Belvoir News Article
02 October 2007 - Home and Away
- UK buy to let market boosted as ‘the strain in Spain’ continues
Investing in the UK property market is not without risk. However, as cracks start to appear in traditional overseas property markets such as Spain, Belvoir, the residential lettings and property management specialist, which operates a national network of over 100 offices,says more cautious investors are taking a fresh look at buy to let properties on their own home turf.
Some 800,000 properties are currently under construction in Spain but, as house prices there start to decline, it is inevitable that some of these properties will remain on the market for some time. Indeed, there are now fears that the Spanish property market could go into serious freefall as supply outstrips demand – a major concern for those who have recently invested in Spain. Furthermore, rental incomes from Spanish properties are also under threat as holidaymakers turn their back on Spain, thus compounding the problem for British investors.
New markets such as Poland, Turkey and even further afield are proving popular with some speculative investors who are looking for quick returns on their investment and are willing to accept any associated risks. According to Belvoir, today’s smart investor is not always looking for a quick buck. Indeed the company reports that many of those turning to them for professional investment advice are now more interested in a secure, long-term investment.
And for those people, Belvoir’s advice is nearly always the same – stick to your home turf and invest in UK property rather than running the risk of buying into an emerging market which is riddled with uncertainty. Belvoir Chief Executive Mike Goddard says: “Most people still view property as a good investment although they are perhaps more cautious than they were in previous years.”
“When they come to us for advice, many of them have already considered investing in an overseas property,” he continues. “However, increasingly they want to weigh up their options and compare any returns they might get with those secured from buying a property in the UK.”
“As with any investment there are, of course, no 100% guarantees but we would advise that putting your money into property in the UK remains a safer long term investment,” says Mike. “Spain is a classic example of how, after a period of frenzied investment, an overseas market can start to go wrong and I think a lot of people will find they have got their fingers burnt. While investors are now eyeing up new markets where they could make a quick buck, anyone looking for a long term secure investment would, in my opinion, be better off buying something on their doorstep here in the UK” So what are the advantages in investing in property in the UK? Belvoir offers the following evidence:
- Historically, the UK housing market has continued to see steady growth over the long term
- Returns may be lower than in other markets at present but these are likely to be more secure and, the smart investor can still make higher returns by doing their homework and investing in the UK’s growth areas.
- Demand for housing outstrips supply in the UK and is forecast to do so for at least another 20 years.
- Rental values and yields are on the up as demand for rental properties grows. Market analysis suggests that this trend will continue for the foreseeable future.
- Managing and maintaining a property in the UK is far easier than a property overseas.
- Searching for and securing a property will be far easier – and often cheaper – in the UK than overseas. Legal and financial transactions will be easier to manage.
- A property in the UK can enjoy year round rental income while overseas properties may be reliant on the holiday trade – despite the continuity of low cost flights to certain destinations.
- Legal transactions in UK are often a lot safer, given the transparency of ownership allowed through the Land Registry’s ‘Freedom of Information Act’– such information is often not available in other<
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