Property Crowdfunding: Is It The Right Investment For Me?

Property Crowdfunding: Is It The Right Investment For Me?

Property crowdfunding is becoming an ever-more popular way for people to invest in property, often with significantly less money than investing the traditional way. However, before you jump in, it’s a good idea to assess whether this is the right investment choice for you and your circumstances.

You can view our current property investment options here.

What Do You Want To Achieve?

The first question to ask yourself when considering property crowdfunding is what you wish to achieve from your investment.

If you are looking for an investment that requires less ongoing attention than owning a property for either development or rental, or you personally have more faith in the property market than the stock market, then it could be right for you. Nonetheless, plenty of investors in property welcome the sense of control that owning a property outright brings.

Though there is more additional financial outlay involved in the purchase and maintenance of a property owned this way, some people would rather be involved in all aspects of their investment than leave it to another party.

You can find out more by registering here.

What Experience in Property Investment Do You Have?

This follows on to the second question you need to ask. How experienced are you as a property investor?

If you’ve been a full-time, outright property investor for some time, and have access to the bank funding required to own and develop a property yourself, then property crowdfunding may be less appealing.

For those who know how the market works, and perhaps already have all the necessary contacts they need for the properties they invest in, benefitting from more of the profits (after paying off loans), as opposed to their share percentage, may be a more attractive investment option.

If none of this applies to you, then you could be the sort of person who would benefit from property crowdfunding, depending your circumstances.

What Are Your Circumstances?

For novice or less experienced investors, or those who have less access to bank funding, then property crowdfunding can offer an opportunity to invest in property that is unavailable through other means. For those who are interested in the prospect of weathering the risks of property investment, rather than earning scarcely any interest on their savings accounts, again, property crowdfunding may offer an alternative path.

Whenever you consider an investment, whichever form this may take, you need to ensure that you are covered in the event that the investment takes a turn for the worst. You should only ever invest what you can afford, so make sure your calculations are correct, and you won’t cause yourself financial harm if, for any reason, the value of your investment falls.

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To Conclude

As a final note, if you decide to invest in property crowdfunding, there is further investigation to be undertaken. You will need to choose the right crowdfunding platform. It is very important to do your research, and to only settle on the platform that meets all your needs and requirements. Make sure they are regulated by the FCA, that they have a good reputation, and that their customer service and complaints procedures meet your standards.

View our Property Investments

Entrusting your money with any investment vehicle is a decision that should never be made lightly. Ensuring that you are confident with all aspects of the investment is crucial, including the issue of risk. Property crowdfunding is no different to most other investment types, in that there is always a risk of loss. Knowing everything you can, and choosing the right investment for you, is the key to investing happily, smartly, and – hopefully – profitably.

 

Our Track Record For Rental Properties

Our Assured Rental Portfolio: Statistics For The Last 12 Months

The House Crowd started off in March 2012 buying small terraced houses for around £50,000. As our database grew, it became easier to raise funds and the company has evolved to financing multi-million-pound developments; however, the familiarity of the original buy to let concept, is still popular with many of our developers.

We found during our first four years that renting at the low end of the market is met with some difficulties. Despite our best intentions to provide good quality homes for people, with the expectation they would respect and look after the property, in too many cases (around 20%) non-payment of rent and damage to the property, were undermining the returns we could pay. Our plan was to find a way to satisfy the demand for this type of property, whilst delivering predictable and consistent returns for our investors.

And, I am pleased to say that we found a solution that has proven to work very well in delivering both exceptionally high gross yields and net returns.

That solution is our Assured Rental Product.

We launched our first one in January 2016 and over the course of 2016 purchased 16 more. They have all performed exactly as detailed in our financial forecasts for each project and delivered an average of 9.2% gross yield and 5.6% net return to investors after all costs, fees and corporation tax. This should make it ideal for those who want a long-term, income-producing investment backed by bricks and mortar.

The only real disadvantage to these investments is that the criteria of the corporate tenant we work can be very precise. It is time-consuming to find and convert properties according to their specifications and therefore we pay a premium for that.

The properties are treated and valued by surveyors as commercial properties. This means to achieve an uplift on a sale in the future, it will probably be necessary to sell the property to an investor, which undoubtedly limits the exit market; however, we believe high yielding properties with assured rental agreements in place will be attractive to many prospective investor purchasers.

Click here for a detailed financial summary of all properties purchased to date

For those not familiar with the assured rental product, here are the important facts:

  • The properties are let as HMOs to a large corporation on a five-year assured rental agreement
  • The corporate tenant is responsible for all maintenance costs up to £5000 per year
  • There are no void periods
  • Rent is paid two months in arrears but to date has been paid on time every time
  • The properties produce a gross yield of 9-10%
  • The average net yield is 8.5%
  • The average net return to investors after all costs is 5.6%
  • Dividends are paid quarterly
  • All properties purchased to date have delivered returns as forecast

2017 Property Market Forecast

Is Buy to Let Dead?

