One needs to understand the industry before jumping into its business. Many things that look easy on the outside will surprise you when you get to their implementation. You should have a few resources beforehand if you are to start a property development business.

Make Sure You Know the Industry

People say you need money to start a business. Most successful entrepreneurs disagree. They say you need to have skills like no other to start a business, and the investment will come to you. Make sure you are worthy of running a successful business before you worry about finances. Learn everything there is to know about the industry you plan to target. For that, you may have to do a job, work as an assistant, or join a study course. When it comes to property development, you need to understand every corner of it. Start the business only after you are certain that you have explored the entire industry.

Arrange Investment

Once you are confident that you can run the property development business, it’s time to prove it. Your skills will be tested and there will be money on the line. You either have to invest your own finances or get a loan. It’s best if you have your own investment because that way you don’t have to answer to anyone. On the other hand, it won’t be a problem even if you don’t have the finances. As I said, the

investment will come to you if you are skilled. Anyone would agree to invest with you when they know you are not going down. You can get development finance from Property Finance Partners for your business. It is a property finance company that provides real estate raising finance solutions in the UK.

Keep Contact with Suppliers

A professional network is your net worth. You need to have contact with every supplier related to your work. You should also understand every service and product that you will use and their current value in the market. As a property developer, you may need services of builders, electricians, painters, architect, carpenter, plumbers, decorators, and interior designers. Having a reliable relation with these professionals will give you confidence and allow you to meet deadlines with quality work.

Understand Your Target Market

You should have a full understanding of your target audience before investing in a business. You should know who will need your services, how they will approach you, and if there is any space for you in the market. It can be difficult to survive in a market with fierce competition. Likewise, you should also know the right time to penetrate the market and when to take a break. Having an audience persona in your mind will help you better target your potential customers.

Use Digital Marketing

Marketing is important to make an entrance in the industry. While many property developers may underestimate it, digital marketing has helped many new entrepreneurs build their business. Use every marketing tool to get an edge over your competitors. Once you understand your market, targeting potential customer becomes easier.

Digital marketing doesn’t need you to have an office, you only need a website and a few social media profiles. You will reach out to potential customers through these channels. It’s also a great way to enter the market because it lets everyone know that you exist and now offering your services. Portray your skills and unique selling point on the internet. See what your audience is expecting from your industry and provide them an easy solution for that.

Build a Reliable Team

Every businessperson needs a team that he can rely on. The team builds the foundation of a business. If your foundation is strong, you are likely to survive in the market. Property development business doesn’t necessarily need a team if the leader is skilled enough. You will need the expertise of an accounting professional with the knowledge of all legal matters to understand and control all expenses. A project manager can divide your responsibilities and ensure that all development on site is in order. Moreover, you may need someone who understands the field to be on the lookout for opportunities.

Deciding Your Property Sector

A property business developer should know every sector of his industry. He should further understand the requirements of each sector where he wishes to operate. Whichever sector you choose, you will need to follow its every news and update. By specializing in just one sector, you are more likely to dominate it. You will know what, when, and where to buy, sell or rent a property. You will be able to make more sales by telling customers exactly what they want to hear if you focus on just one type of audience.

With the current average UK rent at £934 per month according to HomeLet, Bunk looked at what you can typically get for between £900-£1,000 and how it differs across the UK.

Studio flat, Brixton - £900 pm

Of course, £1,000 won’t get you much in London space-wise, but it will get you a studio flat in either South Kensington’s sought-after Gloucester Road, above Walthamstow’s famous Bell pub or in a gated Tudor style development in Brixton fit with a private pool.

One-bed terraced, Cambridge - £950 pm

In Oxford, you could secure a one-bedroom terraced house with scenic country views for £1,000 and in Cambridge you could also pick-up the same sized property for £50 less a month.

One-bed apartment, Granary Wharf, Leeds - £950pm

If you prefer apartment living, you can snap up a one-bedroom apartment in Gordondale House in Aberdeen, the Royal Parade in Bristol, the Mailbox in Birmingham, Granary Wharf in Leeds or the 32nd floor of the 47-storey Beetham Tower in Manchester.

Two-bed apartment, Mann Island, Liverpool - £950pm

If you’re looking to up your property potential and add another room, a budget of £1,000 can secure you a two-bed apartment in Liverpool’s waterfront Mann Island development, Nottingham’s historic Lace Market conversion, Sheffield's Victoria Quays, the unique Exchange building in the heart of Leicester, Clarence Parade in Portsmouth, a sea-front view in Bournemouth’s Honeycombe Chine, Cardiff’s old flour mill building Spillers and Bakers, Castle Chambers in Glasgow or Swansea’s Maritime Quarter.

