Land of hope

As more landlords choose to use their properties to fund lifestyle changes, the outlook has never looked so positive for buy to let as recent research proves.

The Council of Mortgage Lenders (CML) buy-to-let figures bear testament to the upsurge in buy to let over the past few years. Figures for the first half of 2005 show that 63500 mortgages were outstanding at the end of the period, compared with 6600 five years previously. While more buy-to-let mortgages are being completed each year, the rate has gradually been slowing, but this is a reflection of the housing market as a whole and the prospects for buy to let in particular, are still very strong.

Standard Life Bank recently commissioned a survey of 500 UK landlords to find out who was investing in buy to let, what they hoped to achieve from letting property and to what extent they relied on or sought out professional advice. The research revealed that the buy-to-let sector is thriving and set to continue growing, which puts paid to the notion that the Chancellor's U-turn on SIPPs spelt disaster for the buy-to-let market.

Consumers are looking to the future with a sense of doubt and distrust. Investors are increasingly looking for alternative ways to boost their portfolios and build financial security for later life and they have the desire to find additional ways to fund retirement. For these investors, buy to let is an attractive and reliable option, with the potential to become extremely lucrative.

Standard Life Bank found that more than half (52%) of those landlords questioned used their property income to invest in their futures. A quarter said they are earning up to  £200 more than their mortgage commitments each month, 27% are earning between  £200 and  £500 extra and 13% are earning an impressive  £1000 extra each month, which equates to a substantial income stream each year.

The survey also found that most people make the decision to become landlords in order to invest in their long- term future.

It is not just about the future, though. There has also been a rise in people using their mortgages to fund lifestyle changes. The research revealed that one in five landlords uses the rental income from buy-to-let properties to fund life-enhancing activities €â ” 17% go traveling, 10% use the money to reduce working hours and work part-time, and 10% to retrain or set up a new business.


Professional advice

And the research also painted a positive picture for mortgage advisers. It revealed that today's busy investor would rather pay for professional advice in order to secure the best deal than investigate their options in their own time. A significant 60% of landlords who use an adviser said they do so because they are too busy to take on the research themselves.

The survey also revealed a high level of trust among investors seeking advice. Today's prospective landlords trust their adviser or mortgage broker to find the best buy-to-let package to suit their circumstances and aspirations. The vast majority (83%) of the landlords questioned said they felt advisers and mortgage brokers provided a complete service package and gave reliable advice relating to their investment.

In addition to this, more than a third (34%) of investors believed that using the expertise of an IFA or mortgage broker results in them getting superior buy-to-let mortgage deals.

Owning a rented property or a portfolio of properties is effectively the same as running a small business. Every landlord wants their business to succeed, which is why finding the right mortgage, or turning to an adviser or mortgage broker for guidance is a crucial first step.

The Association of Residential Letting Agents (ARLA) expects an expansion in the buy-to-let sector in the year to come. In December 2005 ARIA predicted that the buy-to-let market would increase substantially in 2006, reversing the period of marginal decline over the 12 months between June 2004 and June 2005. Most notably, this upward trend has not been affected by the Chancellor's U-turn on residential property in SlPPs last December.


Market future

The UK housing market is set for a broad period of stability and the CML, among other organisations and lenders, has forecast an increase in house prices of around 2%. With the prospect of a strong year ahead, there is likely to be plenty of competition between lenders with new product ranges, rates and service levels â € ” all of which will benefit customers looking to enter the buy-to-let market.

The future of the market will remain largely dependent on elements, such as steady rental demand and a healthy interest rate environment. Most buy-to-let investors take a more long- term view on rental properties and unlike with normal house purchasing, short-term movements in house prices and minor interest rate movements are of less concern to them.

The experienced investor will continue to buy carefully and selectively. The rental market is unlikely to suffer much from the SIPPs U-turn and is likely to remain buoyant. As more people realise that buy to let can bring them the freedom to live the life they want and can open new doors for them, it is likely that the market will increase.

For advisers and brokers, the prospects offered by the buy-to- âlet industry are extremely healthy € ” from the increased demand from first-time investors to landlords' open-minded attitude to professional advice. In this climate, advisers can help their clients to use buy-to-let investments as part of a holistic approach to financial planning and, in turn, those advisers can benefit from the numerous cross-selling opportunities this will afford.
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Establishing dreams and goals
by Jim Rohn

One of the amazing things we have been given as humans is the unquenchable desire to have dreams of a better life, and the ability to establish goals to live out those dreams. But what makes this even more powerful is that we have also been given the ability to not only dream but to pursue those dreams and not only to pursue them, but the cognitive ability to actually lay out a plan and strategies (setting goals) to achieve those dreams. Powerful!