The buy to let market in the UK really gained traction in 1996, with the opening of the mortgage market. This made property investment accessible to millions who had been previously prevented from seeking better returns through property, as opposed to the pitiful rates provided by their institutional pensions.

It proved immensely popular, and many people found the idea of property as a way to provide a retirement income preferable to putting their money in a traditional pension. However, over the last two years, these people have been ruthlessly stabbed in the back by the government who have crippled the ability of small landlords to make any sort of profit.

Not only has there been an increasing amount of red tape and financial burden placed upon landlords in recent years, but George Osbourne saw fit to increase stamp duty and, in an astonishingly cynical move, he decreed that landlords should be treated differently than every other type of UK business and would not be able to offset loan interest payments against revenue.

What this means for the large majority of landlords who have mortgages and do not operate under a limited company structure, is that they will incur heavy losses and could potentially be forced into bankruptcy, as their increased tax bill exceeds their rental income. What’s worse is that research indicates only a small percentage of landlords are aware of this cataclysmic change and the effect it will have.

It seems clear to me that the traditional way of investing in buy to let property that has thrived over the last 20 years is, as far as most people are concerned, no longer an option. Property, however, is destined to remain the nation’s favourite asset class but the types of property, and the way people invest in it need to change.

We, at The House Crowd, find the Government’s attack on, and lack of concern for small landlords, utterly reprehensible, but fortunately, we are in a position to help. Crowdfunding and peer to peer secured lending, have emerged as very popular ways people can build their wealth through property. Given the legal and tax changes, they now seem set to replace traditional buy to let as the best and perhaps the only way, ordinary investors can still benefit from direct property investment.

If you want a longer-term investment, secured with the ownership of real bricks and mortar, we have a steady stream of properties with assured rental – thus removing many of the risks and variables associated with property investment. These properties also produce a very decent return – a gross yield of 9.5% which should produce a net return to investors of at least 5.5% after all fees and costs. Investors will also benefit from any capital growth on sale.

So whilst buy to let may not be completely dead, it will really only be viable, after April 2017, when the tax changes take effect, via a company structure and payment of large deposits or through crowdfunding platforms.

What Will Replace Buy to Let?

Buy to let may have been killed off but the PRS (Private Rental Sector) has grown apace over the last few years, with property funds and other institutional investors pouring money into the sector. PRS, for those unfamiliar with the term, generally refers to purpose built blocks owned by institutions – generally with a high standard of communal facilities designed to attract and keep tenants long term.

The government is also now throwing its support behind PRS and the build-to-rent sector with large urban developments being financed by institutional funds and managed by large companies to cater for Generation Rent. For example, the government has announced that £45 million of its new £3 billion Home Building Fund will go towards kick-starting a deal involving 2,000 new build-to-rent homes. This includes 995 new purpose built units in Manchester, currently the city with the UK’s highest yields. Combined with the recent attacks on buy to let, it is likely that this will consolidate build-to-rent as the future of rented living and property investment in Britain.

Given the scale of the developments, and the money required to finance them, it is clearly not something readily accessible to individual investors. And, here again, is where crowdfunding comes into its own.

The House Crowd is ideally placed to help those people who are seeking a lower risk, longer term investment with build-to-rent. We are currently financing the building of over 100 units in the Manchester area and, whilst most have been built to sell, we will be introducing build-to-rent developments shortly with the intention of providing our investors with the ability to earn a steady annual return with the upside of long-term capital growth. Being a part owner of larger developments will also help mitigate risk.

We are, in effect, giving the individual investor, the opportunity to benefit from the growth of the build-to-rent sector and earn returns on par with institutional investors.

Best Places to Invest In 2017

It will come as no surprise to learn that I think Greater Manchester is the best place to invest, and I am not the only one, as many pieces of research forecast the same.

It’s not difficult to see why – Manchester offers the ideal combination of high yields and decent capital growth, something that London cannot. Predictions are that rents will increase by 5% in 2017, with capital appreciation to reach 4-5%.

The city has benefited from successive governments’ attempts to invest more money outside of London. Thousands of overseas students now come to Manchester each year, and it has fast established itself as an international talent pool with a booming rental population.

Manchester’s reputation as a property hotspot was recently reaffirmed by research from Lambert Smith Hampton, which revealed that 68% of property investors see it as the best place to invest.