Two-bed duplex, Oxford Street area, Southampton - £980pm 

Or, a similar budget would secure you a two-bed duplex in a grade-II listed building in Southampton’s trendy Oxford Street area, or a two-bed terraced with traditional features in Edinburgh’s Rosebank Cottages.

Four-bed terraced house, Lancaster Street, Edinburgh - £1,000 pm

Finally, for a budget of between £900-£1,000, you could rent a three-bed apartment in Compass House, Plymouth, fit with balcony and view of the marina, or a four-bed terraced house in Newcastle, close to Science City and the university.

Co-founder of Bunk, Tom Woolard, commented: “The UK rental market is home to a wide and wonderful variety of properties to suit all styles and it’s interesting to see just how the stock available differs when you take the same monthly budget and apply it to the various regional cities across the nation.

"Of course, you get a lot more property for your money when you look to the more affordable areas but that doesn’t mean you can’t find something with a bit of personality even in the likes of London, Oxford and Cambridge.  

"All too often, the speed at which property can let means that many tenants will settle for the first thing they find and are able to put a deposit on, but it can make a real difference to your life satisfaction in the rental market if you are able to find a property that you love to live in, rather than one you just choose to live in.” 

It is very likely to be the most significant purchase you ever make. Because of its long term ramifications, you want to take the process seriously. Below, the experts at Crawford Mulholland provide Finance Monthly with a simple guide to buying your first home.

1. Are You Ready?

First, you want to examine whether or not you are actually ready to purchase a home. Buying a home isn't something that you should jump into without proper preparation and knowledge. While owning your own home might sound appealing, it involves a lot of maintenance and ongoing work. When you own a home, you are responsible for paying all of the repairs and you are going to be responsible for paying for the respective taxes, insurance, and everything else. Because of this, you need to figure out if you are financially ready for such a leap.

2. Budget For Other Costs

You want to be sure that you are factoring in the costs that you might not necessarily be looking at initially. There are plenty of costs associated with buying your own home that you have to factor into your buying decision including but not limited to the removal costs, stamp duty, the initial furnishing, the survey costs, the solicitor's fees, and more. Make sure that you are factoring in everything when you are making a buying decision.

3. Shop For A Mortgage

Once you have decided that you want to go ahead and purchase a home, you want to shop around for a mortgage. This way, you will be able to minimise the interest rates that you are forced to pay on the mortgage. You will be able to search for some of the best mortgage rates online in order to find the best deal. You want to find the best deal because it will end up saving you a lot of money in the long run and you will need to look to see which type of mortgage would best suit your family.

4. Find The Right Property

When you are shopping around for your first home, you want to take the necessary steps in order to find the right one. Finding the right home is very important because you don't want to make such a large investment in something that you are going to regret later on. Take your time to figure out where you want to live and find a home that is suitable for you to live. You should be looking at the different properties in the surrounding areas that you would like to live to see whether or not you can find a place that you would love to call home. Don't rush the search process because it is going to dictate where you live for the foreseeable future. You want to factor various things in this process including how long the home has been on the market, why the property is being sold, and what is included in the sale.

5. Prepare To Negotiate

If you are going to be purchasing a home for the first time, you want to be prepared to negotiate. Without proper negotiating, you are not going to minimise the total price you end up having to pay for the property.

Overall, there are plenty of things that you can do to make the process much simpler. By following the tips above, you should be able to maximise your chances of finding a great home to purchase as a first time home buyer.

One of the top things that you need not skip is the "staging" process. This is the phase where your house will be readily available for potential buyers to see. Not only does this help you sell your property faster, but it even helps you add a few more pounds and value to your house for sale. Listed below are some tips on how you can prepare for your house's staging process.

1. Declutter

Go over your entire home and de-clutter your space. Whether it's a one-story home or a three-story house filled with lots of rooms and baths, you may want to go over your things declutter those that you're not using at all. Give it to charity, sell them, give it to a friend. If you've not used it for months, then it's probably best that it goes. While you may not be including furniture pieces at home along with the sale, this is still an important process because we want to make sure that potential buyers won't see the house in a "messy" and "cluttered" state.

