Saturday, February 18, 2006

London house market confidence returns

London house market confidence returns
17 February 2006

The latest data from Haart estate agents shows that the average London house price has increased by 2% as confidence returns to the London housing market.

The average price of property in London is now £238,305 up from £233,317 in December. High salary levels, a shortage of good quality stock, record Christmas city bonuses and renewed confidence, particularly with first-time buyers, have all contributed to boosting house prices.

The London housing market has had a very strong start to the year, said haart. At the end of last year sale transactions increased by 100% over a 12 month period and the level of activity has carried over to the New Year with a 10% swell in applicants. As a result the average time to sell a property has dropped by 5 days to 20 days as more buyers return to the market.

Along with increased activity in the housing market there are strong signs that first-time buyers are coming back with a vengeance with a further 1% increase in first-time buyer levels raising it to 24% in January, the highest levels since the index began.

Paul Smith, chief executive of Spicerhaart comments: 'The rise in activity levels, and more pertinently first-time buyer levels, reflects a marked increase in confidence.'
'Potential buyers that have been waiting for the market to turn have finally accepted that it is not going to crash. As a result of the improved confidence and market activity we are seeing properties, at the right price, being snapped up in days, even hours.'
'With the high activity levels from the end of 2005 carrying into January house prices are set to continue to rise into certainly the first half of this year when a months worth of pent up activity is released."

London is in a special situation and I would not expect this strength to be reflected in the regions.

Chris Bell

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Friday, February 17, 2006

Ten tips for buy-to-let

Ten tips for buy-to-let
Simon Lambert, This is Money
17 February 2006

POOR old buy-to-let. Once upon a time it was David Beckham, Wayne Rooney and Kate Moss all rolled into one - making headlines on a daily basis with every move endlessly analysed.

But now it's become an ex-reality television star - struggling to make the news while the stock market has all the flashbulbs popping as the FTSE 100 soars.

But while it's not quite the hot property it once was, investors looking for steady growth are returning to the buy-to-let market.

Industry experts predict 2006 will be a solid year for buy-to-let and say with the days of rocketing short-term capital growth gone, long-term investors are set to benefit.

Like any investment, buy-to-let comes with no guarantees, but for those who have more faith in bricks and mortar than stocks and shares here are This is Money's top ten tips:"

You'll have to click on the headline to get the actual buy-to-let tips! But this article is a good lead into the 'This Is Money' website.

Chris Bell

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Property investment clubs and inflated valuations

Property Article | Reuters.co.ukClick here for full article
Thu Feb 16, 2006 8:40 AM GMT

By Lorna Bourke
LONDON (Citywire) - Buy-to-let valuations on new properties face increasing scrutiny and investors could soon find it more difficult to arrange a loan. However, a well informed adviser can make all the difference.

Last December Matthew Wyles, director of Mortgage Works, pulled out of buy-to-let lending on new property developments, with the immortal words: 'Owing to the current oversupply of newly built property, valuation in this sector is more of an art than a science.'

Wyles was dropping a heavy hint that questionable practices were being used to inflate the true value of this type of property.

The surprise was not that Mortgage Works was withdrawing from new build lending, but that Wyles was reacting to what everyone in the market knew had been going on for a long time.

The Council of Mortgage Lenders (CML) and the Royal Institution of Chartered Surveyors (RICS) are still locked in debate about how to solve what has been described as a valuation problem rather than a buy-to-let issue, but no one wants to admit that anyone is at fault.

'The reality of the situation is that lenders have to lend and some cannot afford to pull out of this market,' says a broker who does not wish to be identified. 'While the market was rising, the lenders were not concerned.'

The lenders deny contributing to the situation by accepting inflated valuations and turning a blind eye to what only became a problem when house prices slowed.

'There are issues clearly in the property investment club area but they have not flowed through into the buy-to-let and main residential mortgage market," says John Heron of buy-to-let lender Paragon."

Take care with property investment club offerings - as you should whenever someone appears to be offering you guaranteed profis on a plate.

Chris Bell

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