North East Buy To Let - ONEPORTFOLIO
Will There Be A UK Property Crash?
Before examining the factors influencing the current property market it is important for investors, and especially first time investors, to think like property investors not private homeowners.
As a private homeowner a fall in property prices is not good news.
Equity is reduced and for those wishing to sell, the sellers market of the past 10 years may turn into a buyers market. This inevitably leads to buyers making offers under the asking price.
However for property investors, if prices fall, the market presents buying opportunities as sellers are more likely to accept offers well below market value. Therefore if prices do fall it could be good news for investors looking to buy, especially for first time investors looking to secure a bargain entry into property investment.
Irrespective of the short term factors that could bring about this fall in prices ie., rising interest rates, HIPS, adverse media comment etc., the fundamentals of supply and demand mentioned earlier remain.
Quite simply, the UK has a housing crisis. There is a huge shortfall in the number of new houses being built compared to new homes required. The reluctance of Government and local authorities to build on green belt land means that there is no sign of this shortfall being redressed. In fact, it is likely to get worse each year.
Short supply and high demand will therefore remain in the property market for many years to come which will inevitably lead to inflation beating price increases.
During the housing crash of the 1980’s interest rates reached historically high levels during a period when the economy was slowing down and inflation was still high. This is not the case today.
Interest rates, despite the recent rises, are still historically low; the economy is strong; and inflation is not a major problem. Therefore, any fall in prices is unlikely to be severe, and the long term potential for house prices and property investment remains very positive.
The key is to identify your objectives, formulate your strategy, and only buy investment property which meets your personal investment criteria.
Are you interested in North East Buy To Let property? The North East offers high rental returns and capital growth. For more information and free advice visit ONEPORTFOLIO Investment Property NOW.
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ONEPORTFOLIO Investment Property, the only company in the UK offering 20% below market value property deals direct from the vendor.
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