2. Re-Paint

A fresh lick of paint will immediately transform an old-looking house and give it a fresh, new look. Make sure that when you're showing your property to potential buyers, given them a nice impression. Show them how beautiful the property is, and they can't appreciate it if the paints are all chipped, old, and dusty. Choose neutral colors for the paint and avoid personalizing the house too much. This way, buyers can see the true beauty of the home and they can do the personalization themselves.

3. Keep It Clean And Minimal Looking

If there are minor repairs that need to be done, do it. Do you have holes in the wall? Fix it? Are the door knobs broken? Replace it! We want to make sure that the house looks clean, refreshing, yet minimal looking. Do not over-decorate. It's hard to appreciate the entire house when it is filled with large furniture and overwhelming with home decor.

You may also want to do a general cleaning this time. If you can't do it, hire someone to professional help you with this. Get rid of the lime streaks if any, clean the windows, make sure that the floors are waxed - until every inch of the house is squeaky clean.

4. Upgrade Your Kitchen!

Did you know that the kitchen is one of the most precious and well-prized of your home? Many people's decisions make or break when it comes to the kitchen. Resurface your kitchen cabinets, replace the tiles or clean them if they're all filthy. You may also want to consider upgrading your kitchen countertop. It may be a little bit expensive, but it definitely adds a lot more value to your home and helps you sell it at the best price.

5. Keep It Light And Airy

Give your guests a welcoming feeling. Make sure that the house doesn't have furniture that is too squished or too close together. Making it look light and airy adds value to your house and can even help you sell it at a higher price.

6. Keep House Smelling Clean!

We don't want potential buyers stepping into your home while the house smells stinky! If there are drainage problems, it may cause odor and we don't want to just patch that with a band aid. Instead, to add value to your home and to make sure that it sells quickly at the best price, fix the source of the problem.

During a house visit, you may also want to bake some cookies or bread, as it helps them feel at home. Or, you can add some diffusers for a nice smelling home with therapeutic effects too!

8. Work With An Estate Agent

Lastly, to make sure that you won't be ripped off by potential buyers, make sure that you work with an experienced real estate agent. Find one that has extensive experience in this field and one that can help you further increase the value of your home. When giving potential buyers a tour to your home, let the agent do the talking. They're the ones trained and they know exactly what to say, to help you get the best price and even sell the home much quicker.

Letting agents are great in that they manage the trickier and lengthier aspects of tenancies which landlords typically dislike. With that said, finding one which best suits you and your needs can be tricky, CIA Landlord Insurance has put together a handy guide which may assist in laying out the basics.

Who is likely to benefit from using a letting agent?

Typically, landlords who benefit from the use of a letting agent are those who have a large number of properties to manage. Also, landlords do not always live close to the property they are renting out, so a letting agent close to the property may prove wise in order to keep tabs on their tenancies.

Letting agents work well for inexperienced landlords, where they can be utilised for some added security and support. It is highly important landlords are up to date on relevant regulations and legislation, therefore if you are not or you do not feel comfortable in this department, it is most-definitely worthwhile using a letting agent.

What services do letting agents provide?

There are varying levels of service which letting agents provide, from a ‘let-only or ‘tenant-find’ service for example, through to the more comprehensive ‘fully managed’ service.

A ‘let-only’ and ‘full management’ service are typically the two main categories which a letting agent will provide.

A ‘let-only’ and ‘full management’ service are typically the two main categories which a letting agent will provide.

With a ‘let-only’ service, the letting agent takes responsibility for things such as providing rental assessments to give you a better understanding of what you can realistically charge, conduct viewings on your behalf and acquire references from tenants. What can also be expected from this level of service is a tenancy agreement to be provided, credit checks performed and the tenants first payment be taken by them.

A full management service, on the other hand, will incorporate all of the aforementioned elements but you can expect the letting agent to take responsibility for the day-to-day management, too. If for instance, a tenant locks themselves out of the property or there is a boiler fault, the letting agent will arrange for one of its approved contractors to resolve the issue.

What is the cost of a letting agent?

The cost of a letting agent greatly differs depending on factors such as the location and size of your property. As it is a highly competitive market, there is always the prospect of negotiation to get yourself a better deal, so long as you are prepared to haggle. Request a price from a number of sources in your locality, and begin negotiations from there.

If a small independent letting agent is hired, then for a ‘let-only’ service you may be fortunate enough to pay as little as a couple of hundred pounds for the service. However, the likelihood is you will pay the equivalent to a months rent + an annual tenancy renewal fee.

