Is now a good time to invest in property? [Audio]

Another question I am frequently asked is ‘Is now a good time to invest in property?’

I get this asked a lot as people tend to be led by negative press reports or what’s reported in the news. We are in uncertain times, and prices have fallen over the last few years. Having said that, they have been pretty in most areas for the last 2 to 3 years – going up or down a percent or two.

As a country we are very much ruled by house prices as a guide to how confident we feel in the economy.

So let’s look at it this way, if you were given the choice and had the same house that you could buy for either £60,000 or you could buy it for £80,000 which would you go for? Obviously you would want to buy it for £60,000 but when prices are lower, people are influenced by what they perceive to be a ‘risky’ investment’ and they wait until confidence returns and house prices rise before investing. They get caught up in the hype and do look at what the property could bring them in terms of cash flow in the short term. They believe that by buying ‘high’ they are minimizing their risk. However, had you bought at the lower price of £60,000 you would not only have made £20,000 in capital gains, you would also be making an immediate income and your mortgage will be a lot lower allowing you to repay it much faster.

If you wait for the market to tell you it’s a good time to buy, the investment is more risky than if you do your due diligence and buy low. So it’s when house prices dip that you should buy – making now an ideal time as prices are set to rise in the long term.

The housing market is cyclical of course, it goes up and down. But if you were to look at a trend line, over time it only goes up. We know it’s been down last few years and is stable at the moment, and interest rates have been at an historic low (0.5% since March 2009) which is the lowest it’s been for that length of time, and it’s set to go down to 0.25% next year (whether it will remains to be seen). Therefore buy to let mortgage rates are incredibly competitive at present, which is what you want when looking to invest.

At present everything is in place to enable your investment to be sound – low prices, good interest rates, high demand for rental property as people can’t afford, rental prices set to rise and pensions underperforming.

In terms of pension, now is a great time to invest in property as it’s always advisable explore other income streams to support you in your retirement years. After all, if you look at the rich list – the top 80% have made their money in property. Even just one or two properties can make a huge difference to your income and stability, and now is the time to buy when rates are low and property is cheap.

Even if property prices were to dip slightly, even by say 3% if you have bought at a good price and you are getting a good cash flow, and have fixed rate you know what income you are going to get in the next few years so a small drop in property value is irrelevant. There are other ways to make property work for you and reduce the risk – ways that you won’t hear about in the press as it’s usually all doom and gloom. It’s about keeping control, doing your homework and going with that looks like a good deal.

If you want to talk to me about due diligence, and where or how to invest for profit talk to me, Gill Alton from Alton Property Partners.

Listen to our blog post on why property is a good investment.

Gill Alton

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Gill Alton is the founder of Alton Property Partners, which provides a comprehensive and personal Property Portfolio Building Service for investors in the UK.

Alton Property Partners manage the entire investment process, from sourcing property at a discounted value, co-ordinating the Mortgage, arranging the refurbishment, right through to ensuring it is ready for the rental market.

The service is specifically aimed to support those who recognise the value of a UK investment portfolio, but lack the time, or knowledge to be able to invest for themselves because they are full time employees or Business Owners. With full consultation and comprehensive financial analysis, clients can be assured that their portfolio of strong yielding properties will be built to exacting standards and they will be kept up to date every step of the way.

Having been involved in property for 16 years Gill has built a personal portfolio for her family, and in addition to Alton Property Partners, runs a Property Mentoring Business, Venus Property Mentoring which focuses on supporting new investors onto the investing ladder. Having originally left the Corporate world to be a Qualified Mortgage Broker, Gill’s husband now focuses on their family Mortgage Brokerage in Maidenhead – Alton Mortgages.

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Alton Property Partners
6 Bramble Drive, Maidenhead BerkshireUKSL6 3NX United Kindom •0845-095-5060

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