Surveyor Report a Strong Month for UK Housing Market

This article by the Property Wire on October 24th, 2013 tells us the another strong month for the housing market in the UK with the volume of residential valuation going up compared to August, according to Connells Survey & Valuation.

The UK housing market experienced another strong month in September, with the volume of residential valuations 55% higher than August, according to chartered surveyors Connells Survey & Valuation.
 
The firm says in its latest report that strong growth in every sector of the market brought the total number of residential valuations conducted in September 2013 to 65% higher than the same point last year.

Particularly strong growth was recorded in the areas of buy to let and remortgages, which saw increased of 66% and 64% respectively month on month. This equates to much higher annual rates of growth, following a comparatively slow month in September 2012.

‘September has felt like a tipping point. A year since the first real effects of Funding for Lending, and five years since the collapse of Lehman Brothers, the financial world appears to be at the start of a much sunnier period. In just 12 months, the situation has shifted unrecognisably with last quarter’s economic growth likely to come in above 1%,’ said John Bagshaw, corporate services director of Connells Survey & Valuation.

‘However, many borrowers have been reliant on remortgaging to fuel a good proportion of their new found optimism. If not for record low product rates, many families could now be struggling to pay their mortgage while keeping the lights on at the same time. The real question now is how long these excellent new deals can last before the Bank of England decides to raise interest rates,’ he explained.

The report also shows that improvements in total levels of activity have also translated into more new buyers, as first time buyer activity in September grew by 52% compared to August. This leaves the number of valuations on behalf of first time buyers in September 54% higher than in the same month a year ago.

Meanwhile valuations further up the property chain, on behalf of existing home owners wishing to move, have grown almost as quickly as those for first time buyers, up 46% since August, bringing home moving activity to levels 52% ahead of September 2012.

‘Over the last year first time buyers have witnessed a reversal of fortunes. Every part of the home-buying industry is straining to keep up with a rejuvenated lending system. After five years of relative inactivity, the only danger now could be the pace of improvement,’ Bagshaw pointed out.

‘What’s certain is that more people are able to buy a home. And the next rungs on the property ladder are looking far more solid than even a few months ago,’ he added.

The data also shows that after a minor seasonal slow down in August, buy to let activity has bounced back strongly in September. The number of valuations on behalf of buy to let investors increased by 66% between August and September. This leaves buy to let activity up by 77% since September 2012.

‘September and early October are the very peak season of the rental market. But valuations for landlords hoping to expand their property portfolios now will only bring new homes onto the lettings market by around the end of the year. That’s why this is such positive news for the buy to let sector, because landlords are clearly confident that demand will still be there in several months,’ said Bagshaw.

‘Progress on the supply of rental homes will remain vital for tenants who haven’t yet joined the ranks of first time buyers. Luckily, there has never been a better time for landlords to expand portfolios, with buy to let mortgage rates the lowest they are likely to be for years,’ he added.

Article Source: http://www.propertywire.com/news/europe/uk-housing-market-surveyors-201310248383.html

London Property Capital Growth Boost from Growing Population

According to this article by WebWire on September 22th, 2013 the reason that the property capital market in London continue to boosts is because of the population growth.

London population growth boosts the property market. We investigate London areas of high capital growth. Which are good areas for London property investment?

How to make a good property investment by looking at supply and demand? Inward migration.

By the middle of 2012, the London population clicked over 8,308,000 inhabitants according to the office of National Statistics. The probably reason for the steady increase is the positive birth of 134,000 babies in the Capital. By contrast, the mortality rate was markedly lower at 47,570 fatalities in London during the same period.

Net migration added a further 69,000 people which was calculated from 176,000 arrivals from overseas subtracted by 107,000 departures.
 
Additionally, there are U.K residents that move to the Capital for work and some older residents move to the countryside when they retire. More U.K residents are moving to London and the South East in general as The North still struggles with slow growth and high unemployment.

The growth in the London population is not matched by the number of new homes being built. The target of 250,000 new homes has been missed for several years further exhibiting the housing crisis. Even though there was an improvement on the previous years’ new builds with 115,000 new property completions.   

Areas like Hackney and Islington have quite a number of Turkish and afro-Caribbean families that generally have larger families and have contributed to positive population growth rates. Islington is an excellent place for London Investment Property with exceptional rental demand because it is close to both ‘The City’ and West End.   

Wandsworth is another London borough that has benefited from the baby boom as it fits within (what is commonly known as) the ‘Nappy Valley’ where newly-wed city workers are starting their families. It is also in the catchment area of Chelsea, Fulham and the Nine Elms project near Battersea which are all extremely popular with overseas buyers.  Wandsworth experienced year on year Capital growth of 11%. 

Making money from property investment is not rocket science. A large contributor to creating a successful property portfolio is seeking out areas with an imbalance in supply and demand.

It really is quite simple, where there strong demand for rentals and there are few rental properties would result in higher rents and lower vacancy rates. Where there is shortage of properties for sale and large demand for properties results in price rises.

If we take Canterbury for instance there are 149,000 inhabitants and 46,000 student’s means that there is a lot of completion and demand for properties, the rents are high which makes for good investments and therefore demand for properties. It is a small Cathedral City with limited planning which restricts supply resulting in a 60% price rise that we have seen over the past 10 years.

‘Student migration now constitutes the largest category of migration to the UK. The student property market cannot be ignored…it is generating impressive returns; investment rental property in Canterbury has 9% rental income’ says Arran Kerkvliet director of One Touch Property Investment.

 The future looks bright for the student property market because the number of student applications continues to exceed available places. In June 2013, the UCAS figures confirm that the number of applications increased by 3.1% over the previous year.