It is important to note, from June 1st 2019 landlords or letting agents are no longer able to charge these fees to tenants. This means that (some) letting agents have been offsetting this loss onto the landlords (therefore paying double what would originally be paid for the renewal fees).

A full management service will typically be a 12-month deal with fees starting at around 12% and can rise to as much as 20% depending on location. If you come across prices lower than this, it may be wise to avoid them for reasons of service quality.

A full management service will typically be a 12-month deal with fees starting at around 12% and can rise to as much as 20% depending on location. If you come across prices lower than this, it may be wise to avoid them for reasons of service quality.

Should I use a letting agent?

With a wealth of information at our fingertips, it may seem lucrative to consider a ‘DIY’ approach for conducting a letting agent’s traditional duties. With plenty of research, it is possible you can do it yourself. Only go down this road if you feel confident in yourself to abide by the relevant regulations and legislation.

One thing to consider if you do decide to use a letting agent, check to see if they are registered with an industry body or trade association. These include the Association of Residential Letting Agents (ARLA), National Approved Lettings Scheme (NALS) and UK Association of Accredited Letting Agents (UKALA) as the main bodies whereby the letting agents have to adhere to certain standards in order to become a member.

The idea of being a landlord is great, but the reality, for the most part, is it is not an easy task. Taking control of all of your own property management may prove extremely difficult depending on the size and number of property’s you own, and the nature of your tenants. You may have the best intentions of delivering everything all of your tenants require but sometimes this may not end up as being the case. If dealing with unhappy tenants is your idea of a nightmare, letting agents will do this for you.

In accordance with your own circumstances and requirements, only you as a landlord can make the decision but by keeping yourself well informed on all aspects discussed in this guide, to begin with, you can improve your chances of making the best possible choice for you.

However, despite propaganda and horror stories surrounding the housing market in the UK, and the question of how Brexit will affect this, there are actually a lot of positives to buying in the UK at the present. It may well be the case, that now is in fact the perfect time to buy a house in the UK, and here’s why.

Population Levels

A recent census actually showed that the population has grown by a record of 7% in the last decade to just over 68 million people. That’s almost the equivalent of adding the entire city of Manchester to the UK every year. In the next twenty or so years, the number of UK houses needed is expected to reach the sum of at least 28 million, which is an increase of 250, 000 households per year. With rapidly growing numbers like this and the demand for houses growing, why wouldn’t you invest in a property? Not only this, but cities such as Birmingham, Manchester and Leeds are flourishing like never before. London no longer has the monopoly, as many places up North are regenerating. Birmingham alone has gone through a complete transformation, costing over £500 million in development.

Low Prices

Housing prices are at an all time low, meaning it can only go up from here, so why wouldn’t you buy them now in order to make money on them later? It’s a very rare combination: the

weak pound, low interest rates and falling property prices. Because of these elements, borrowing is cheaper than ever, and mortgage rates are at an all time low. This increases the amount of money landlords can charge for rent, thus making their monthly rental income higher than ever before. Therefore investing a buy to let property in the UK at present could make you a lot of money in the long run.

Other Positives

Of course there are further positives to investing in a UK property:

• Studies show that the UK is actually the top European city for property investment, despite political Imagine how much it will boom when Brexit is (finally!) concluded.
• For investors, thanks to the internet and a growth in the alternative methods of sale to the traditional, such as quick sale investors, for example here. This is a great option in case investors end up looking for a quick cash sale, or alternatively look to make a purchase of the
• If statistics are indeed correct, it’s set that at least 20% of the population will be looking to rent their home rather than buy them in the next five If this is the case, then now would be the perfect time to invest in a buy-to-let property. Imagine the money you could make in the future - not bad for the pension pot. Sometimes an investment now is worth the reward you’ll get in the future.
• In the world, out of the top universities, sixteen are actually in the
• In regards to the growth in population, mathematically there are actually too few houses for the amount of people in the country now, and by how much that’s set to grow. Because the demand outweighs the current supply, investors who have exposure to property as an asset are likely to be able to regenerate a return from
• The rise in employment levels in the country is also another reason for investors to buy. By the end of 2017, 75.3% of people in the UK were then employed, as opposed to the 5% the previous year. 2017 showed the joint highest number since records began in 1971. To make this more useful, in numbers it means that roughly 415,000 more people were employed since 2016.

