Maidenhead Property Articles

Off-Plan property purchase scheme has become very popular amongst the investors in the recent years.

Purchasing an off-plan property simply means buying a property before it is built. Appleton Estate Agents Maidenhead state that these properties tend to be mostly flats. For the buyers, one of the biggest advantages is the flexibility to influence the finishing, such as the worktops, carpets, etc.

For the property investors, this scheme has a lot more significance associated though:

The property development companies aim to secure their financial position as quickly as possible. They aim not to get their capital tied up in a development for long periods so that they can start up their next project. Like any other retail trade, they tend to choose discounting as an effective way of luring the buyers in and release their capital as early as possible.

Some of the investors do claim getting up to 15-18% discounts and in some cases even getting their stamp duty paid this way.

Appleton Estate Agents Maidenhead insist the key benefit for the property investor is that typically the prices increase as the development property progresses.

When the development completes, the investor still retains the option to complete the purchase. Investor may prefer to keep the property and rent it out or sell it and realise the capital growth that has been achieved during the build, including any discounts he/she has had. Selling before the completion of the property is called Flipping and some developers may have clauses against this if they are offering discounts.Flipping is popular by some investors as they can get their capital out as quickly as possible, similar to the developers and move on to their next project with some profit.

Either way, Off-plan property purchasing is often seen as a very good opportunity.

As Appleton Estate Agents Reading, we encourage our customers who wish to go down this route to ask for financial and professional advice before making any commitments. Not all the discounted off-plan properties should be treated as good rental investment. If you have any queries, feel free to contact us for further consultation.

The government has announced that in England and Wales, the controversial Home Information Packs (HIPs) will be mandatory for all properties sold from the 14th of December.

Initially the HIPs were required for the sales of all properties with 4 or more bedrooms. Since September of this year, the scheme was extended to cover all the properties with 3 or more bedrooms.

Since their introduction, the HIPs have been very controversial as most people claim that they make the sale process more complicated and costly without significant tangible benefits. The average cost of a HIP is around £300-£350.

Following on from the initial expansion of the scheme to cover 3 bedroom properties in September, the Royal Institution of Chartered Surveyors (RICS) has claimed that more than half of its members have recorded a fall in the number of three-bedroom-plus properties coming on the market.

However, the government is still insisting that the HIPs will bring benefit to the consumers. They claim that the packs will especially provide more information for the the first-time buyers.

Appleton Estate Agents Maidenhead argue that the HIPs will not add a lot of value to the property purchasing process though.

During October, the property prices fell by 0.7% as the winter has slowed down the buyers’ interest.The vendors were forced to drop their asking prices according to new figures published this week. Leading up to November, the average asking price was reduced by over £1500 in England and Wales. According to Rightmove, the average property prices thus dropped below £240000.

This drop has effectively brought the house prices back to July levels.

Analysts are widely expecting further price reductions before the end of this year and early part of next year. If the financial markets can achieve some stability, the analysts are saying that  small price increases might be possible later in 2008.

However, noone is still expecting a wide recession in the economy; therefore they are ruling out a majot price correction at this stage.

Property in Maidenhead

The Bank of England has signalled potential interest rate cuts for 2008.

This has been welcome by millions of mortgage payers who have been struggling to keep up with escalating interest rates.

The Bank of England has increased the interest rates 5 times over the past 15 months - peaking at 5.75%.

However, there were also some worrying news in the its quarterly Inflation Report. The Bank forecasts the economy would slow down in 2008 and inflation would increase.

The Bank noted a significant amount of uncertainty over for the economy in the upcoming months, particularly due to the vulnerable world financial systems.

The bank also indicated that there were some signs the house price inflation was softening.

The mortgage lending fell again in September in the UK as interest the rate rises slowed the housing market and house prices continued to fall.

According to a recent survey, a total of £30.6 billion was advanced during September. - This is the lowest monthly lending figure since April of this year. The amount lent to first-time-buyers fell sharply to £12.7 billion, down from £16.2 billion in August. They are now spending an average of 20.4% of their income on mortgage interest payments, figures showed.

The increase is part of a trend which began in early summer and reflected interest rate rises in May and July, the Council of Mortgage Lenders said. But the credit crunch, which has led lenders to tighten their belts, has only just started to affect mortgage approval numbers, suggesting interest rates could be increased again in the coming months.

Figures also showed a fall in house prices for the third month in a row. Analysts expect these factors to combine to further cool the property market.

We believe this data suggests that higher interest rates are now beginning to slow down the housing market. However, due to the recent turmoil in the financial markets the mortgage  costs are certainly going to increase.

The Royal Institution of Chartered Surveyors (RICS) claims that the housing market slow-down is becoming more apparent.The RICS UK housing market survey published in November suggests that prices in October fell for the third month consecutively. This is the fastest pace since July of 2005.

Most of the surveyed areas have indicated a slow-down since the summer and London seems to be the only exception.

This is yet the clearest sign of the widely forecasted house market slow-down so far and the recent troubles in the financial sector seems to be a big influence.
A combination of high prices and increased interest rates have finally reined in the housing market, with the unaffordability of homes, relative to average incomes, having risen to record levels.

Appleton Estate Agents Marlow say the enquiries from new buyers also fell, for the 11th month in a row, as other factors came into play.

Estate Agents Marlow

With the buy-to-let investments becoming more popular everyday, more and more people treat their investments like businesses.

As with any other business, the property investment should therefore aim to maximise the income from the rentals. This is a fine-balancing
act of keeping the property in a “desirable” state while ensuring that the vacant period for the property is minimal.

Naturally, it is not easy or realistic to find tenants that stay in the property for years. Currently, the average tenancy period seems to be
around 10-14 months in the South East of England. So, on average, the landlords go through a tenancy renewal once every year.

As a premier estate agent in Maidenhead, to help our valued landlords strike the right balance, Appleton Estates aim to achieve 2 key objectives
for our valued landlords while managing their properties:

1. Our main aim is to secure the next tenancy in advance so that there is either no vacant period or it is kept to a minimum window. Appleton Estates ensures this with our extensive and timely marketing strategy. We not only market the properties the local printed press but also heavily market them on the Internet well in advance so that a new tenancy can be secured as early as possible.
2. Our second goal is to make sure that the property is cleaned to a professional standard by the tenant who is vacating the property. As part of the change-over process we also ensure that the property is prepared for the new tenancy (cleaning, safety check, etc.). While this process may add a few days to the change-over period, it can easily be justified when considering the need for the property to be well-maintained and well-presented in the market place.

We have a network of highly experienced inventory clerks to ensure that the property is well maintained during the tenancy and is ready for the next.

It is also important for the landlords to consider what upgrades they need to keep the property in a desirable state and time the work well over the tenancy change-over. This would be the best time to carry out maintenance work such as replacing the carpets, repainting the interior walls or tiling bathrooms when the property is vacant.

Whilst novice landlords think that having a ‘back-to-back’ tenancy maximises their income, this may actually be counter-productive for the investment. This would cause long term deterioration and reduction of the asset value of the property. As with any business, the property business requires some ongoing investment.

Estate Agents Maidenhead