I also see Stockport, in Greater Manchester, as a particularly strong area and think it should be at the top of the list for any investor hoping to achieve strong, consistent returns through property. Seven miles south-east of Manchester city centre and eight miles from Manchester Airport, the commuter town boasts direct rail services to Manchester, Liverpool, Birmingham and London. With a £42 million transport interchange under construction and £1 billion being invested across retail, residential and commercial sectors over the next five years, Stockport is establishing itself as a regional business hub.

Over the past year, property prices in Stockport have increased by 15.9%, and 1,100 new homes will be built over the next five years to cope with increasing demand. Properties in the area offer investors strong, consistent yields – a safer bet than relying on speculative capital growth.

http://www.manchestereveningnews.co.uk/news/local-news/timetable-1bn-regeneration-stockport-revealed-12292326

Reasons to Invest With The House Crowd in 2017

  • Specialists in Greater Manchester property – forecast by many experts to be the best area to invest
  • We offer traditional high yielding properties with assured rental
  • With over 100 new build properties either completed or in development, we are committed (in our own small way) to helping build the houses Britain needs
  • We are ideally placed to capitalise on both build to sell and the build to rent sector – which, backed by the government, is believed to be the future of the rental market
  • We enable access to individuals to participate in large scale developments investments with security and returns on par with those institutional funds receive
  • Choice: we offer
    • Short-term fixed-rate debt investments for those who want high returns and liquidity,
    • Longer term equity investments where investors share in both income and capital growth
  • No borrowing on property purchases means lower level of risk and less vulnerability to fluctuations in interest rates
  • Crowdfunding provides perhaps the only viable option for most people to continue to invest in property

View our Property Investments

The UK Housing Crisis: Supply and Demand

The UK Housing Crisis: Supply and Demand

2016 has been full of shaky times for the UK property market. However, there have been no actual signs of prices dropping, despite the Brexit naysayers’ warnings. Negative headlines about the UK housing crisis are still milling about, but there is one aspect of the property market in particular which is promising to keep the market afloat. That aspect is the continuing lack of supply.

The lack of properties for sale has helped to support the market, and to push prices higher. That’s before we even take the undersupply of newbuilds into consideration. This undersupply has been going on for decades, whilst successive governments have sought to garner good feeling among voters with artificial support of property prices. There is no end to this situation in sight at the moment.

There was a small fall in prices after the Brexit vote, reigniting hysteria over the UK housing crisis. Nonetheless, the UK continues to be a popular target for overseas investors, indeed, there was a surge in overseas interest following the referendum result. Indeed, looking at the state of the pound at present, it’s clear as to why we are gaining attention from overseas.

Along with the lack of supply, we are seeing a growing state of pent-up demand for property in the UK. A scarcity of properties, combined with high competition between buyers, is a recipe for further property price inflation. This, too, will affect the rental market, as more households find themselves priced out of the purchase market than is already the case.

UK Housing Crisis Affects Rental Market

Higher demand for rental accommodation, combined with a reluctance of investors to approach buy-to-let following the stamp duty hikes and other attacks on landlords in 2016, may push rent higher. Great news for investors, and build-to-let in particular; not such good news for tenants – those who feel the brunt of the UK housing crisis hardest.

The answer is new builds. However, we are struggling to meet demand in this area too. Currently, 200,000 new properties are required per year, and we are still falling desperately short of that. The population is growing, and everybody needs to live somewhere. Something, clearly, has got to give.

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Could Property Crowdfunding Help the UK Housing Crisis?

Property crowdfunding may offer a partial solution to this conundrum. Pooled funds being pumped into development of properties, particularly in areas like the in-demand North West, alleviates the buy-to-let problems that outright-ownership landlords are facing, as everything is managed through the SPV (Special Purpose Vehicle) in which the shareholders’ funds are invested.

Though property prices and rent will not be directly lowered by these developments, it may alleviate a small portion of the supply shortage. After all, every little helps.

View our Property Investments

Government Promises Investment in UK Property Development

Good News as Government Promises Heavy Investment in UK Property Development

The UK Government has recently announced plans to invest billions of pounds into the creation of new residential UK property development.

UK Property Finance, one of the UK’s leading Development Finance firms, is understandably excited by the news:

“With the Treasury itself providing serious financial support for those in the property development sector,” they state. “It seems that the disconcerting issue of the lack of affordable housing across the UK is finally being taken seriously by those in power.”

The investment plan is expected to assist in the creation of 225,000 new homes across the country, with at least 15,000 anticipated to be ready and habitable by 2020. There’ll be, it seems, a £3bn injection to the Home Builders’ fund, with a further £2bn going directly to residential property developments on public land.

Insufficient Funds for UK Property Development?

However, despite this news, there are plenty of voices in the property development sector who don’t believe the figures to be sufficient to overcome the extent of the housing crisis.