In short, these are only a small amount of the reasons why it’s worth investing in the UK now, and why in fact it’s the perfect time to buy property in this country. Regardless of your purpose, whether you’re looking to become a landlord or wanting to buy your own home, looking at prices and statistics now is the ideal time. So what are you waiting for

This is according to a recent study by KnowYourMoney.co.uk. Meanwhile, separate data shows that, in total, there are just over 11 million mortgages across the country, with the combined value of the mortgage market coming in at £1.3 trillion. Here John Ellmore, Director at KnowYourMoney.co.uk¸ discusses further the correlation between a lack of financial planning and subsequent mortgage troubles.

It’s a huge market, and for most people a mortgage will be the largest single debt they take on in their life. It is vital, therefore, that consumers are thorough and diligent in both finding the right mortgage product and making mortgage repayments.

Navigating the mortgage market

Returning to the aforementioned research by KnowYourMoney.co.uk, not only did the survey uncover the types of debt people have, but it also offered insight into the ways Britons are managing their finances. And there were some concerning findings.

Most notably, two thirds (67%) of those in debt have no savings stored away to enable them to pay off debt if required, with men (73%) more likely than women (62%) to lack a financial safety net. Furthermore, nearly three in ten (29%) said they do not feel in control of their debt and have no plans of how they will pay it off.

In light of these figures, it is perhaps less surprising to note that 24% of people in debt said they lose sleep because of it.

When it comes to mortgages, planning and preparation are key. Indeed, with so many mortgages available – 4,214 new products were introduced into the residential mortgage market between 2016 and 2018 alone – choosing the most appropriate option can be challenging.

Importantly, this challenge starts with an individual understanding his or her personal finances.

Debt-to-income ratios

Essential within this planning phase is to know one’s debt-to-income (DTI) ratio. In short, this offers an indication of how much debt a person has in relation to their earnings – it is calculated by dividing total recurring monthly debt by gross monthly income.

But many people are in the dark about DTI ratios; 44% of UK adults do not know what their debt-to-income ratio is, with 39% admitting to not understanding the term.

This needs to be addressed. Without understanding exactly how much debt one can responsibly handle, securing the right mortgage is extremely difficult.

Of course, a mortgage provider will undertake its own due diligence in ensuring a borrower’s income is sufficient for the terms of a particular mortgage. However, in truth, the lender will never be able to match the borrower’s granular insight into their finances.

Avoiding bad debt

Ultimately, despite the negative connotations that still surround the word, debt is an extremely valuable financial instrument. It enables people to pursue life goals otherwise out-of-reach. But we must recognise there are good debts and bad debts.

Good debts are both manageable and will provide value to the individual – mortgages are a prime example of this, assuming the amount borrowed can be repaid. Bad debts are those that cannot realistically be repaid or provide no value – taking on debt to pay-off other debt is a common example of this.

Mortgages, by and large, are good debts, but only when the monthly repayments can be made without being overly restrictive to a person’s financial situation. The first step is for consumers to ensure they know what their DTI ratio is – a task that takes just a few moments thanks to online DTI calculators.

Failure to do so could cause problems down the line. Illustrating this point, it is estimated around 88,000 mortgages in the UK are in arrears of 2.5% or more, while there are 52 mortgage possession claims made every day.

To avoid falling into this situation, borrowers must be sure they only take on good debt. Moreover, whenever possible they should set aside savings to help make repayments in case of cash flow issues or interest rate changes in the future.

Thorough preparation and careful management are at the heart of any successful financial strategy, and when it comes to mortgages these are essential in ensuring people navigate the market safely and only accrue debts in a safe, responsible manner.

Here Jamie Johnson, CEO and Co-founder at FJP Investment, discusses with Finance Monthly the real impact of Brexit on the UK property market.

While it may seem like the country has ground to a standstill as the political standoff in Westminster continues, we cannot let this overshadow the activity and trends underpinning many of the UK’s leading sectors.

The property sector is a case in point – domestic and foreign investment continues to pour into the market, increasing house prices grow and in turn producing attractive investment opportunities. Recent research suggests that property investors also stand undeterred despite Brexit uncertainty –almost half (45%) of property investors have expanded their property portfolio since the EU referendum, whereas only 7% said they had sold one or more homes as a direct result of Brexit.

To understand why the UK continues to be a prime property hotspot despite the current state of political affairs, it can be valuable to reflect on how the sector has fared over the last two and a half years. This including understanding the key trends that have played a central role in shaping the real estate market.