What are your dreams and goals? This isn't what you already have or what you have done, but what you want. Have you ever really sat down and thought through your life values and decided what you really want? Have you ever taken the time to truly reflect, to listen quietly to your heart, to see what dreams live within you? Your dreams are there. Everyone has them. They may live right on the surface, or they may be buried deep from years of others telling you they were foolish, but they are there.

So how do we know what our dreams are? This is an interesting process and it relates primarily to the art of listening. This is not listening to others; it is listening to yourself. If we listen to others, we hear their plans and dreams (and many will try to put their plans and dreams on us). If we listen to others, we can never be fulfilled. We will only chase elusive dreams that are not rooted deep within us. No, we must listen to our own hearts.

Let's take a look at some practical steps:

Take time to be quiet. This is something that we don't do enough in this busy world of ours. We rush, rush, rush, and we are constantly listening to noise all around us. The human heart was meant for times of quiet, to peer deep within. It is when we do this that our hearts are set free to soar and take flight on the wings of our own dreams! Schedule some quiet "dream time" this week. No other people. No cell phone. No computer. Just you, a pad, a pen, and your thoughts.

Think about what really thrills you. When you are quiet, think about those things that really get your blood moving. What would you love to accomplish? What would you try if you were guaranteed to succeed? What level of wealth do you desire? Write down all of your dreams as you have them. Don't think of any as too outlandish or foolish - remember, you're dreaming! Let the thoughts fly and take careful record.

Now, prioritize those dreams. Which are most important? Which are most feasible? Which would you love to do the most? Put them in the order in which you will actually try to attain them. Remember, we are always moving toward action.

Here is the big picture: Life is too short to not pursue your dreams. Someday your life will near its end and all you will be able to do is look backwards. You can reflect with joy or regret. Those who dream, who set goals and act on them to live out their dreams are those who live lives of joy and have a sense of peace when they near the end of their lives.

Remember: These are the dreams and goals that are born out of your heart and mind. These are the goals that are unique to you and come from who you were created to be and gifted to become. Your specific goals are what you want to attain because they are what will make your life joyful and bring your family's life into congruence with what you want it to be.

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"Man often becomes what he believes himself to be. If I keep on saying to myself that I cannot do a certain thing, it is possible that I may end by really becoming incapable of doing it. On the contrary, if I shall have the belief that I can do it, I shall surely acquire the capacity to do it, even if I may not have it at the beginning." - Mahatma Gandhi 1869-1948, Indian Nationalist Leader

"You can't just sit there and wait for people to give you that golden dream. You've got to get out there and make it happen for yourself." - Diana Ross Singer and Actress


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The risks of property development

Over the years we have seen many inexperienced property developers lose money. It is true that great profit can be made from property development but it also carries a significant number of risks. If you are considering property development it is vital to know these risks, but just what are they?
Some of the most significant risks we have come across are as follows:

• A downturn in the property market leading to lower property values or increased holding costs until the development properties are sold



• Increases in interest rates resulting in increased holding expenses



• Increases in construction costs during the project. This was particularly obvious during the recent boom. Many inexperienced developers think they have entered into a fixed price contract yet are hit with cost variations



• Changes in the supply and demand ratio for the property market



• Unexpected disputes with building or trade contractors which can cause costly delays to a project



• Changes to the laws relating to property development such as the laws relating to town planning restrictions on land use, environmental controls, landlord and tenancy controls, user restrictions, stamp duty, income taxation and capital gains tax. Changes to any of these could adversely affect the profitability and viability of your development project



• Unexpected delays and increased holding costs may be encountered when town planning approval is required for a development. Not obtaining an approval or obtaining one on unfavourable terms is a growing risk for developers. The cost of obtaining approval or fighting council's rejection in a court of appeal is continually rising



• Some inexperienced developers find that some of the improvements they have made to their properties do not result in an increase in value. They learn the hard way that increases in value do not necessarily occur in line with expenditure on improvements

"Defeat is not the worst of failures. Not to have tried is the true failure." - George E. Woodberry 1855-1930, Writer and Critic

"People are always blaming their circumstances for what they are. I do not believe in circumstances. The people who get on in this world are the people who get up and look for the circumstances they want, and if they cannot find them, make them." - George Bernard Shaw 1856-1950, Playwright

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In the news


Buy-to-let market still buoyant

Bradford & Bingley's quarterly survey of UK landlords reveals a buoyant buy-to-let market.

It shows that 83 per cent of landlords are planning to either increase or maintain their portfolios in the next six months.

