First Time House Buyers Continue To Be Forced Out Of The Market By “Accidental Landlords”

While the house market is depressed the same can’t be said for Buy to Lets. Estate agents are finding that today, while buyers with anything less than perfect credit histories struggle to get loans and mortgages speculators and housing associations are buying up cheap properties in order to rent them out.

Buyers who are having difficulties getting a foot on the housing ladder are being edged out by investors who have the available funds to purchase property without a chain when it becomes available and then letting it out to the rental market.

As housing charity Shelter recently unearthed, almost a ten percent of Britons have taken short term, high interest payday loans, bank loans and overdrafts to pay for their rent or mortgage. When people are so short of funds it’s not surprising that the volumes of people trying to buy is at an all time low. The sluggishness of the market is only helped by banks’ refusal to lend money to private buyers meaning that there is only share among cash rich landlords and associations. Some estate managementanalysts feel this is one of the most telling factors affecting the housing market today.

The numbers, not only of rental properties, but of private landlords who’ve been able to invest in property is growing because banks are more favourable to lending to buy-to-let than they are to private buyers, in the last quarter of 2011 they lent £3.8 billion in buy-to-let loans and mortgages.

But it’s not just the British who are enjoying the benefits of the buy to let market’s growth, many foreign investors, particularly those in economies which have been largely unaffected by the economic downturn, have been buying up investment properties which include both private and commercial property to let. These ‘accidental landlords’ are purchasing investment portfolios without much concern for what they actually contain, they are simply buying with a view to making money, once they see a return on their investment, either through rents paid or the recovery of the house price, they will sell again. Meaning that, again, the property will only be sold once it is too expensive for a first time buyer to afford.

Another factor for accidental landlords who never wanted to be landlords in the first place is the fact that their portfolio may have been bought before the crash and now they are left with property that they are simply unable to sell. With all the loses that have been taken by most western investors over the past three years taking another hit by disposing of property at a loss simply isn’t an option.

Are These The First Shoots Of A Property Recovery?

According to the National Association of Estate Agents (NAER) the number of clients looking for a new home increased to a four year high in September 2011. That was the second month that the figures rose, a little piece of good news for home-owners looking to sell or worried about negative equity held in their property.

The growth in numbers of house hunters isn’t a huge leap by any stretch of the imagination, NAER figures show that the number of people registering to look for new homes rose on average from 304 in August to 308 in September. That’s not a lot of potential viewers it’s true but it’s the highest that many estate agents have seen since September 2007, when 326 people looking for new properties were registered at each agents’ offices.

The range of properties that each office deals with is increasing too, there were 65 properties, on average, per office in August this year, in September that figure went up to 72 although the number of sales remained constant at eight. But the increase in both supply and demand is certainly a good sign for any-body looking to sell their house and the housing market generally.

When it comes to commercial property to let Manchester seems to be growing too as businesses are seeking out two and three quarters of a million square metres of space over the next few months. Businesses are asking estate managementcompanies to look at strategies for maximising their floor coverage while cutting back on costs. For retailers that can mean remodelling the layout of the shop but for other businesses that could mean changing their office space all together. One business, the private healthcare services provider BUPA took on advisors to help them find an additional 140,000 square feet of additional office space. The biggest influences affecting the choices are total property costs, proximity to a skilled workforce, transport links and availability of distribution, local markets and consumers. Things that Manchester has an abundance of.