their child seem very affordable. Factor in the extra rent potential of sub letting and the comfort of knowing your main tenant is going to look after your investment and central London property purchase in 2009/10 is all the more appealing.
Ldg West End Estate Agents have a range of houses, penthouses, lofts, studios, flats and apartments for sale and to rent in the West End, Fitzrovia, Soho, Covent Garden, Bloomsbury and Marylebone areas. If you just need some sound property advice we would be delighted to help without obligation. From studio flats to period houses - cutting edge design to unmodernised lofts ours is a broad church but whatever your requirments our aim is to make your buying, selling, renting, or letting experience as pleasurable and hassle free as possible.
Saturday, 13 June 2009
Overseas Property Investment
Top Tips For Overseas Property Investment;Its All Been Said Before But Its Worth Reiterating
Thursday, 11 June 2009
Estate Agents Websites
There was a time when a homebuyers first search would be in the local paper property pages, followed by a trip into the Estate Agent to pick up the details, before ringing up to organise a viewing. Nowadays the internet means that most property searches begin online. We can view the street, garden and rooms and create a favourites list while watching the TV.
Typically purchasers will search for Property/house/flats/one bedroom apartments/Villas etc in West Hampstead/ Dubai/Solihull. They will not be searching the name of the agent necessarily. Websites built, nurtured and maintained with Search Engine Optimisation in mind will ensure the Estate Agent is stumbled upon; the agency site which appears on the first pages of Google under usual search terms, will be the first port of call.
Once found websites should be easily accessible; the next agent’s website is just one click away if the prospective client is asked to fill out a long form and register in order to view your properties. We don’t want to spend 10 minute looking for the ‘search properties’ or ‘contact us’ functionality
Estate Agency websites not only need to provide an easy to use property search facility for the prospective buyer looking to create a viewing shortlist. They must ensure that each set of property details are as comprehensive and informative as possible, to include maps, and knowledge of the local area, floor plans and as many photos as possible. As yet, video footage of UK residential property is not often used and may prove to be too costly in the marketing process. However, videos and/or 360 degree images of overseas property is a must in a market where the cost of viewing several properties before purchase could put prove prohibitive.
Likewise, when looking around for an agent as a seller we want to see our home marketed to its full potential, whatever its asking price, so that we wonder why we are moving on; great photos and descriptions, local information such as lists of schools, transport links should be the norm.
Paramount Properties are West Hampstead based estate and letting agents with houses, penthouses, lofts, studios, flats and apartments for sale and to rent in Belsize Park, Brondesbury, Childs Hill, Cricklewood, Fortune Green, Highgate,Hampstead, Hampstead Village, Hocroft Estate, Little Venice, Kensal Rise, Klburn, Maida Vale, Mapesbury Estate, Queens Park, St. John's Wood, South Hampstead, Swiss Cottage and Willesden Green
Paramount Properties Estate and Letting Agents
150 WEST END LANE
WEST HAMPSTEAD, LONDON, NW6 1SD
Tel: 020 7644 2336 Fax: 020 7372 2712
e-mail: info@paramount-properties.co.uk
West Hampstead estate agents
West Hampstead estate agents.blog
Typically purchasers will search for Property/house/flats/one bedroom apartments/Villas etc in West Hampstead/ Dubai/Solihull. They will not be searching the name of the agent necessarily. Websites built, nurtured and maintained with Search Engine Optimisation in mind will ensure the Estate Agent is stumbled upon; the agency site which appears on the first pages of Google under usual search terms, will be the first port of call.
Once found websites should be easily accessible; the next agent’s website is just one click away if the prospective client is asked to fill out a long form and register in order to view your properties. We don’t want to spend 10 minute looking for the ‘search properties’ or ‘contact us’ functionality
Estate Agency websites not only need to provide an easy to use property search facility for the prospective buyer looking to create a viewing shortlist. They must ensure that each set of property details are as comprehensive and informative as possible, to include maps, and knowledge of the local area, floor plans and as many photos as possible. As yet, video footage of UK residential property is not often used and may prove to be too costly in the marketing process. However, videos and/or 360 degree images of overseas property is a must in a market where the cost of viewing several properties before purchase could put prove prohibitive.