Rental arrears have dropped from 26 per cent to 19 per cent this quarter and over half of landlords questioned said they had no void periods in the past six months.

Bradford & Bingley buy-to-let product manager Andrew Moss says: "Buy-to-let ranks high in the popularity stakes for investors. Landlords are benefiting from the continuing rise in property prices and rents mostly staying the same or increasing."



House prices 'could rise by 6%'

Improved confidence in the housing market could boost property prices by 6 per cent this year, experts said.

The Centre for Economics and Business Research said it had revised up its forecast for UK house price growth during 2006 from just 4.4 per cent in January following stronger than expected confidence in the market and sustained growth in the financial markets.

But it warned it still expected house price inflation to taper off towards the end of the year as higher levels of unemployment and bigger household bills started to bite, while the impact of the interest rate cut in 2005 died out.

Jaspreet Sehmi, economist at CEBR and one of the report's authors, said: "We have edged up our expectations for 2006 house price growth because we expect stronger growth in the second quarter of 2006 than we previously did.

"Gains in London and the wider South East should lead the way.

"However we still believe house price inflation will slip back in the second half of the year as households come up against financial constraints."



British housing values treble in 10 years

The value of the Britain's private housing stock trebled over the last 10 years to 3.4 trillion pounds in 2005, three times the size of the economy, according to figures on Saturday from mortgage lender Halifax.

In news that is sure to be welcomed by the more than two-thirds of Britons who own their homes, the bank said property values in each of the last 10 years had risen at a faster pace than mortgage debt.

In the last decade, housing assets have grown by 213 percent, while mortgage debts grew by 148 percent, Halifax said.

"This increase in the value of the housing stock highlights that household balance sheets are in good shape," said Halifax Group Economist, Tim Crawford.

House prices have picked up in recent months following a sharp slowdown since mid-2004, helped by a cut in the Bank of England's base rate last August to 4.5 percent, and are expected to increase modestly this year.

Halifax said that in the last five years, the housing stock value had grown 73 percent from 2.0 trillion pounds.

In that time, housing values in London and its surrounding areas underperformed the rest of the country, increasing by just 53 percent -- while values in northern England showed the strongest increase of 139 percent.

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Need mortgage advice?

Maybe you're thinking of buying an investment property, or you need to release funds tied up as equity in your house. Perhaps you just want to find the best mortgage rate for your own individual circumstances and cut your mortgage payments. Why not call our mortgage department today? Our resident mortgage advisers will give you the best possible advice to suit your requirements. Call them today on 0870 1670996.
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What's available?

We currently have the following investment opportunities.

Victoria Place, Pile Marsh, St. George, Bristol
Equity Chambers, Piccadilly, Bradford
CV One, Lower Ford Street, Coventry
Florida Land Packages, North and Central Florida
Orpheus Ski, Bansko, Bulgaria
Erkel Haz, Budapast, Hungary
Sun Palace, Budapest, Hungary
Benatalya, Marbella, Spain
Punta Perla, Domican Republic, Caribbean


Please go to www.propertyforlife.com/property/ for full details and look out for more great opportunities coming soon!

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Upcoming events

Over the coming months we will be attending several exhibitions in addition to our ongoing Property Academy programme. If you would like to attend a property academy session please call Laura on our 01252 737575 or email laura@propertyforlife.com stating which session you would like to attend and how many places you require.

May 20th 2006 - PFL Property Investment Academy - The Felbridge Hotel, Nr Gatwick

June 24th 2006 - PFL Property Investment Academy - Cheshunt Nr Enfield

For further information regarding the Property Investor Academy Programme please follow the link www.propertyforlife.com/whyinvest/education.html

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Do you fancy a spending spree at one of the UK's leading department stores?

The new look Property for Life referral programme can offer you just that.

All you need to do is tell an interested friend about Property for Life and you could soon have a minimum of  £250 in gift vouchers to spend in any John Lewis or Waitrose store.

Quite simply, for each person introduced by you who then purchases a property through us you will receive a cool  £250 in John Lewis gift vouchers. If they purchase more than one property you will receive  £250 in gift vouchers for each property they purchase. You could soon be well on your way to that spending spree.

Remember, the more people you introduce the more chance you have of grabbing at least £250. So why not tell your friends and family about Property for Life? Make sure they register on-line at http://www.propertyforlife.com/register. When registering it is important that they select the recommendation option in the 'How did you hear about us' section of the form and include your name in the 'other' box.

Please note that the referral programme is on a per property not a per person basis. Please see http://www.propertyforlife.com/services/referalprogramme.html for further information.


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