Property Investment Vs Property Development

Property Development Or Property Investment

Property development and property investment could be classed as one and the same in some quarters - but in reality they are a quite far removed.

Property development is best hightlighted by the televison programs that frequent our screens such as Property Ladder and How To Be A  Property Developer. A residential property is acquired below the market value due its state of disrepair and then developed into something that can be offered for resale or to the Buy to Let or rental market.

Profit is made (or lost) by the developer but time has to be factored into the equation as development is very much hands on and linear. Many individuals that are property developers can only concentrate on one project at a time.

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Property Investment on the other hand is all about the rental market and is completely scalable.

Why Property Investment Is More Profitable That Development

The ideal starting point for a would be or potential property investor would be to research properties in your area - visit local estate agents and ask to be put on their mailing list. Ideally pick a dozen or so properties that will not take up too much of time firstly, to initially view - and secondly to visit should the need arise.

The type of properties to avoid are flats or apartments where you may need to factor in the cost of ground rent or communal maintenance - this monthly cost will come out of your profit.

It is important  to remember that your profit is not based on the potential of your equity rising in years to come but a solid monthly profit from the rental.

Once you have found the formula for success it can repeated over and over again.

Property Investment is by a better option and by far a better use of you time and capital.

Is The Property Market Going To Crash

Property Market - Is It Going To Crash

According to the media the UK property market is free fall - not a day passes without a mention of the current property crisis in the UK. But is the property market in as bad condition as we are lead to believe?

If you are worried about the situation and have been convinced the UK housing market is going to crash like the USA and Spain you are worrying unnecessarily -  There may be some similarities between us, but our (the UK) prices will drop less significantly than those of the USA and Spain.

The reason for this confidence is simple economics and the fact that the demand for housing far exceeds the supply.

This year alone (2008) the UK government has predicted we will only build 100,000 new homes - a quarter of the required amount- before 2009. So until the UK can match this demand, the market is safe.

Why The UK Property Market Will Not Crash

1.    One of the reasons why Spain is struggling is that they are still building more than they require. The number or available properties far exceeds the population. We have got the opposite problem in the UK.

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In 2005, 193,000 new houses were built. This may sound impressive but to make a real impact on the growth of housing prices and reduce their costs, 245,000 new homes need to be built. And we are far from reaching that goal.

2.    In 2000-2006, the uk population increased by approximately 1.7 million this resulted in the need for 800,000 new residential houses. Although 1.1 million were built in this period, these extra 300,000 new houses were insufficient. They could not account for the growth rate of the churn or 2nd home ownership.

3.   When UK inhabitants are looking to move home they do not compare their salary to the price of the house. The big mistake they usually make is to actually compare their income to their annual mortgage payments.

Although, it could be argued that mortgage payments - as a share of a household income - has increased from 15% (2001) to 19.6% in 2005, these figures are still well below the 34% recorded in the last property crisis in 1989.

4.    It is natural to see fluctuations and property activity in certain areas of the country as the economy grows, but some areas struggle to match these demands. Through a combination of a lack of housing and transport, certain locations have become property hot spots to accommodate this need, but cannot expand fast enough.

Stratford in London springs to mind. Read about Property Investment In Stratford

Is Property A Safe Investment

Throughout the last two decades the UK has survived two property crashes and bounced back stronger than before. Experts predict that by 2010 the housing market will be buoyant once again.

If you have any ambition in the property investment marke - no is the time realise your ambitions. Click here for FREE Property Training Seminar

Best Mortgage For Buy To Let

Buy To Let Mortgages

If you just starting out in the property investment market and completely bemused as to which type of mortgage to choose for your buy to let property, there are specific mortgages for Property Investment - i.e. to rent out rather than live in - you will need a buy-to-let (BTL) mortgage.

Buy to Let mortgages are unique and quite different from the mainstream mortgages as, instead of assessing the amount you can borrow from a lender, based on your income, loans are calculated on the rent you could get for the property.

In the past mortgage lenders required a rental coverage that was above that of the mortgage amount, for example 120 % of the monthly repayments. But lately the rules have become more relaxed and you can get a mortgage with rental coverage of 100 per cent in some cases. The credit crunch is seeming to work in favour of the property investor compared to the standard residential mortgage.

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However, it is still usual practice to have to raise a deposit of 10% or more, but more recently the number of No Money Down deals have populated the market.  Traditionally only a small number of specialist lenders offered BTL mortgages but more recently we have seen high street banks start to lend to landlords.

BTL mortgages can normally be either repayment or interest-only loans. Interest-only mortgages mean cheaper monthly payments but the property will not be yours at the end of the term – you will still need to repay the capital amount or sell the property. Repayment mortgages ensure that you repay a bit of the capital and a bit of the interest each month and at the end of the term the debt is fully paid off.

If you have have ambitions in the Property Investment martet and would like to find out more information about Buy-to-Let mortgage option you can register for a Free property Investment Workshop in your area.

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Buy Property To Rent To Students

Investing In Property To Rent Out To Students

If you have ambitions in the property investment market - the student market is currently enjoying massive growth. Even in times of economic troubles the one thing that the UK will never run out of is students and their need to be accommodated.

Year on year more school leavers opt to go to university, meaning more investment opportunities for you.

Buying into property around universities and university town is and will always be a the most sensible property investment you will ever make.

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The Current Student Demand For Accommodation

Fact 1: A high majority of universities can only house or accommodate around a third of its total number of students. Simple mathematics dictates that two thirds of students need somewhere to live for the duration of their courses - ideally within a half mile radius of their university.

Fact 2: Mortgage lenders have reduced the number of mortgages offered by nearly 40%. The number of people who find themselves stuck on the first rung of the property ladder is rising dramatically. This increases the need for rental accommodation.

Fact 3: In the last 4 years, student rent has risen 17% - a £36.16 increase per month. It may sound like a small amount of money, but when when you factor in time imagine what this figure will amount to in 1 year. Approximately £430 free extra profits, based completely on interest and inflation.

Fact 4: Private rental accommodation has risen by over 50% in the last 6 months. Some students especially in and around the London area are now paying an additional £200 more than they were two months ago. with rent set to rise a further 6.3% in the next year - the wise property investor is profiting.

Tenancy For Life - Is It Possible

Can you imagine earning between £500 to £1000 each and every month - for life.

Every year nearly 6 million new students leave school and begin their journey into further education, yet an incredible 70% of this number will have to find rental accommodation - off campus.

The solution to their problem lies with you through Buy To Let

Buy to Let For Students

Property Mentors unique step by step system can teach you how to profit form the student demand for property - the exact same system we use to make our very own investments. You can invest with no previous experience, using little or none of your own cashflow and make instant free equities of over £15,000. It sounds incredibly simple - the risk is minimal and rewards are potentially huge.

As long as there are students there will always be a demand for rental accommodation. More and more 18 year olds are opting to go to university every year, meaning more tenants will be searching for a home to shelter them through the next 3 years of their life. Now is the time capitilise.

All you need is a system to make this goal a reality. Systems such as these are available to everyone - but surprising few fully understand or aware the potential.

The Buy To Let property market is not elitist or for the cash rich compaines or individuals.

In our FREE 2 hour property investment seminar we will introduce you to new, unique strategies seen no where else in the country, that will enable you to receive 100% mortgages, and become financially free after your first 4 properties.

So make your investment dreams happen. Book your free course today …