“Although the amount of suggested investment is significant,” UK Property Finance goes on to say. “It still seems to fall short.”

Whilst these steps by the Government are, of course, a step in the right direction, the extent of development simply does not match the volume of population expansion. This is particularly the case for affordable housing, as increasing numbers of people are priced out of the property purchase market altogether.

Without sufficient Government backing, some affordable financial backing tailored to the needs of each development is necessary.

Enter Property Crowdfunding!

Property crowdfunding and peer-to-peer secured lending may just be the answer. Allowing investors to build a diverse portfolio of property investments across a range of property types, as well as smaller financial input requirements, the alternative finance sector is promising. A more diverse variety of investors, from high net worth to private individuals can get together to fund development projects that will help towards providing some of that much needed new housing stock.

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Despite numerous setbacks, from Brexit to tightening on mortgage lending, the UK property market seems to be remaining buoyant, with optimistic reports for the future.

The property crowdfunding and peer-to-peer secured lending market is one of the major players making a significant difference in keeping the property market moving in the UK. It’s this kind of innovation, as well as the perseverance in the face of challenging times, that is key to building a successful future for the UK property market, and the economy at large.

View our Property Investments

The Future of Property Demand in the UK

Sheree Foy, founder of Source Harrogate, has told the Yorkshire Post her predictions for the future of property demand in the UK.

Firstly, she dismissed ideas that Brexit will have a long term effect. On the supply side, she says, not a great deal will change. Demand, however, may be affected. Growth forecasts show reductions over the next two years, and there are rumours amongst financial analysts of a 50-50 chance of recession.

Along with base rate reductions by the Bank of England to a record low of 0.25%, cheaper mortgage rates, and the prospect of further interest rate plummets, property demand may be a bigger issue.

But Foy is less interested in these matters, looking to the longer term.

So what are the big issues around property demand in coming decades?


Property Demand by Demographics

Over the next ten years, we will see a significant rise in the over 65 age group, combined with a dramatic rise in over 85s. One in five people in the UK right now will live to see their 100th birthday, according to the Department of Work and Pensions.

From this, Foy predicts a rise in property demand for bungalows, and other homes suitable for later life living. Foy labels these properties as “rare asset[s] with a guaranteed increase in demand” – and notes that those who plan ahead with their investments to meet this upcoming property demand are set to reap rewards.

Homes with smaller gardens, close to towns, with adapted kitchens and bathrooms, are all winners.

View our Property Investments

Property Demand by Location

Over the last ten years, farming has become increasingly more automated, leading to an inward flow to towns, which are more attractive than ever.

On the other hand, public transport is becoming less available, with journey times taking longer and longer. Without a drastic overhaul of the public transport network, property demand in cities and towns could continue to rise.

Nonetheless, Foy is banking on a return to the country facilitated by technology. Better broadband connections and speeds are making home working an increasingly available option for many, whilst the predicted adoption of driverless cars in coming years will also relieve much of the strain of commuting. With this eventuality on the horizon, country living could equally be set to rise in popularity.

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Property Demand By Energy

As we move further away from dependence on huge power stations in favour of multiple source and sustainable energy sources, EPCs (Energy Performance Certificates) are set to become crucially important to the desirability of a property.

More locally generated power, from solar powers to wind turbines, are growing in use in domestic settings. Homes with adverse EPCs, Foy states, just aren’t selling like they used to.

To increase the desirability of your property, Foy recommends staying on top of energy efficiency in the home. Replace old boilers, insulate walls and roof spaces, double/triple glaze those windows, and look into home power generation options.

 


Planning ahead for future property demand is a key factor to take into account when investing in property. Choose your weapons wisely, and build a portfolio that will stand the test of time.


 

Property News Round-up 20/4/16

Property News All The Latest Updates

Hi guys and welcome to another fortnightly property news round-up, today we once again take a look at the latest goings-on in UK property from looking at why Manchester is a city for Generation Y to looking at how commuters can save £3,000. If you missed our previous property round-up, catch up here.

 

Manchester Is A Generation Y City

Manchester

Manchester is rapidly becoming a place where young people migrate to for work and also to study. 22% of the city’s population are Millennials (aka Generation Y), which is more than four times the national average.

Due to an increase in young people, there is now an emphasis for build to rent property investment in Manchester. So what exactly is attracting Generation Y to live in the city?

According to the Complete University Guide, “Manchester is a thriving, prosperous northern hub and considers itself the commercial and cultural capital of the north of England. The city is also probably the most fashionable student location in Britain.” (Select Property Group, April 2016)

Manchester is also known for its universities and is synonymous with higher education. Moreover, over 50% of graduates stay in the city and around 20,000 are enter the job market in Manchester each year. Since Manchester is the country’s second largest economy, Manchester is one of the biggest regional employers.

