The return of a famous name to the world of buy to let lending could be a turning point for the battered fortunes of residential landlords. That name is Paragon who has been particularly conspicuous by their absence in the buy to let lenders listings in recent years. Many in the banking and mortgage world believe that Paragon?s return to the market for the first time since February 2008 is a turning point for mortgage funding. The number of buy to let mortgage products available has fallen from over three and a half thousand in July 2007 to less than three hundred currently available. Will the return of this buy to let lending giant mark a return to sensible competition in the buy to let mortgage market?
Elphinstone Estates goes into administration, and the vultures are circling for cut price development sites and other land deals. The company has suffered like many other property development companies, and although they have been filing planning applications and working on increasing the site values through planning gains and good quality development appraisals. The company has suffered from that old favorite of the property development world cash flow, simple running out of cash the life blood of any business. The world of property development requires intelligent funding solutions and accurate cash flow forecasting and if someone gets that wrong the results can be disastrous for the company.
The Bank of England has urged savers to eat into their cash reserves, a spokes person said they would rather see house holders spending than saving. The Bank of England spokes person said do not expect bank base rates to remain at these historic lows for the next decade. I found that interesting as with all political statements the telling part is usually in the comments the spokes people do not make. So by saying that bank base rates will not remain this low for a decade, can we take it that they could remain at these historic lows for the next few years?
Another interesting point is that the Bank of England is due to announce the next decision on interest rates next week, could these comments have been released in an attempt to soften the blow to savers? With further talk of quantitative easing (that?s printing money for the more cynical readers) on both sides of the pond, is it more likely that bank base rates will remain stagnant next week?
So what will the impact on the property and construction industries be? Well continuing low interest rates will have a positive effect on the UK property market, and an increase in household spending has to good news for home extensions and home improvements.
1. Make sure you have your finance in position once the gavel falls you will usually only have 21days to complete and a couple of hold ups or a bank holiday and time can soon become an issue. The penalties for not completing in the prescribed time period can be heavy.
2. Have you reviewed the legal pack? There is usually a well prepared legal pack that contains detail on the property?s title and other important legal documentation.
3. Do you have the right team on board from your solicitor through to your building contractor choosing a team with auction experience will make your purchase and project run more smoothly.
4. Keep in contact with the auctioneer, sometimes they release amendments to the auction or legal pack that can radically affect a property?s value either up or down. So make sure you have reviewed the most up to date information.
5. If you are the successful bidder you will need personal identification, ten years ago you could pretty much wonder in to the auction room leave some company details and a company cheque and the auctioneer would have accepted that. Now you need several forms of personal identification and proof of cleared funds for the deposit. So check with the auction house the criteria you need to achieve.
Speakers at the council of mortgage lending expressed their concern at what they see as overzealous mortgage lending restrictions. With the UK housing market staging a fragile recovery, mortgage lending is a critical component in that housing market recovery. Speakers suggested that lending restrictions would play a greater part in cooling the market than either consumer appetite or bank lending criteria. The decision on ratio of reserve holdings to lending which is presently under review, will spell a critical moment for future of the housing market recovery.
These moves could cause house prices to fall which in turn will lead to further blood letting as people become mortgage and property prisoners, as they cannot remortgage or face negative equity. The concern is that over correction of regulation in the banking sector will inevitably lead to over correction in house prices and ultimately over correction in the wider economy.
What happens to those probate properties, the repossession and properties in a poor state of repair, well historically many of these properties found their way into the hands of first time or amateur property developers? These first time developers do play an important role in the property cycle, they tidy up many properties at the bottom of the market and often provide good starter homes for first time buyers. However the lack of suitable mortgage products for these property developers and their potential customers has left many shutting up shop. With many commercial and residential property developers also wresterling with a shortage of property development finance or property development funding, those looking to buy ready done homes may struggle.
With the creation of more and more specialist investment funds and investment vehicles the contrarian investors are quietly moving their funds into property. With rumors circulating that the former founder of Foxtons is launching his own property fund. Many believe that those canny investors with cash on the hip are looking to maximize their returns from property development and investment. With the banks taking a back seat on development and property lending, these private investors are even more essential to the UK house building sector.
Many of these investment funds are looking to partner up with main contractors and other joint venture partners and put together management teams with a proven track record in property development.
This challenge would have seemed almost farcical a few years ago at the height of the property boom, as development land increased in value on a daily basis.
However in these more challenging time for property developers many property developers or building site owners are finding it increasingly challenging to liquidise their property assets. So what are the options for those who wish to trade their patch of waste land or garden for a stack of cash? The conventional method is to enlist the assistance of a land agent who will push the land on their web site and list it on the land sales web sites. The other methods include joint ventures this is when the land owner teams up with a builder or main contractor and they exchange their profit for a share of the developer?s profits. There are several advantages in joint venture property developments one is that the cash input can be nil or drastically reduced as the land can be gifted to a special purpose vehicle which then carries out the development. This special purpose vehicle usually a limited company or LLP (limited liability partnership) can then raise the funding for the construction phase using the land as unencumbered security. The building contractor will often work on ?open books?, or ?cost plus?, this is when a main contractor carries out the construction or build phase at cost or cost plus ten percent.
The continued challenges that face first time buyers applying for mortgages coupled with an increased number of suitable first time buyers properties hitting the market has had a restraining affect on house prices. The low levels of transactions reported by the Royal Institute of Chartered Surveyors is as a direct result of more properties hitting the market but a shortage of well financed first time buyers to push up completed sales.
Heli tie cross stitching bars are a great way to repair cracks to brickwork and other masonry, you will benefit from our experience in using this fabulous process. In essence the mortar joints between the bricks are ground out and the Heli tie cross stitching bars are inserted and set in position with a specialist resin. Once this resin has been applied the joints are repointed and the masonry is now solid providing that the settlement, heave, or other structural issues have been resolved prior to the Heli tie cross stitching bars being inserted.
We can also assist in the assessment of the original structural issue we have access to some of the region?s best structural engineers. Remember using a good structural engineer could potentially save you the costs of carrying out non essential structural repairs.
We often carry out two or three of these repairs per week and are the preferred contractor of many of the region?s most successful property experts.
So call now for total peace of mind