In fact, the British Council predicts that over 8 Million students will study outside of their country of birth by 2025.

Article Source: http://www.webwire.com/ViewPressRel.asp?aId=180419#.Uj-dWD_tYh8

Buy To Let Property Investors Need Mentors

Like any other business you're engaged in, you need help from experts or mentors to be able to succeed as revealed in article by PR Newswire on September 17th, 2013.

Investing in residential property in the UK's 'buy to let' market can achieve handsome returns, but only if you invest wisely.

The pitfalls that await would-be and seasoned investors are well documented. But the way to avoid them is to get yourself some expert help. So get yourself a mentor.

Every investor is unique, so 4sale2U provide a personal service by assigning a member of their team to ascertain your individual property investment requirements. All 4sale2U staff are experts in property valuation and negotiation, their knowledge and experience is put to excellent use to get the right property at the right price to achieve the right return.

4sale2U is rapidly becoming one of the UK's biggest and best place for serious property investors to find property buy to let bargains. Experts at sourcing low cost properties, below market value properties (BMV) and helping investors (either seasoned professionals or first timers), 4sale2U can help you build a profitable property portfolio.

Chris Kelly, 4sale2U director, explains: "Currently we're achieving up to 12% yield for our clients. Our goal is to provide investors with real property bargains, but in return they need to be able to move quickly on any suitable available properties. It's a fast moving market but with our mentoring help clients can prosper."

However, buying a property is just the first stage, next you need to consider how you're going to manage it. 4sale2U can manage your investments efficiently and effectively through its lettings service (2let2U) or affiliate agents (although this is not a prerequisite).
Kelly adds: "We can take care of everything from renovation to references, plus we're up to scratch with all the latest regulations surrounding the tenancy market, so there's no need for an investor to burn the midnight oil trying to keep up with everything."

By taking care of an investor's property management (and maintenance) 4sale2U are able to help their investor clients focus on the best deals available and not get tied up with red tape and tenant issues.

Another service provided by 4sale2U is their regular eDM (electronic direct mail). "We send BMV, bargain property deals via email to our investors so they can see potential deals immediately, wherever they are." Explains Kelly. "If you're interested then simply go to the 4sale2U property investors' website 'buy cheap property' and register, it's easy and free. As a 'preferred investor' you will receive all our bargain property deals before they are sent out to our general investor database."

The mentoring service provided by 4sale2U is completely free but investors need to be in a position to buy quickly. If we are instructed to manage the property then normal letting management fees apply. But with returns up to a whopping 12% our clients find the fees a mere drop in the ocean and extremely good value for money.

Article Source: http://www.prnewswire.co.uk/news-releases/buy-to-let-property-investors-need-mentors-224098521.html

Adding Property Stocks to the Real Estate Investment Mix Strongly Boosts Returns

According to this article by Property Magazine International on September 6th, 2013 suggests that blending property stocks with real estate portfolios with non-listed investments generated yields for over the past decade compared with those with no listed property sector.

Real estate portfolios that blended stocks with non-listed investments generated 50% superior returns over the past decade compared with those with no listed property sector allocation, new research presented at the European Public Real Estate Association’s (EPRA) annual conference in Paris on Thursday showed.

A real estate investor with a 30% allocation to the international listed sector had a total return of 91% from June 2003 to June 2013, according to fund performance data compiled by consultants Consilia Capital. That compares with a 61% total return from U.K. non-listed real estate over the same decade, the study showed.

Alex Moss, Consilia Capital Managing Director said: “Our findings show how investors are missing out on superior returns by having no exposure to the listed sector. It is surprising that many institutions and investors treat the listed property sector as part of their equity allocation and that so few take an integrated approach for their real estate portfolio. We found plenty of evidence, however, to make us confident that significant changes are afoot.”

A separate survey compiled by Consilia and Andrew Baum of Property Funds Research showed that 46% of respondents treat the listed property sector separately from their real estate portfolio. Just 14% have an integrated team spanning listed and non-listed or direct real estate investments, while 39% outsource management of their listed property allocation.

The survey’s respondents said their annual performance reviews discourage investment in the listed property sector because of short-term share price volatility, which may be correlated with other equities. This is the biggest obstacle to using quoted companies in building a real estate portfolio, even though these securities generate long-term returns that match their objectives, the survey showed.

The parallel study’s breakdown of the performance of the different fund types revealed, however, a surprisingly marginal diminution in returns from a listed property exposure during the height of the market dislocation of the Global Financial Crisis.

A combination of UK non-listed real estate funds with a 30% international listed real estate allocation returned 2.2% less than pure non-listed property funds from July 2007-June 2009. During the four preceding years this same approach delivered an outperformance of 22%, while from August 2009 to June 2013, it would have enhanced returns by 13%.

Respondents to the survey, notably defined contribution pension schemes, are warming to listed real estate because of the liquidity that stocks provide. Other attractions of the sector are much easier portfolio diversification, either by property sector, country or globally, while investing in quoted companies also involves lower transaction costs, the survey showed.

Consilia’s Moss said: “Using listed real estate as part of a broader property allocation strategy is gaining momentum. Most significantly, the U.K.’s National Employment Savings Trust has made a landmark decision that promises to channel billions of pounds of fresh investment into the listed property sector in coming years.”

NEST will earmark one fifth of total investment to Legal & General’s Hybrid Property Fund, which currently invests 30% of its assets in a global real estate equity fund. Established as part of reforms introducing automatic enrolment to U.K. workplace defined contribution pension schemes, NEST indicates that its assets under management will swell to £150 billion by 2030.

Article Source: http://www.property-magazine.eu/adding-property-stocks-to-the-real-estate-investment-mix-strongly-boosts-returns-25968.html