Off Plan Developments – It May be Getting Harder to Walk Away

I see that some property investors who walked away from off plan deals face being prosecuted by the developers after a test case which a developer won.
In the last few years, lots of purchasers have tried to walk away from duff off plan property deals - figuring it was better to lose their deposits than complete purchases on properties where the values had fallen heavily (and they were effectively overpaying.)
In some cases, willing buyers were unable to complete their deals anyway as their mortgage lenders had pulled financing as prices of these types of properties collapsed.
(Not terribly bright valuations done in the first place then by the banks!)

High Court Case
The recent High Court test case was won by Prestige Homes and this case could lead to lots of other cases being taken to court by developers.
However, at least one group of investors is resisting, claiming one developer recommended customers use the developers own preferred solicitors who presented purchasers with lists of valuations supposedly carried out by other surveying firms which miraculously matched the sales list”.
Somehow, this all seems very familiar.
I have to say that it really is a case of buyer-beware in property, especially where new build was concerned.
Back in the early and mid Noughties, many new and green investors got mugged by so called "property clubs" into buying a lot of new build stuff that was way overpriced.
We are still seeing the fall out today.

Keys
When I buy a property I love it if the previous occupant leaves lots of keys behind.
Getting new keys cut seems to be getting rather expensive these days and even worse, takes up lots of time as the keys you get copied often don’t fit, necessitating extra trips back to the locksmiths.
This is one of the really irritating nitty gritty aspects of being a hands-on landlord.
If any locksmith can guarantee that he can cut an EXACT copy of a key that he guarantees to fit my locks perfectly, then he can have all my key cutting business.

BBC International – Why Bother
I’m just back from a lovely business -cum-holiday break in Mexico.
And as I always when I’m abroad I watched CNN to keep up with the news - not the much inferior BBC TV service.
If the BBC cannot put out a decent international product, maybe it would be best to shut it down completely.
The BBC Radio service overseas is great… but the TV…. Well, I wouldn’t bother.

MORE ABOUT LETTINGFOCUS AND WHAT WE DO

LettingFocus.com is the home of landlord information.
Hello, I’m David Lawrenson.
I have been a landlord and property investor myself for over 25 years and am author of “Successful Property Letting” – which has been the UK’s top selling commercially published property and buy to let book for the last 3 years.
At LettingFocus.com, we help landlords and property investors make money in property by coaching them in ways that work, which are ethical and which involve minimal risk to the investor.
We pride ourselves on giving independent unbiased buy to let advice on either a one to one mentoring / coaching basis or through our occasional group seminars.
With no links to property firms, developers or bridging loan providers we can advise on where and what type of property to buy for investment and when to buy it. We also show you how to manage tenants properly.
At a corporate level, we also provide consultancy for banks, local authorities and social housing providers – helping them with their landlord facing or buy to let product strategies.
We also write for property websites and are regularly quoted by the media.
We have written articles for numerous publications including The Independent, The Telegraph and quality landlord websites.

AT OUR WEBSITE LETTINGFOCUS.COM:

THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
ONE TO ONE PRIVATE CONSULTANCY click here: Property Mentoring
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investment Seminar and Networking Event
We have OFFERS on a range of services and products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
For general info on our SEMINARS AND CONSULTING click here: Property Seminars, Networking Evenings and Consulting
TO READ CLIENT TESTIMONIALS – both commercial and private click here: Testimonials
BUY “SUCCESSFUL PROPERTY LETTING” click here: Buy the Book at Amazon plus anything else you fancy at Amazon.co.uk

To JOIN our Free QUARTERLY NEWSLETTER simply send an email to david@LettingFocus.com - Please note we WILL NOT send spam or sell our mailing list to advertisers!

IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR TO OUR WEBSITE?
IF YOU SELL SERVICES TO LANDLORDS, YOU COULD BE A PARTNER ON OUR AFFILIATE PROGRAMME. PLEASE GET IN TOUCH!

See our Twitter page: http://twitter.com/LettingFocus

Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.

