Property Investment Market Commentary January 2009

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Cash rich property investors love 'doom and gloom'! The less buyers and a bigger choice of properties to buy the better. Many inexperienced investors think that you should wait until the market 'bottoms out' before you buy. But experienced ones know that all you have to do is predict how far prices will fall and then purchase at 'below market value'.

Investors that know what they are doing are able to price properties properly, choose the right type of property in the right street and pursuade the vendor to sell to them at a great discounted price. Ethical investors will be honest and fair with vendors, unscrupulous ones will cheat the vendor out of equity and if they rent back to them will kick them out as soon as they can. Selles beware!

Investments that work in this kind of market are typically long term ones. Renovate or build for profit and buying off plan rarely works in this kind of market, whereas cashflow positive buy to let residential or commercial property can. Buying abroad is still an option for good capital growth, but with the downward pressure on the pound, the cost of buying has gone up dramatically. 

All property investors, particularly novice ones, should beware of property investment and sourcing companies offering properties at 'below market value' and 'no money down deals'. Companies to beware of are ones which insist you use their mortgage lender and conveyancing and particularly those that don't let you see the property. New rules are in place that mean you must make the lender aware of any discounts etc, so you need to make sure you and the company you work with, works on the right side of the law.

For more market commentary on a national or local level:-
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