In addition, with thousands of graduates looking for work, they also need to somewhere to stay and the city attracts Generation Y as accommodation costs are significantly lower compared with London prices. Latest figures from the Expatistan Cost of Living Index show that everyday amenities in the north-west are 37% cheaper than inside the M25.

A graduate living in Manchester would pay around £700-800 a month for rent, in the capital, they would pay over three times the amount for a rented property.

Millennial’s fast paced lifestyle and the need for everything in an instant makes the likes of buy to rent a perfect solution in the city. This also makes the city a great place to invest, not only because of its large millennial population but also being at the forefront of the Northern Powerhouse.

Want to know more about the city? If so, why not check out our free guides (North and Central).

 

Housing Market ‘To Cool’ As BTL Rush Dies & Brexit worries Increase

UK Property

The UK’s housing market is set for a slowdown as the buy-to-let rush of the first three months of the year dies away, according to the Royal Institution of Chartered Surveyors. (Telegraph, April, 2016)

A lot of confidence with regards to the UK property market has fallen due to uncertainties that surround the Brexit vote, stamp duty charges, a weaker pound, plus the devolved elections in May.

Despite these political uncertainties, in the long term, the imbalance between demand and supply will still exert a strong influence on the market, with house prices expected to rise by close to 25pc over the next five years as Simon Rubinsohn (chief economist at Rics) mentions in a recent Telegraph article.

Halifax recently reported that confidence in the housing market was at its lowest in more than a year and its housing market confidence tracker indicates that 65% of the general public believe that the average UK property prices will be higher rather than lower in 12 months’ time.

 

Railway Stations ‘Will Deliver Thousands Of Jobs & Homes’

Railway Stations UK

 

Thousands of jobs and homes are set to be created on what has been dubbed “the biggest programme of rail improvements since the Victorian age”, the government has stated.

Up to 10,000 new homes could be built across the country as part of new railway development scheme. York, Taunton and Swindon councils have already looked at proposed sites that could used for new builds.

Communities Secretary Greg Clark recently mentioned that : “With record numbers of people travelling by train, it makes sense to bring people closer to stations and develop sites that have space for thousands of new homes and offices.” (Yorkshire Post, April 2016)

He also mentioned that railway stations are hub for local communities, connectivity, and commerce and we should be making the most out of their unique potential to attract investment.

 

More Affordable Homes Needed According To Manchester Businesses

House Buyers UK

From millennials in Manchester to looking at local business views on property.

A recent survey which was conducted by Housing The Powerhouse revealed that the majority of Greater Manchester businesses see building more family and affordable homes as a priority.

Greater Manchester Chamber of Commerce’s Steve Burne told Manchester Evening News that : “Over the past few weeks we’ve seen concerns raised about transport links for the Northern Powerhouse – but the provision of suitable housing is equally as important.”

He stressed that the city is witnessing a boom in business across the city but a focus is needed on providing homes for families. The northern powerhouse needs to cater for families otherwise there will be a major set-back and could see this workforce disappearing down the M56, M6 and M62.

Matthew Good of the Home Builders Federation and member of the Housing the Powerhouse coalition told MEN : “These results show us that the provision of family and affordable housing in the region is already a real issue for businesses.”

The survey results have an eye-opener, and a result, as Matthew explains, the likes of the Housing the Powerhouse coalition are making the case for local councils to take this once in a generation opportunity to set ambitious targets for the mix of homes that the engine room of the Northern Powerhouse desperately needs.

 

Commuters Save £3,000 On Property Each Minute They Are Further Out Of London

UK Trains

House prices in the London commuter belt fall by more than £3,000 for every minute further away the property is by train from the capital, research has found. (The Guardian, April 2016)

Savills conducted research property prices around 314 stations in places surrounding the capital on direct commuter lines into the city.

They found that average property prices within half an hour’s train ride from the capital were £458,000, compared with £606,000 in inner London.

Moreover, Land Registry data revealed the cost of housing fell sharply to £337,000 for journeys of one hour to 69 minutes, with the saving averaging £3,048 per minute!

However, the research also show that the correlation between distance and price is uneven. For example, an average property in Oxford costs £730,000 for a 57-minute commute. In contrast, an average property in Welwyn Garden City costs 430,000 and takes 21 minutes to reach the capital by train.

Families moving to areas outside of the capital have had to factor in journey times, house prices, quality of life and the high cost of commuting in and out of London, Sophie Chick, who led the research for Savills said savings on house prices usually outweighed the increased travel costs. Read more on the story here.

Image source : The Guardian

 

What Are Your Thoughts?

Which of our chosen property stories has interested you the most? We would love to hear from you, feel free to leave us a comment on our Facebook and Google Plus pages. If you prefer to tweet us, tweet @TheHouseCrowd.

