Category Archives: properties
Short-term deflation is welcome relief
by Richard Butler-Creagh
With food prices dropping at the quickest rate in eight years in January, combined with further falls in the price of vehicle fuels, consumer price inflation is likely to move to a new record low in January, edging the UK economy closer to deflation, as such it looks increasingly unlikely the Bank of England will raise the base rate in 2015. The Centre for Economics and Business Research said: “The headline rate of inflation, as measured by the Consumer Price Index, fell to just 0.5% in December.” This is welcome news after the last couple of years of steep inflation, as high as 10% when taking into account the steep rise of fuel and food, according to some indicators. Savers have been worse off with the inflation eroding their accounts and making their hard-earned worth less by the low interest rate.
There are other indicators that the slow-down is slowing down. Banks are cautiously making funds more available to borrowers. Barclays have shuffled into the lead enticing buyers wanting to fix for five years, with deals starting at 2.29%, a cut of 0.1% from a week ago. First Direct has also shaved 0.2% off its five-year deal with a 2.59% fix until 2020. As usual these are for lenders with large deposits, normally 30% or more, but it is all suggesting that the market is heading for an increase in activity. When choosing a lender based on these 0.1 or 0.2% differences, remember to blends in the arrangement fees as they can alter the overall rate.
House prices still managed to increase last month with figures from Halifax showing that it jumped an incredible 2% taking the average to £193,130. This could be due to the reform of stamp duty producing a temporary wave, a spokesman said.
Richard Butler-Creagh
Extra Council Tax Band for Properties Over £2M
Booming London house prices are likely to be subject to a new levy soon after the general election, should the Liberal Democrats or Labour get into power, says the Chief Secretary to the Treasury, Danny Alexander in a speech to the city yesterday, writes The Times. Read the rest of this entry
Buy to Let
The buy to let business is a good long term investment if you are prepared to work at it. First you have to find the right location, this a very important part of the business, get it wrong and you will pay dearly. When I started in this business I use to look in the areas I enjoy going to, it always makes life easier if when you have to go to the property for what ever reason its a place you like to hang out in so its not a chore. The next thing is to make sure its close to pubic transport, in london for instance it can make a lot of difference if it is zone 1 or 2 and so on. This a long term investment so you should look to the future and think what the next up and coming areas are, for instance when I started buying property I bought on the edge of a good area like west hampstead you can go closer to Kilburn which is not quite as good an address as West Hampstead but still popular and when it comes down to buying you get more for your money and as time moves on it becomes more expensive and the difference in rent from a property in the centre of West Hampstead and on the outskirts is not that much so can pay less when buying but get close to the same rent when renting. the next thing is kitting the place out, keep it simple and not cluttered make it so easy so that when the tenants move out it is easy just to freshen up and get ready for the next tenant. Rent, do your home because the tenants will, they will know exactly what the going rate is, if you are to high in price because you paid to much or spent to much on getting the property ready you will be waiting a long time to find a tenant.
Richard Butler-Creagh
Property bubble
One of the largest house-builders in Britain recently dismissed fears of a housing bubble as it reported booming demand for its new homes. The House builders revenues jumped 21% last year after it sold nearly 12,000 homes and that is with sales 30% higher in the second half than the first. One of the rival companies also have record profits for the six months to the end of December so it seems that the industry is starting the new year in a really bullish mood. all this came as figures from the mortgage lender, Halifax, showed house prices had dipped 0.6% in December but are still 7.5% higher than a year ago.
The whole of the housing market has had a remarkable recovery after many years of stagnation boosted by increased mortgage lending and assistance from the state-backed schemes such as Help to Buy. Many people think that the revival has fuelled a housing bubble and this has caused the Bank of England to scale back the funding for lending scheme so it no longer applies to mortgages.
Some of the large house builders say they don’t think there is a bubble, they say they cover the whole of the country and think the pricing is stable across the board.
I think the main thing is that if wages increase inline with house prices there should not be a bubble, but as we know this is not the case so people buying property when interest rates are at record lows, it would not take much of an increase to make things very difficult for a lot of new home owners who are pushing themselves to all time highs in prices. One thing is for sure interest rates can only go one way at the moment, so as I have said in the past it is a good time to fix a good rate with your lender.
Richard Butler-Creagh
Richard Butler-Creagh 