Likewise, when looking around for an agent as a seller we want to see our home marketed to its full potential, whatever its asking price, so that we wonder why we are moving on; great photos and descriptions, local information such as lists of schools, transport links should be the norm.
Paramount Properties are West Hampstead based estate and letting agents with houses, penthouses, lofts, studios, flats and apartments for sale and to rent in Belsize Park, Brondesbury, Childs Hill, Cricklewood, Fortune Green, Highgate,Hampstead, Hampstead Village, Hocroft Estate, Little Venice, Kensal Rise, Klburn, Maida Vale, Mapesbury Estate, Queens Park, St. John's Wood, South Hampstead, Swiss Cottage and Willesden Green
Paramount Properties Estate and Letting Agents
150 WEST END LANE
WEST HAMPSTEAD, LONDON, NW6 1SD
Tel: 020 7644 2336 Fax: 020 7372 2712
e-mail: info@paramount-properties.co.uk
West Hampstead estate agents
West Hampstead estate agents.blog
Wednesday, 10 June 2009
Gazumping and Gazundering
Gazundering and Gazumping Rates Reveal Property Market Revival
Gazumping has returned to the property market as confidence among estate agents reaches its highest level since the credit crunch began. Gazumping last hit its peak with buoyant property prices in the residential property market of the late 1980s and early 1990s when gazumping became commonplace (in England and Wales)Gazumping is possible here because a buyer's offer is not legally binding even after acceptance of the offer by the vendor. This is because, by s.2 of the Law of Property (Miscellaneous Provisions) Act 1989 and in order to prevent dishonesty, a contract for the sale of land must be in writing (a requirement of English law that dates back to the Statute of Frauds of 1677)
What Is Gazumping?
When the owner accepts the offer on a property, the buyer will usually not yet have commissioned a building survey nor will the buyer have yet had the opportunity to perform recommended legal checks. The offer to purchase is made "subject to contract" and thus, until written contracts are exchanged either party can pull out at any time. It can take as long as 10-12 weeks for formalities to be completed, and if the seller is tempted by a higher offer during this period it leaves the buyer disappointed and out-of-pocket.
Gazumping is hitting popular parts of London for the first time in months and it is now likely to strike other towns and cities where prospective buyers outnumber properties.
So is it farewell to Gazundering?
We hope so.When property prices are in decline the practice of gazumping becomes rare. The term gazundering has been coined for the opposite practice whereby the buyer waits until everybody is poised to exchange contracts before lowering the offer on the property, threatening the collapse of a whole chain of house sales waiting for the deal to go through.
Gazumping has returned to the property market as confidence among estate agents reaches its highest level since the credit crunch began. Gazumping last hit its peak with buoyant property prices in the residential property market of the late 1980s and early 1990s when gazumping became commonplace (in England and Wales)Gazumping is possible here because a buyer's offer is not legally binding even after acceptance of the offer by the vendor. This is because, by s.2 of the Law of Property (Miscellaneous Provisions) Act 1989 and in order to prevent dishonesty, a contract for the sale of land must be in writing (a requirement of English law that dates back to the Statute of Frauds of 1677)
What Is Gazumping?
When the owner accepts the offer on a property, the buyer will usually not yet have commissioned a building survey nor will the buyer have yet had the opportunity to perform recommended legal checks. The offer to purchase is made "subject to contract" and thus, until written contracts are exchanged either party can pull out at any time. It can take as long as 10-12 weeks for formalities to be completed, and if the seller is tempted by a higher offer during this period it leaves the buyer disappointed and out-of-pocket.
Gazumping is hitting popular parts of London for the first time in months and it is now likely to strike other towns and cities where prospective buyers outnumber properties.
So is it farewell to Gazundering?
We hope so.When property prices are in decline the practice of gazumping becomes rare. The term gazundering has been coined for the opposite practice whereby the buyer waits until everybody is poised to exchange contracts before lowering the offer on the property, threatening the collapse of a whole chain of house sales waiting for the deal to go through.
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