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 People should consider buy-to-let & remortgages carefully - 18/09/2006
Taking out a buy-to-let mortgage or remortgage in order to let out property is an increasingly popular way to invest, but would-be landlords have been warned to do their homework before committing.
Consumer guide Which? said that buy-to-let mortgage borrowing set new records in the first half of 2006, with loans worth £17.5 billion advanced.
The company has issued a new guide to aid prospective buy-to-let borrowers, called Renting and Letting.
While buying property can be a good investment, bringing in a good return while the property rises in value, borrowers need to weigh up their options carefully, the company said.
The rent from the property needs to exceed running costs by 25 to 30 per cent in order to cover large expenses such as a broken boiler and to cover the owner for times when the property is not rented out.
Author of Renting and Letting said: "Budding property entrepreneurs should remember there are lots of ways of investing, and buying property can be risky.
"You must be sure at the outset that buying to let will give you better returns than putting your money in the bank for the same period of time."
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Housing Martket positive - 15/09/2006
House prices rose for the fifth month in a row in August 2006, new figures reveal.
The report from the Royal Institution of Chartered Surveyors (Rics) said that house prices rose at their fastest pace since May 2004 last month, with 35 per cent more chartered surveyors reporting a price rise than fall last month, compared to 30 per cent in July.
Newly-agreed sales rose at their fastest rate since November, while buyer enquiries accelerated at the fastest pace since September 2003.
The institution said that the sharp price rises were being driven by a return of would-be buyers to the market and a shortage of new property coming onto the market.
A firm labour market and above trend economic growth was encouraging would-be buyers to return to the market, the report found, with the price boom continuing to be centred around London and the south-east of England.
Although interest rates were frozen in september the market predicts an increase shortly and many remortgages are taking advantage of fixed rate deals.
The number of fixed rate offers for remortgages is reducing however and the rates available have started to increase already.
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