Strong regional growth

In times of uncertainty or transitions, commentators like to take a keen interest into how different sectors are performing in London. As a cosmopolitan hub renowned for its residential and commercial real estate opportunities, the capital has faced some challenges. Since the EU referendum, house prices have largely stagnated, and in some postcodes even fallen.

However, focusing on primarily on London risks overlooking the progress taking place in regional markets. Indeed, national house prices have actually been on an upwards trajectory in recent months, driven largely by strong growth in places like the Midlands and North of England.

Birmingham (up 16%), Manchester and Leicester (both up 15%) have experienced the fastest rates of house price growth since the June 2016 referendum, followed by Nottingham (14%), Leeds (12%), Liverpool and Sheffield (both 11%). In real terms, this means that the average property in Birmingham now stands at £163,400, while the average house in Manchester costs around £168,000. For an investor, this attractive capital growth few assets can match.

So, what are the underlying reasons for these strong performances? Much of it comes down to large-scale regeneration projects which are reviving infrastructure, construction and transport links. Some of the construction works include the redevelopment of land close to new stations that are being created for High Speed 2 (HS2).

Property as an attractive asset class

Significant public and private investment is undoubtedly bolstering the sector, yet another important trend to note is the volume of property transactions taking place even at the height of Brexit uncertainty.

In January of this year – just weeks from the original Brexit deadline, and without a clear vision of what the UK’s transition from the EU would entail in practical terms – the number of transactions on residential properties with a value of £40,000 or greater was 101,170, or 1.3% more than a year prior.

This is testament to the underlying popularity of property as an asset class able to deliver long-term returns, and weather political and economic transitions. In fact, recent research revealed that Brexit hasn’t dampened investor sentiments towards property; the survey of over 500 property investors revealed that 39% plan to increase the size of their property portfolio in 2019, regardless of the ongoing negotiations.

Challenges facing the market

Notwithstanding the obvious challenges facing the UK – namely, setting out a clear direction for the future of the country outside of the EU – there are some pressing national priorities that also deserve attention.

Perhaps most important of all is the housing crisis. At present, there are simply not enough affordable and accessible houses on the market to meet growing demand. And while the government has set targets to address this issue, there is an overwhelming fear that these goals will ultimately fail to materialise.

Last year, Prime Minster Theresa May committed the government to delivering 300,000 new homes a year by the mid-2020s. Although a positive step in the right direction, the current pace of progress suggests that construction efforts will fall short of reaching this target.

Figures released by the housing ministry in March 2019 showed that building work began on 40,580 homes in England during the final quarter of 2018. This is down 8% on the previous three months. Further to this, a National Audit Office report recently concluded that half of councils are expected to miss house building targets.

While Brexit has largely taken priority over important issues, the Government cannot put off committing the necessary time and resources towards rebalancing housing supply and demand. Creative reforms are needed, and debt investment projects, such as off-plan property investments, are but one of the many solutions that could promote the construction of new-build properties.

Despite the current obstacles facing the property market, UK real estate has proven itself to be a resilient asset class even in times of hardship. Bricks and mortar remains a popular destination for domestic and international investment, and looking beyond the more immediate challenges lying on the horizon, it is important to recognise the resilience of property as a leading and desirable asset class.

Following, we are going to explain the trends that led to this massive change and what it means for young buyers.

1.  Ripple Effective

The successive cycles introduced in 1970s consist of economic houses where the property value increases first in London, this wave then goes south easy and other reasons. London always stayed at the front. However, the percentages were not always impressive.

Prices of houses in London have bee n doubled in North (Yorkshire, and Humberside).

2.  Income Growth

There have been some changes in regional prices. These are influenced by national factors like low interest rates and an increase in real incomes. The real incomes have had an impact on house prices. A 1% increase in real income will lead to a 2% increasing house prices. This is because households can afford to pay a bit more. This way, the house prices show a bit more volatility than the respective income.

3.  Supply, Demand and Other Patterns

Recently, there has been poor income growth in London. This shows that England is operating in a weak national housing environment. But it doesn’t show the regional price pattern. Internal migration patterns, supply shortages, higher demand in London also have their impact.

It's important we look closely at the southeast and see how outer London relative to inner London and South-East is as a whole. We need to focus on areas that aren’t very distant from each other. Recently, more people left London than the ones who entered it. London has attracted young people recently, but some older groups have left the city. This loss declined until 2009 but peaked once again, especially in 2016-2017.

