BEWARE-LOW FLYING REINDEER
You know it’s almost Xmas when you can hear the buzz of low flying reindeer at night, or could it possibly be the nearby East Midlands Airport.
As another year of buy-to-let investing draws to an end, some landlords will be richer some poorer, but all of us will be older. It certainly has been a ‘game of two halves’. In the first half of the year the big story has continued to be the booming buy-to-let and rental market in the southern half of the country and in particularly in London. The second half has been ‘doom & gloom’ and the ‘credit crunch’.
Where next for buy-to-let?
There are so many macro and micro imponderables that all could have a bearing in what happens over the coming year that to give a firm steer is almost impossible. However, what is certain is the wheels on the great big property juggernaut are slowing. As Bill Clinton once famously said “it’s the economy stupid”. What happens in the buy-to-let investment market and the wider housing market will pretty much depend on what goes on in the economy and much of this will come back to how the ‘credit crunch’ pans out.
In simple terms we have had an environment where lenders who have been prepared to lend cheaply and freely over the last few years. Much of this cheap money has gone into buying assets such as buy-to-let property, translating into high asset price inflation. Now suddenly these same bankers are worried after seeing what happened in the US with the sub-prime debacle. They are now belatedly concerned about what happens if prices of assets such as buy-to-let property come down; or the borrowers can’t repay their loans. As a result they have suddenly reduced the amount and the frequency that they lend at a stroke making assets more difficult to buy and effectively more expensive as individuals & companies have to use more of their own cash to finance a purchase. This is of course unless prices come down. The worry for all buy-to-let landlords and property investors is that what starts as a credit crunch becomes a property slump, only time will tell.
Certainty & honesty
One thing that landlord will be able to depend on is that Property Hawk will be back next year with more news, insightful comment and ways for landlords to invest and survive even in a stagnating buy-to-let market. Many landlord sites continue to ‘peddle’ the buy-to-let dream, featuring meaningless news feeds that pretend that the market is booming. We know as you do this simply isn’t true. You can rely on us to be honest even when it makes uncomfortable reading.
Our team is set to expand and with this enlarged manpower we have some pretty ambitious plans for developing the website including a massive expansion of the mortgage part of the website. This will offer landlords a unique way of finding a buy-to-let mortgage enabling Property Hawk users to ‘out gun’ Google.
Landlords don’t forget about your tax. The deadline for self assessment returns is 31st January and landlords can use the Property Manager to help them compile their tax figures.
Remember those landlords wanting to sell their buy-to-let property will now need to have a Home Information Pack or HIP irrespective of how large or small their buy-to-let investment property is. Thanks to Europe and this Government’s acquiescence on this European driven legislation we end up with another piece of paper to collect. Can anybody even remember what they are for and what they are supposed to do?
Finally, landlords should remember to be very careful at night of low flying reindeer. Only Rudolph is health and safety compliant with his glowing red nose having the required level of illumination. Just in case the worst should happen, make sure you have a look at this article on landlords preparing their will.
Happy Xmas or Bah, Humbug.
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