Buy to Let to Dominate Market
Buy to Let to Dominate Market - This week has seen interest rates move up gain and the government is hoping that this will take the sting slightly out of the housing market. There are many that blame buy to let purchasers as one of the reasons that house prices are increasing so dramatically. Of course this has assisted in rising prices but buy to let only exists because there is a demand for rental properties. Changes in lifestyle and the way we live have meant that there is more of a demand for rental properties. Landlords buy property because they know, with the right purchase, they will be able to easily obtain a rental income. Buying property or commercial buildings for rental purposes, will not simply disappear, it may slow down for a time but for the long term investor, property represents a good bet and now that mortgage lenders are more than happy to lend money on rental properties, buy to let is here to stay.
Statistics from ARLA, the association of residential letting agents suggest that buy to let investors borrow an average of 73% of the purchase price for any property that they wish to buy. This money is readily available from any number of building societies and banks. Now 1 in 8 borrow less than half. 40% of investors buy properties that are over 50 years old and less than a fifth buy property that is new. These figures seem to indicate that landlords have an eye for a bargain and like snapping up older style buildings and renovating them prior to letting. The average buy to let investor anticipates keeping a property for 17 years.Another indication of the report is that investors see themselves as long term holders of property, speculators are not particularly evident in this market and because of the length of time that landlords anticipate holding property, this could be one of the reasons why there is a shortages of housing stock at the present moment.
All landlords hope to secure good tenants and an average tenant will stay in a property for 18 months. A third of all renters are between 23 and 30 and this seems to fit in with the latest trends of homeownership. For many renting a home long term is ahs no stigma attached to it. There is a good supply of quality rental property on the market and because of the number of buy to lets on the market, rents are quite competitive. In the city areas, a number of landlords have opted for modern apartments in renovating buildings as good deals are always available on these. Many people are now happy with the possibility of having to rent a home long term home particularly single persons and thus the demand for buy to let is set to continue. Assetsure are able to offer insurance for buy to let properties either residential or commercial
Government to assist with flooding - The government is set to announce a new initiative which will provide a £500,000 funding package to homes that are vulnerable to flooding to make them more secure. Although this is a very welcome move, if real improvements are to be made, then this amount of money will need to increase. Because of the effects of climate change, flooding is set to increase in the United kingdom over the next 40 years and it will not be possible for insurers to cover all of the costs, it is feared that many homes will be become uninsurable. This inability to source insurance then provides serious problems for the homeowner as without insurance, it is impossible to raise a mortgage on the property. It is anticipated that the government needs to increase it's spending on flood defences to £750.00 million pounds per annum to ensure that the maximum amount of property as possible is protected. There may come a time in the United Kingdom where the government has to set up it's own insurance scheme to provide insurance protection form homes that are unable to obtain cover on the open insurance market.
Holiday Home News - the property market in Malta is really heating up thanks to increased demand from holiday home owners. Malta is set to become more accessible with a number of budget airlines planning cheap flights to the island. Holiday home ownership in France & Spain has really be opened up by the arrival of budget airlines and it is predicted that Malta with it's unique British feel and wonderful climate is next to follow suit. Malta is l within easy flying distance of the United Kingdom and so much property has now been snapped up that the Maltese government is considering proposals to release more land for building purposes. A little further a field, how does the thought of owing a holiday home in eastern Europe, Russia or even China sound. Well perhaps not but when a section of wealthy clients of up market estate agent Knight Frank were asked where they were p-planning to invest their money, all of the above received a mention. At the present moment, Bulgaria is the only real eastern block country that has any real holiday home ownership.
Many people are buying in other countries for investment purposes and to let to the locate population. It seems that shrewd investors are targeting areas of the world where they anticipate growth in the next couple of years not to purchase holiday homes but to acquire cheap property for rental to the local population. Spain the perennial favourite of the Brits has seen a number of hiccups in recent weeks but it seems to all be a storm in a teacup. Property prices are quite stable and there is no shortage of Brits looking to obtain a holiday home or retirement home in the country. The latest trend however, is to rent for a period of time then be on hand to snap up any property bargains as and when they arrive. Alicante is one area that is experiencing a price surge at the moment, prices have risen by as much a 9% in the last 4 months, this seems to put paid to any thoughts of a price crash, Although many of the Eastern bloc countries are trying to catch up with Spain for holiday home ownership, it is going to be quite some time, if ever if Spain loosing it's crown as the number one country for holiday home ownership. Assetsure are able to offer insurance on all types of holiday home, we can cover insurance for home buildings and contents or either on it's own. if you decide to rent out your holiday home, we can provide insurance cover for this as well.