In the meantime if you want to know more about Property Crowdfunding do register for our Information Pack which will tell you all about it. 

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Property News Round-up 9/3/16

Property News Round-up 9/3/16

 

Hi guys and welcome to another fortnightly edition of our property news round-up. As usual we will be looking at the latest goings-on in the domestic property market from looking at various house prices around the country to the sobering prospect of Brits having to face on average a three year wait before they can afford a property. If you missed our last property round-up, feel free to catch up here.

Average London Home Is Worth Nearly Triple Those Across England & Wales

 

London Property

New figures reveal the change in house prices over the past year and highlight the regions with the fastest growth in Britain. (Homes and Property, February 2016).

It was revealed that house prices in the capital have risen by nearly 14% with the average house worth three times that of houses in the rest of the country.

In other parts of England and wales, an average property price is around £192,000, in contrast, in London, the average cost will set you back over £530,000.

According to the Land registry, London and the South East have performed strongly with capital figures at 13.9 per cent and 10.7 per cent for the South East respectively.

In addition, the South West prices rose 6.2 per cent this year, cities such as Bristol saw house prices rise to over £220,000.

Moving onto the north, the North East showed the smallest price increase of just 0.2 per cent, cities such as Sunderland fell by 3.2 per cent.

However, on Tyneside, Newcastle had the highest monthly price rise in the north east, with an increase in January of 2.1 per cent to just over £123,000.

In the North West prices grew by 2.1 per cent, Manchester once again showing signs of buoyant growth at 5.6 per cent.

 

Study Shows Third Of £1m-Plus Homes Paid For In Cash Since 2011

Expensive Homes UK

According to research, about a third of homes sold for £1m or more in the UK have been paid for in just cash in the last five years.

Cash buyers have spent more than £63bn in total on £1m-plus homes in England and Wales since 2011, spending on average £1.75m for a property. (Guardian, March 2016).

The research comes after a report from a high street lender predicted that the number of properties in the UK worth £1m or more would more than triple by 2030. Currently, less than 500,000 homes across the country are valued at £1m plus.

The house price analysis which was conducted by Bower Private Clients (BPC) also found out that almost two-thirds of cash buyers bought in London where the average spend per property hit £1.89m, but southern and eastern England also saw high numbers of cash buyers for £1m-plus homes.

Moreover, the Essex based company revealed that their research showed that in London, 22,852 properties costing £1m-plus have been bought for cash since 2011, and 7,864 elsewhere in the South-East. Heading north, there were 641 properties that were priced at £1m-plus and 239 in Yorkshire and Humberside respectively.

Property Investment Is Growing At A Greater Rate In The North East Than Anywhere Else In The UK

North East Investment

Investment in property is growing at a greater rate in the North East than anywhere else in the UK, with investors snapping up more than £1bn worth of commercial property in the last year. (Chronicle Live, February, 2016).

Commercial property experts CoStar revealed that investment volumes within the North East grew by 32% – the largest percentage increase of any UK region.

Gavin Black, chairman of the G9 Group of chartered surveyors told Chronicle Live the North East 2015 total of £1.06bn was almost double the £524m annual average over the last eight years.

He went onto to say that by any judgement this is impressive and that investors are increasingly searching beyond the capital for value and within the North East there is good value as well as asset management opportunities. Investors are always keeping a close eye out on lucrative deals in the region.

 

Property Sales In Scotland Up 4% In 2015

East Renfrewshire Property

We now leave the North East and travel to the north of the border to look at the Scottish property market.

A new analysis report points out that residential sales in Scotland increased by 4% in 2015, which were well below the 11% recorded in the previous year.

The report which was conducted by Savills indicates that tougher mortgage lending conditions during the first half of 2015 impacted the recovery of Scotland’s housing market, but the property market adjusted during the second half of the year due to a recovery in mortgage lending for house purchases across Scotland, which increased by 9% from 59,500 in 2014 to 64,800 in 2015. (Property Wire, March 2015)

East Renfrewshire (pictured) witnessed the strongest annual growth in the number of transactions during 2015 at 13% due to the good schools effect. Glasgow, West Dunbartonshire and West Lothian also performed well and experienced high transactional growth during 2015.

The number of transactions at £1 million and above reached its highest level since 2008. Savills report showed that Prime markets in suburban and commuter areas across the country’s Central Belt performed strongly last year, with growth spreading out from core urban hotspots.

Faisal Choudhry, director of Savills Scottish Research mentioned in Property Wire that the upturn in demand is driving an improving development land market. Sentiment for development land in Scotland’s cities remains a positive one.

Are you interested in Scottish property investment? If so why not visit our property investment in Scotland page.