This pattern is rather consistent and is leaving an effect on real estate prices. As a high proportion of people are leaving London to settle someone where else, there will be a fall in house prices in London as compared to the South East in the past two years.

In case if you are a young professional and looking for accommodation, you should try to find flats to rent in Edinburgh. CityLets.co.UK is a certified leading property portal that enlists properties for rent all around England. This site has been helping people finding ideal accommodation since 1999.

4.  Types of Property

The price for different types of properties increased and decreased in different patterns. Families can easily move to different locations as they can easily adjust into a different type of property.

With that said, its time we discuss the differences between prices of terraced properties in inner and outer London. This shows the inner London real estate market suffered from a drop-in value. This is once again consistency with Households moving to expensive inner regions.

5.  Investment Opportunities

Migration flow isn’t the complete story. The southeast is also suffering from shortages, but it’s time we discuss the monetary environment and low interest rates.  Housing in London is included by its role as an investment along with being a consumption good.

Investment motives for buying housing are important in other areas, but London has some special characteristics. Prices in London are more responsive to changes in interest rates than anywhere else.

Speaking of falling prices, the average flat in London costs more than £400,000. The average flat in south-east costs £200,000. Even if we ignore the massive difference, this is still beyond the resources of most first-time buyers unless they have strong additional support. In short, the price falls will unlikely to benefit first-time buyers.

Nowhere across London is more unaffordable than Kensington and Chelsea and Knightsbridge in particular and rental costs in the borough are some of, if not the highest in the capital having increased over 23% since 2012.

But since June 2012, Julian Assange has managed to not only live rent free in prime central London, Harrods adjacent and just minutes walk from Hyde Park, but dodge any increase in living costs associated with renting.

The current average rent for a room in Kensington and Chelsea is £1,928 a month and while he may have been forced to pay for the upkeep of his cat, by claiming refuge in the Ecuadorian embassy over the last seven odd years, Assange has saved a huge total of £148,381 - an average of £1,810.

Tom Gatzen, co-founder of leading flatshare platform ideal flatmate, commented: “We’ve seen the capital’s tenants resort to some drastic measures to deal with the cost of renting in London but I think Julian Assange takes the gold for his commitment to a cost effective lifestyle in the London rental market. 

"It doesn’t seem all that long ago that he entered the Ecuadorian embassy but to think in the time since, the average tenant in Kensington would have paid £150,000 in rent for just a single room, which is actually quite mind boggling.  

"Of course, Kensington sits at the top of the table where rental costs are concerned but it does go to show how the cost of renting in London continues to spiral out of affordability for many.

"While Julian’s saving has been notable the harsh restrictions around leaving the property and the immediate eviction process that he underwent probably weren’t worth it. We would have recommended using ideal flatmate so he could have not only split the cost of living in London, but our personality test could have matched him with like-minded roommates.

"If the Ecuadorian embassy is at a loose end with the now empty room, we can certainly help them fill it with a suitable tenant that will bring less media attention and contribute to the monthly living costs.”

We are often asked which is better – property or an investment portfolio. Below, Dan Atkinson, Head of Technical at EQ Investors, answers all your questions.

We invest many things during our lifetimes. Whether it’s time, money, or experience that we are investing we are always looking for a future outcome. When we invest money it’s important to frame our decisions with what we want our future to look like. It’s helpful to have this approach when we decide how to invest our money.

One decision people often consider is should they purchase a buy-to-let property, or should they build an investment portfolio? It’s not quite a clear-cut decision and a better question would probably be, what mix is right for you? Let’s have a look at some of the important factors you need to think about.

Buy-to-let

Many of us are familiar with the housing market and have watched our own properties increase in value. A property rented out to reliable tenants can be an excellent source of income. Rents vary hugely across the country, so always do your research.

It is important to remember there will be costs to cover such as general repairs and maintenance, agency fees and insurances. These costs will continue whether you have paying tenants or not. As a landlord you will also be taking on a number of legal obligations which may result in additional costs. You can outsource some of your responsibilities to a manging agent but this will reduce the return.

