Investing Trends

Investment property is still proving to be one of the most popular forms of investment. Property in the UK has historically doubled in value every 10-15 years and regardless of the peaks and troughs during this time, investment property has steadily become one of the most stable ways to invest for the future as opposed to stocks and shares and other investment options.

Established landlords with investment property are very aware of the benefits of investing in property and in particular investment property in the UK. With affordability becoming one of the main issues for first time buyers, landlords are keen to snap up investment property in the UK in the knowledge that first time buyers and other buyers with affordability issues will be left with no alternative but to rent. It is the buy to let investment property market that landlords capitalise on and investment property is their key to success particularly during times when interest rates are rising and investment property prices are rising they are even more keen to buy to rent to this sector.

Investment property in the UK is a key topic of conversation and there are now more than 750,000 individuals who have at least one investment property that they have bought as a buy to let investment property. With buy to let mortgages for investment property becoming more readily available it is giving first time entrants to the buy to let investment property market an even greater chance of owning more than one investment property. Ideally, buy to let investment property investors will be keen to develop their investment property portfolio to such a level where they have multiple investment properties which are all likely to enjoy good capital appreciation. For those more mature entrants to the investment property market, they may be more focused on trying to buy investment property that provides them with a 'passive income' from their investment property on a monthly basis. These types of investment properties are generally lower value, but may present a higher rental yield but subsequently the capital appreciation on these buy to let investment properties may be a little slower.

As and when the opportunities arise, shrewd property investors will refinance their buy to let investment property during a strong property market to realise any potential profit from their investment property portfolio which can then be used to purchase additional investment property to add to their buy to let investment property portfolio. Buy to let mortgages for investment property are so varied in choice that it is much easier to obtain good competitive buy to let mortgage products on almost all types of investment property in the UK. Even those where the investment property in the UK is held within a Ltd Company where previously the products available for these may have been more restrictive.

TYPES OF PROPERTIES FOUND AT AUCTIONS

This short article proposes a guide to assist you in understanding the value of the UK Property Auction market. Literally thousands of properties are available week in and week out. At any given time properties are coming under the hammer in auctions, most of which are sold at prices far below market value. This is happening throughout the UK and in the USA.

Nevertheless it's vital to know the latent pros and cons when trading at auction. Moreover, you should aim to understand where the major bargains are obtainable. The details of thousands of low-priced, repossessed, auction properties are also available at Property Auction Bargains. It's absolutely reasonable to anticipate paying 15% to 40% less for a property at auction than you would for the equivalent property through an estate agent. For instance, at a recent auction a studio flat was sold in London for a measly £9,000.

In another, a 2 bed flat right on the south coast with a market value of up to £100,000 sold for just £14,000 at auction. And those are just a few examples of the countless bargains that individuals find at each and every week.

TYPES OF PROPERTIES FOUND AT AUCTIONS

Repossessions - Sadly for the previous owners, repossessions can often be picked up at bargain prices through auctions.
Investment properties – these are properties, which are valued due to the return on investment that they provide. Includes everything from individual office/shop investments to blocks of flats.

Badly maintained properties - Auctions are fantastic places to find properties that are in a state that causes them to be unsaleable.
It may not take a great deal of extra effort to bring them up to market condition. The attraction here is if you can get such a property in a good location at a cheap price it's perfectly possible to refurbish and resell on at handsome profits. Indeed there're individuals and organisations that make their living doing this.

Unshakeable properties come under the following categories: Derelict or in derelict areas. Subject to severe disrepair. Subject to
local authority notices. Subject to closing orders.

Offered with ambiguous legal titles – some properties are sold with a lack of legal documentation and thus they are less desirable to the general property investor.

Sold without access. Sold with major fencing, paving, drainage or other similar responsibilities.

Sold subject to covenants or restrictions, which prevent normal use.

Exceptional properties - Include ones that have historical meaning and plots which 'get in the way' of major development projects.

Ken McElroy, author of "The ABCs of Real Estate Investing," has a method he uses to find prospective investment real estate. He's been at it for a long time but, he says, no matter how much experience he gains, he always uses the same method.

Research, research, research. "I have never purchased a single property without going through this process," he says.

His process is one that allows him to quickly narrow the scope of his search, and he describes it in terms of levels. Level I research, he says, is something you don't even have to leave your house to do. He calls it "the very preliminary stuff."

You may go online and research the major markets in a given area of the U.S. to discover the best cities in which to invest. You want to look at quality of life, economy, industry and population. Look at the newspapers and business journals in every city that interests you. Follow the links. Discover everything you can.

Now you're ready for Level II—choose a city and make contact.

What you want to do now is begin setting up your team. This is not something you want to skimp on. These are the professionals you are going to have to employ to get things going, experts whose opinions you will want to use. Your team will be able to see things that you cannot, because of its areas of expertise and because of its familiarity with the city. Your team members will be people in the industry and who have contact with the industry—such as lawyers, accountants and brokers.

Not all of your meetings at this phase are about setting up your team. In fact, you are simply attempting to gather information about the city at this point. But the knowledge that your contacts demonstrate at this point will clue you in on whether you want them on your team when it is time to make that step.

Level III happens when you return home. This is when you fill in any gaps that are left in your knowledge. Sign up for newsletters, have your contacts set you up with lawmakers and other business people who can give you accurate projections of the sub markets in the area, crime statistics, construction plans—anything that may influence how good an investment a piece of property is.

When it is time to make a decision about which area in which to look for property, start in the place you would most like to invest. Start there even if you don't think you can afford to buy there. You never know what you will find. According to McElroy, there are deals everywhere, even in the most desirable locations. Something that needs a lot of cosmetic work may actually be in fine structural condition. A place like that can be a real "diamond in the rough," according to McElroy.

He advises that you take a skeptical approach, and says he never actually expects deals to go through. This isn't negativity, he says. It simply allows him to retain the option of walking away, keeps him from putting too much effort into making the deal happen. If you have to try too hard for it, then it isn't a good deal. You have to be willing to walk away from any piece of property.