 

Brits Face Waiting An Average Of THREE YEARS Before Buying First Home

House Buyers UK

A sobering thought… BRITS have to wait an average of three years before they can afford their first home, according to new research. (Express, March, 2016)

The biggest barriers involved include high prices, saving for a deposit and other costs associated with buying or moving house.

Recent research shows that one in two people want to buy their first home or move up the property ladder.

Moreover, six in 10 say they will have to wait 12 months, while 21 per cent worry they may never afford to buy or move home.

Price comparison site GoCompare found out that those who were thinking of buying or moving home have been doing so for an average of 3.2 years.

The sheer lack of availability in the area they want to live, job insecurity and the costs such as mortgage payments, as well as bills have been the main barriers for people. Also, saving for a deposit has been a huge hurdle for many.

GoCompare’s product development manager Matt Sanders told The Express : “Affordability is a big concern for both first-time buyers and those wishing to move-up the property ladder. House prices are increasing due to rising demand and lack of supply. (Express, March 2016)

He also mentioned that with house price inflation exceeding wage growth it’s even tougher to save enough money for a deposit – as a result has potentially put homeownership out of reach for many people.

Are you looking for an alternative and an accessible way into the property market and are thinking about getting involved in property crowdfunding? If so, why not take a look at our Property crowd funding- how it works page for more info.

 

What Are Your Thoughts?

Which of our chosen property stories has interested you the most? We would love to hear from you, feel free to leave us a comment on our Facebook and Google Plus pages. If you prefer to tweet us, tweet @TheHouseCrowd.

In the meantime if you want to know more about Property Crowdfunding do register for our Information Pack which will tell you all about it. 

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Property values can fall. Your capital may be at risk & returns may vary. Read our Risk Warning

What Tax Benefits Are Available From Investing In Property?

Recent announcements relating to changes in Stamp Duty and how tax is calculated on rental properties have been anything but encouraging for landlords and anyone thinking of investing in property.

However, what tax breaks exist for property owners. Continue reading “What Tax Benefits Are Available From Investing In Property?”

Property News Round-up 13/1/16

Property News  All The Latest Updates

Hi guys and welcome to our first property news blog post of the year! The new year hasn’t started well with stock markets coming under severe pressure with the FTSE 100 being down by 5% (its worst start since the new millennium!). In addition, many analysts have predicted more doom and gloom this year (which we will cover in our first story). In China, this year is the year of the Monkey, and we certainly need people who have a huge amount of intelligence and wit (to help us feel a bit more cheery ahead of hard times), both intelligence and wit are associated with people who are born in that Chinese Zodiac year!

 

A Brief Insight Into The Property Market in 2016

property 2016

In this country we always talk about property prices, however, this year there will be more to talk about the likes of stamp duty and landlords.

One thing that will happen in both England and Wales will be an increase in stamp duty – from April 2016, those who are seeking to buy a second home will have to pay a 3% surcharge on each stamp duty band.

The ramifications will therefore make things more expensive for second home buyers and also put off other potential buyers.

In addition, it will not only be second home buyers who will be having a tough time in 2016, buy-to-let landlords will also see their stamp duty rise and will also lose some of their tax privileges (which is already in the pipeline for next year).

As the BBC put it (in my opinion I think they are spot on) mention that who would have guessed that a Conservative government would take a dim view of buy-to-let landlords, just the sort of people supposed to be staunch Tory voters?

The irony is that what exactly has happened as we discovered in George Osbourne’s Autumn Statement.

Regulations such as the illegal immigrant regulation will give landlords even more nightmares (this regulation come into play on the 1st February), they will have to check that their tenants have the right to rent in the UK, if not, they face a £3,000 fine.

One analyst predicts that the first few months will be bumpy as some people will rush to purchase buy-to-let properties before higher stamp duty rates take effect. He also mentions that we will see some quite strong growth in prices, and expects to see prices fall for the next few months as that element of demand is taken out of the market. (BBC, January, 2016)

 

Salford Tops Property Sales In 2015

Salford property

Salford topped the property sales leader board in 2015, a report which was compiled by Halifax, found that the number of property sales taking place in Salford has jumped by 23% this year compared with 2014, also Pontefract in West Yorkshire was ranked second with 20% of property sales.

The report indicated that many towns across Northern England, the Midlands and Wales saw house sale numbers increase, in contrast, the South saw many of the biggest falls in sales.