However, over the last few years the Government has started to reduce the tax efficiency of property investment. Investors will pay an extra 3% Stamp Duty Land Tax when they buy a residential buy-to-let property. They also previously enjoyed Income Tax relief on mortgage interest, but this is also being reduced and will be restricted to 20% from April 2020. When they eventually come to sell their properties, this will now be subject to Capital Gains Tax (CGT) at 18% (within basic rate band) or 28% (higher and additional rate taxpayers) on the gains.

This coupled with rising property prices leading to lower yields makes it harder to find the right property and more expensive to build a diversified portfolio than it was in the past.

Investment portfolio

Investment portfolios can potentially enable you to spread your investment more widely as you are not having to buy one expensive asset. This means that investors can build up more diversified portfolios to generate income and capital growth. Instead of having their investments just in one town, city, or country they can invest across the globe. Spreading their money into different types of investment such as property, equities, and bonds helps reduce some of the risks.

Whether you choose to build your own portfolio or delegate this to a professional, there will be costs. These relate to the ongoing management of the funds, ensuring that the overall mix remains suitable for you, and a structure to hold these safely and securely.

Investors have a choice about how they hold their portfolio. ISAs in particular provide freedom from Capital Gains Tax and Income Tax; you can add £20,000 to your ISA each year.

Income generated by a portfolio is taxed differently to property. For investments held outside an ISA, the first £2,000 of dividends are tax free and the subsequent rates (7.5%, 32.5% and 38.1%) compare favourably with the main rates of Income Tax (20%, 40% and 45%). Some of the income generated by a portfolio will be taxed as Interest and most investors will have a tax-free Personal Savings Allowance of up to £1,000. The respective rates of Capital Gains Tax are also lower at 10% and 20%.

Perhaps the biggest advantage of using an investment portfolio approach is liquidity. It isn’t possible to dip in to the capital value of a buy to let property without selling the whole thing. In comparison you can sell part of an investment portfolio if you need access to capital. As well as the practical and tax considerations, it is normally a lot quicker to sell an investment than a property.

In summary

So what about you?

As with many aspects of life and financial planning there is no easy answer. You should consider what you need this money to do for you. For most people our money is there to serve our lifestyles (current or future). If we start to find managing the money takes away from this then we probably need to reassess our decision.

If you are likely to need to dip into it then an investment portfolio might be more attractive. Delegating responsibility about where to deploy your money and the day-to-day management may also become desirable as how we want to spend our time changes.

Benham and Reeves looked at the historic FTB property price data from the Land Registry and how this had changed month to month across each UK region and London borough, before projecting these monthly price changes forward 34 years to see what the average first-time buyer house price could hit for those born today.

With the average FTB now 34 years of age and today’s average FTB house price in England at £207,526, those born today could be looking at an average of £1,214,381 to get on the ladder in 34 years’ time.

This is, of course, much higher in the capital and despite the current market slowdown, the average FTB house price in London is now £412,679, although this could increase to a huge £4.5m over the next 34 years.

The data shows the average FTB house price would also top the £1m mark in the East of England and the South East, where the average house prices are currently £241,259 and £259,567 but could hit £1.9m by 2052.

The cheapest area to buy for FTBs born today would be the North East with a predicted price of £210,739, up from £110,645 today.

Looking into London, Kensington could be toppled as the capital’s most expensive borough, from an FTB perspective anyway. Despite the much higher price of property today, the slower rate of growth in FTB property prices in the last seven years means that Waltham Forest could overtake the PCL borough with an eye-watering average house price of £11.5m by 2052.

Kensington would still rank second with an average FTB house price of just under £8.4m, with Hackney (£6.8m), Westminster (£6.8m) and Haringey (£6.6m) all home to some of the highest prices when getting on the future ladder.

Hounslow has seen the slowest rate of growth in FTB house prices historically and ranks as the most affordable for an FTB born today, but even then they would need a whopping £2.8m to get on the ladder in 34 years’ time.

Benham and Reeves Director, Marc von Grundherr, commented: “This research considers the ups and downs of the first-time buyer market historically and how things could play out for the generation of first-time buyers being born today if these trends were to repeat themselves. 

Of course, it’s impossible to predict the future of the UK property market, particularly given the current turbulence caused by wider economic and political factors, however, this research acts as a warning of what could happen if we continue to fail in the delivery of affordable starter homes.

Not only does it show the huge jump in prices over previous years but how this could worsen further down the line. 

While we hope that prices won’t reach these dizzying heights, we’ve certainly seen stranger things happen across the UK property market in the last 34 years, so who knows what the next 34 may bring.”

(Source: Benham and Reeves)