BBC2 have been showing a series about the housing market called "Property Watch", every weekday, this week, until today (Thursday). If you are interested in how the UK property market works, you need to watch this show. You can see previous episodes on BBC iplayer.
One lady, "Amanda", with 50 buy to let properties experienced difficulty with tenants not paying rent. The banks stopped lending her money, so her properties are now beginning to be repossessed. It highlighted the banks excessive lending, as they lent her 7.5 million. All borrowed money, and she has no cash in the bank to maintain her empire at all. I do not think the banks will again lend so much money, so recklessly, for a long, long, time.
Property investor Andreas Panayiotou predicted the property crash and sold lots of his rental properties. He is now worth about 700 million in cash. He is saying that we have reached the bottom of the market and claims to be about to start buying rental properties again. I disagree with him. He may have predicted the market properly before, but as good as he is, even he cannot predict the future exactly all of the time. I think that the time to buy into property will be December 2012. I remember in 2007 at the beginning of the property crash when Donald Trump said it was the best time to buy property. Trump was wrong. Prices are still dropping, and I see the fall continuing until 2012. If Trump, one of the most successful property investors in the world can be wrong, then so can Panayiotou.
One man "George Vassiliou" bought his London UK council house for about 50k and sold it for 550k, before the property crash. He then purchased a house in Gravesend for about 250k and invested the rest in buy to let property. He says he has had big problems getting the tenants to pay rent, and wishes he had left his money in the bank. He is at least 10k in debt and is in negative equity on all of his BTL properties. Too much borrowed money was his downfall.
Merryn Somerset-Webb, the editor in chief of Money Week was a strong supporter of renting property at the moment, until prices drop even more. She was talking to one potential buyer, who had pulled out of buying a property now for 250k, because she might be able to buy it for 200k in 6 months. Merryn agreed with this, and is living in a rented property herself, even though she can afford to buy a house. I always say expect to pay back twice as much money to the bank as you originally borrow, due to bank interest. In the previous example, taking a mortgage for an extra 50k would mean paying back around an extra 100k to the bank over the life time of the loan. I strongly agree that renting is a good thing as part of a planned strategy. Renting a property is not dead money and is not flushing money down the drain.
The program was very negative about the condition of the property market, but it was good to see the reality of the situation presented, as unpalatable as it may be. I found the program to be well researched and very informative.
The last episode of Property Watch is today at 8pm on BBC2. You can watch all of the episodes on the BBC iplayer.
One lady, "Amanda", with 50 buy to let properties experienced difficulty with tenants not paying rent. The banks stopped lending her money, so her properties are now beginning to be repossessed. It highlighted the banks excessive lending, as they lent her 7.5 million. All borrowed money, and she has no cash in the bank to maintain her empire at all. I do not think the banks will again lend so much money, so recklessly, for a long, long, time.
Property investor Andreas Panayiotou predicted the property crash and sold lots of his rental properties. He is now worth about 700 million in cash. He is saying that we have reached the bottom of the market and claims to be about to start buying rental properties again. I disagree with him. He may have predicted the market properly before, but as good as he is, even he cannot predict the future exactly all of the time. I think that the time to buy into property will be December 2012. I remember in 2007 at the beginning of the property crash when Donald Trump said it was the best time to buy property. Trump was wrong. Prices are still dropping, and I see the fall continuing until 2012. If Trump, one of the most successful property investors in the world can be wrong, then so can Panayiotou.
One man "George Vassiliou" bought his London UK council house for about 50k and sold it for 550k, before the property crash. He then purchased a house in Gravesend for about 250k and invested the rest in buy to let property. He says he has had big problems getting the tenants to pay rent, and wishes he had left his money in the bank. He is at least 10k in debt and is in negative equity on all of his BTL properties. Too much borrowed money was his downfall.
Merryn Somerset-Webb, the editor in chief of Money Week was a strong supporter of renting property at the moment, until prices drop even more. She was talking to one potential buyer, who had pulled out of buying a property now for 250k, because she might be able to buy it for 200k in 6 months. Merryn agreed with this, and is living in a rented property herself, even though she can afford to buy a house. I always say expect to pay back twice as much money to the bank as you originally borrow, due to bank interest. In the previous example, taking a mortgage for an extra 50k would mean paying back around an extra 100k to the bank over the life time of the loan. I strongly agree that renting is a good thing as part of a planned strategy. Renting a property is not dead money and is not flushing money down the drain.
The program was very negative about the condition of the property market, but it was good to see the reality of the situation presented, as unpalatable as it may be. I found the program to be well researched and very informative.
The last episode of Property Watch is today at 8pm on BBC2. You can watch all of the episodes on the BBC iplayer.
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