Below shows the proportions of property hotspots in regions across England and Wales according to Halifax’s research (stats taken from BT) :

  • North 38%
  • Yorkshire and the Humber 26%
  • North West 29%
  • East Midlands 2%
  • West Midlands 20%
  • East Anglia 4%
  • Wales 39%
  • South West 16%
  • South East 15%
  • Greater London 6%

 

Downsizing For One In Three Over-55s Are Dashed Because Of Lack Of Suitable Housing

downsizing property

One in three homeowners over-55 want to downsize but are being prevented by a lack of suitable housing, a report has warned. (Daily Mail, January, 2016)

Researchers found that over-55s hoped to move because smaller homes were easier to manage or because they wanted to release equity to boost savings or pension pots.

International Longevity Centre and retirement housing specialists McCarthy & Stone‘s ‘Generation Stuck’ report revealed that a third of over-55s were actively considering downsizing or expecting to do so in future.

Last year, the Financial Conduct Authority’s mortgage sector manager Lynda Blackwell said Britain had ‘a real problem with the last time buyer’ the Daily Mail mention.

What was particularly interesting to find out was that older people from the UK are among the least likely to move in the Western world. Figures from five years ago show that just 1 per cent of people aged 60 and over moved into retirement housing, compared with 17 per cent in The States and 13 per cent in Australia and New Zealand.

If you fit this age bracket and are looking for an alternative way to invest in property we recommend reading our case study section.

Image Source : Daily Mail

England’s 5,000 Biggest Landowners Are Being Asked To Free Up Land For Affordable Housing

housing crisis

The owners of 5,000 of the country’s largest rural estates hold the key to creating employment, economic growth and housing in areas of the country that are experiencing population decline, according to a recommendation from The Royal Institution of Chartered Surveyors (Rics). (Telegraph, December, 2015)

The call came as figures show that house prices increased at a rapid rate last month, and many have had concerns  that a shortfall of new homes could push the growth in prices higher.

According to Sir Peter Erskine, who has built 22 affordable homes on his family’s Cambo estate in the East of Fife, Scotland, “the big estates are the solution to the depopulation of rural communities”. (Telegraph, December, 2015)

The area near to where his estate is situated has already lost a green grocer and post office, plus the local school has seen a decline in pupils. It clearly shows as Rics‘ head of policy, Jeremy Blackburn mentions that by adding Small amounts of affordable housing can make a huge difference to the viability of rural communities, building just ten units in 1,600 small and market towns in rural areas of the country would solve this rural housing crisis.

Sir Peter Erskine revealed that from experience landowners have dealt with an increasingly hostile political atmosphere and also been held back by high taxes but are willing to create opportunities to effect positive social change in their areas.

Image Source : Telegraph

Northern Property Hotspots For 2016

liverpool property

Last year Rightmove reported that the price tag for a house in London could rocket to an average of £1 million and this is largely down to high demand, cheap mortgages and a lack of accessible homes in the capital.

Investors are therefore heading north as many have discovered that reduce the amount they pay under the new stamp duty rates by purchasing lower entry level properties in northern areas.

Due to the rise of the Northern Powerhouse and having a very good entry level for investors, the north has rapidly become a very attractive place for those wishing to extend their property portfolios.

In addition, investing in student property have also been on the rise in the north, however, as Economic Voice mention, a recent study that sampled 2,000 UK adults by the specialist property company Experience Invest found that only 17 per cent of respondents said they’re aware that investing in student property can result in a high yield.

So what cities are leading the way in the north? Starting with Liverpool, the Merseyside city offers some of the highest returns in the UK due to being a place that has a high yield when it comes to rental income. With a big student population, Liverpool is an ideal place for property investors.

Manchester has always been another popular choice with investors and is arguably the best place in the North to invest due to being centred around the Northern Powerhouse concept. East and North Manchester have good rental yields and good low price properties. With this being such a vibrant and large city – properties can vary from back to back semis to modern city centre apartments. (Economic Voice, January 2016)

Moving our attention to Tyneside, Newcastle is another favourable place for returns. In some areas, there has even been a 50 per cent rise in rental values due to the massive cultural and business rejuvenation throughout the city. Just like Liverpool and Manchester, it also has a thriving student population which makes it another option for investors who are looking to head north.

Yorkshire cities such as Sheffield and Leeds both have an expanding population and the stamp duty is staggeringly low compared with London. Since both have an industrial past, the likes of warehouses and converted modern apartments are being snapped up.

Do you have an interest in the North? If you would like more information, feel free to take a look at our Manchester guides (North and Central), our Liverpool guide and also our South Yorkshire guide.

What Are Your Thoughts?

Which of our chosen property stories has interested you the most? We would love to hear from you, feel free to leave us a comment on our Facebook and Google Plus pages. If you prefer to tweet us, tweet @TheHouseCrowd.

In the meantime if you want to know more about Property Crowdfunding do register for our Information Pack which will tell you all about it. 

Register Now For More Information

 

Property values can fall. Your capital may be at risk & returns may vary. Read our Risk Warning