August 5, 2010
Buy To Let Landlord Back In The Game
He may be splashing out £60 million to help develop a chic west London hotel with a butterfly house in the reception, but Andreas Panayiotou still has an eye on the buy-to-let market that was the foundation of his fortune.
In a rare interview, Panayiotou, who was one of the few to call the top and bottom of the market, said: ‘Residential property is very safe. It will be good long term. There’s a shortage of housing, and developers have stopped building.’
His predictions carry weight. Panayiotou, 44, born in the East End of London to Cypriot parents, warned in 2006 that a crash was imminent and began cashing in his £1 billion property investment portfolio. Property prices tumbled more than 20 per cent between 2007 and 2009.
When economists made apocalyptic predictions in the spring of 2009, he revealed he was buying back in as he could earn more in rent than from the bank. A powerful recovery followed, which saw prices rise ten per cent in the year to April.
Spread the word
Spread the word
August 4, 2010
House Prices Up NOT Down
Doom-mongers who are predicting a 'double dip' in house prices have got it wrong, experts said today.
The Centre For Economics And Business Research (CEBR) said prices will increase 4 per cent this year and continue rising until 2014, mainly due to a shortage of homes in the UK and low interest rates.
And the National Institute of Economic and Social Research forecast that the market would fall 8 per cent in real terms over the next five years.
The CEBR said: 'It is unfortunate, but hardly surprising, that many commentators are purporting that the minor correction in house prices over recent months is a prelude to an even steeper decline that will engulf the housing market over the coming years.
'Those forecasters projecting a double dip have got it wrong.'
The CEBR expects moderate rises from now until the end of 2011, but believes that prices will increase by 5 per cent in 2012, 5.4per cent in 2013 and 3.9per cent in 2014.
Spread the word
July 26, 2010
Property Investment In Manchester Booms
The number of tenants looking for rental property in Manchester City Centre property investment with a local letting agent reached an all time high this month, providing further evidence that the Manchester property market is returning to full swing.
The number of tenants registered with Thornley Groves Estate Agents has increased 117 percent since the start of the year, propelling demand for rented property in the city centre to an all time high.
A statement from the company said: “The number of people looking for rented accommodation in the city centre traditionally increases in July, driven in large part by the influx of university students into the area ahead of the new academic year.
“Significantly however, numbers are up more than 50 percent on July 2009, having reached their highest peak in recorded history. We really are seeing more people than ever before looking for Manchester lettings.
“This increase will come as welcome news for the Manchester property industry, and represents a superb opportunity for investors looking to enter the buy to let market.
“There remains a shortage of new investment in buy to let stock following the period of illiquidity brought about by the on-set of the world recession in late 2008.
“With such high current interest in the Manchester property market amongst tenants, we believe that the current window offers the perfect opportunity for new investors to enjoy a high return.
Spread the word
July 24, 2010
Buy To Let Property Shortage
The dearth in available rental investment properties is worsening, according to research produced recently by the Association of Residential Lettings Agents (ARLA).
Almost three quarters (70 percent) of ARLA member offices say that there are more tenants than available investment properties. This is an increase from 59 percent last quarter and 24 percent in September 2009.
The situation is particularly pertinent in the South East, where 76 percent of member offices report more tenants than properties.
Ian Potter, operations manager of ARLA, said: “The spring period would usually see a rise in rental properties coming onto the market, and although there is some evidence of landlords considering selling up, it is not enough to counteract the change in supply.
Spread the word
Nearly three times as many property investment landlords reported that tenant demand was rising rather than falling during the second quarter of the year, Paragon Mortgages’ PRS Trends Report has revealed.
The quarterly snapshot of the private rented sector and buy to let market shows that 29 percent of landlords with buy to let investment property recorded growing levels of tenant demand during the period, compared to 10 percent who said it was falling.
Both of these measurables increased compared to the first quarter of the year, when 24 percent of landlords reported growing tenant demand and 8 percent reported falling levels of demand.
Tenant demand was stable for the majority of landlords during the second quarter (54 percent), whilst 7 percent said they were unsure which direction demand was heading.
Looking forward, landlords expect tenant demand to strengthen considerably. Over a third of landlords (35 percent) expect demand to be higher in 12 months’ time, with 8 percent forecasting a decline.
Spread the word
The buy to let industry is surging back to health after the recession according to financial and property specialists thanks to favourable mortgage deals and rising demand.
Three years ago there were 3,650 mortgages for landlords. This fell to under 180 late last year. But mortgage lenders are reintroducing cheaper buy to let products.
Now there are 300, according to financial website Moneyfacts.co.uk, and some are offering 80 percent loan-to-value.
Melanie Bien, a director at mortgage broker Private Finance, said in an interview with The Telegraph: “With property prices rising, more lenders are likely to follow suit and edge up their maximum loan-to-values.
“It is just a question of when this will happen. While there is little choice of remortgage deals [for existing landlords] this isn’t such an issue when interest rates are low.”
Statistics from Findaproperty.com also suggests the buy to let market is stronger than ever.
Researchers at the website have found yields are on average 4.54 per cent across the UK and just over seven percent in parts of London. In 2008 they dipped to two per cent or less in many places.
Spread the word
A new Rent Guarantee insurance product for landlords has hit the market from Martin & Co and lettings insurance specialist HomeLet.
Called the Martin & Co Promise, the scheme provides cover for missed rental payments, with 100 percent of the monthly rent paid for up to five months from the first arrears.
It also covers legal expenses for eviction costs and covers the whole property, no matter how many tenants a property investment landlord has.
Landlords will also receive 75 percent for two months after the property has been vacated and while they are looking for new tenants.
Ian Wilson, managing director of Martin & Co, said: “We’ve worked closely with HomeLet for over five years and they’ve used our experience of residential lettings to develop this new product and ensure that its features and benefits are tailored to our landlords' needs.
“Sadly, in the majority of cases it’s a change in the tenant's circumstances that makes them unable to pay the rent.
“This can put the landlord in a difficult situation, especially if their rent isn’t guaranteed. Naturally landlords may be sympathetic, but they still need their rent.”
Spread the word
Average rents have risen a reassuring four percent in the last quarter, according to FindaProperty.com’s latest report.
And with the Bank of England warning of a coming mortgage famine, landlords could be see the number of first time buyers priced out of the market and heading for rented accommodation rise even further.
Rental prices asked for by landlords on findaproperty.com had fallen more than six percent between early 2008 and the beginning of this year.
But with a jump from £804 in January to a current rental of £839, experts predict the rental market is due another surge.
Nigel Lewis, property analyst at FindaProperty.com, said: “Rents have gone from strength to strength during the first half of 2010.
“The resurgence of the sales market has left tenants short of options and the result has been increasing rental prices.
“We're beginning to creep towards the equilibrium between stock levels and prices at which the market is perfectly balanced and neither party - tenant or landlord - can claim negotiating rights.”
