Belvoir News Article

30/10/2007 - Mouseholding on the up as first time buyers struggle to secure urban properties

With the UK property market facing uncertain times, the phenomenon dubbed as ‘mouseholding’ is on the up. According to Belvoir, the UK’s leading lettings agency, which has an office on Union Street in Aberdeen, mouseholding involves buyers increasing their long term buying power by investing in cheaper but emerging rural areas where they are likely to see strong capital growth.

While current market conditions mean that some property investors and first time buyers are getting cold feet in UK towns and cities, there is still considerable interest in particular rural areas where house prices have risen at a slower rate in recent years. As well as still being affordable, properties in these areas are also viewed as better investment opportunities in the longer term.

Belvoir offers a range of professional property services to tenants and landlords, including expert advice on all aspects of property management and portfolio development. The company has a growing network of franchises which stretches across the whole UK and looks after a property portfolio valued at more than £1 billion.

Commenting on the mouseholding phenomenon, Belvoir Chief Executive Mike Goddard says: “Getting a foot on the property ladder is, as we know, becoming ever more difficult for the first time buyer. In recent weeks concerns over the current state of the market and the problems faced by Northern Rock has meant that many lenders have been tightening their procedures when it comes to offering mortgages to new homeowners.“Investors are becoming far more cautious because of the expectation that the market in urban areas will slow down or stall for a while,” he says.

“The phenomenal rise in property prices in recent years has, however, not been as dramatic in some parts of the country and in certain rural areas in particular, there are still real bargains to be had,” Mike says. “We are seeing a lot of interest from first time buyers looking to get a foot on the ladder in such areas. Many of them see cheaper rural properties as viable long term investment opportunities and plan to remain living in rented accommodation in the city whilst letting out their rural homes to cover mortgage payments. This is also having a
positive impact on the rental market in both urban and rural areas.

“The expectation is that, in the longer term, first time buyers in particular can increase their purchasing power as they enjoy capital growth on their country property, eventually allowing them to buy in an urban area should they so choose,” concludes Mike. Belvoir offers the following advice to would-be mouseholders:

• Do your homework – research rural property markets and find out where the best bargains are to be had.
  
• Before buying, speak to a reputable letting agent to get an honest view of the lettings market in the area both now and in the longer term.
  
• Consider employing a property management specialist to look after your mousehold property for you. Trying to manage a property from a distance can be fraught with difficulty.
  
• Some mouseholders are looking overseas to get a foot on the property ladder. However, other European property markets are suffering from conditions far more difficult than those we are currently facing in the UK, so before you make a final decision, don’t let the sun go to your head.
  
• To ensure the best rental returns on any mousehold property, try and build any renovation and redecoration costs into your overall budget as properties which are presented to a high standard are the ones which enjoy long term, stable rental income.

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