Credit Crunch Bites - It's a mad world in buy to let says Lawrenson of Letting Focus

A contact of mine in the north recently became aware of someone who had bought 7 off plan apartments (1/2/3 bed) in a block of 30ish apartments about 10mins Manchester Centre which completed 6 months back for a total of just over £1 million as his first property investment.
No money down, naturally and allegedly 15% gifted deposits from the developer.
The developer promised to pay interest payments for 6 months max, or until they were let, but he cannot now be contacted.
The interest only monthly mortgage payments come to £6000 per month but only three have been let - at much less than what was promised and they are bringing in £1485 per month in total leaving a shortfall of £4515 per month. Ouch!
You have to ask who on earth would lend this man this money on the figures involved - they do not add up whichever way you look at it। It is madness!
More craziness from our financial services friends। When I called in at my local Nationwide -who took over Portman – they said “Sorry, computer says no -we don’t do buy to let mortgages anywhere in the Nationwide group.” Funny that, just the other day I got a call from the Mortgage Works (part of Nationwide) themselves – they are still very much into buy to let. Someone should tell the berks at the branches.

Hapless Housing Association
Also, this week, the hopeless London housing association to whom I let one of my properties on a private lease scheme called me. Their in house boiler people said I would need a new boiler -and it was going to cost me £2600. I got my own man in to fix it – cost £60, which just proves the value of getting a second opinion.
Finally, it continues to look very grim in the financial markets and I feel sure that this must surely spill over into even further tightening on mortgages. Property prices will continue to drift off this year and in a slow market that means there are bargains to be had - though many vendors will no doubt refuse to accept the new reality for a while yet.
I notice that Mortgage Express have raised their margin over bank base rate by another 0.8% above what was available last year.
They appear to have been caught out more than most because they have raised a lot of capital on the money markets using these awful debt instruments.
So, I’ll leave them well alone for now. There should be better deals around. I suggest you go to a good broker who knows which lenders who are less exposed to Le Crunch and who still have decent mortgage rates.
If you need more advice on property investing or buy to let property in general please ask me.
I’m David Lawrenson from property investment advisors http://www.lettingfocus.com/
I’m the author of the buy to let book “Successful Property Letting - How to Make Money in Buy to Let” the UK’s top selling property title.
Buy the new edition here: http://www.amazon.co.uk/Successful-Property-Letting-Right-Plus/dp/0716030195/ref=sr_1_1?ie=UTF8&s=books&qid=1203933977&sr=1-1
It is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on buying below market value. I’m an expert on property investing for profit and a well known property freelance writer and I contribute to newspapers and a host of property websites, write a property investment blog, a number of columns in the press and run a landlords advice service.
I also work as a consultant helping banks, building societies, housing associations and web portals with their buy to let and property products and services.You can read more of my property investment blog and details of my networking, advice, buy to let networking programme at my website http://www.lettingfocus.com/My next London property investors networking meeting is on March 12th. Click here for details: Property Investment AdviceWhat’s unique about lettingfocus.com is that we offer independent property mentoring because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.If a property investment is lousy – We’ll tell you straight and we will tell you all about buy to let and property investment - the good and the bad and we won’t make silly promises that you’ll become a millionaire overnight.Copyright: David Lawrenson 2008. This blog is updated at least twice a week. Permission must be sought before using the material in the blog.

Property Price Forecasts. How Can I Verify If They Are True. Letting Focus Has the Answers

Here’s a trick many property companies promoting off plan property use.
What they will do is sell the first few five or ten units at a low price to get initial finance in. Sometimes these units are sold to other companies that the builder has a “close relationship” with.
Of course, the next lot which is being sold to the public is marketed at a higher price.
They are then able to use the fact that the price “has gone up” in their marketing literature and that investors should “get in quick” before they miss the boat.
Watch out for this trick, which is especially common in property abroad.

ABOUT LETTINGFOCUS.COM

LettingFocus.com are the experts on landlord issues and I’m David Lawrenson, the author of “Successful Property Letting” – which has been the UK’s top selling property and buy to let book for the last 3 years.
We help landlords and property investors make money in property by coaching them in ways that work and which are of minimal risk.

I have been a landlord and property investor myself for over 25 years.
At LettingFocus we offer independent unbiased advice for property investors and landlords both on a one to one mentoring and coaching basis as well as through occasional group seminars.
Property syndicates and property advice in the UK is still largely unregulated and “advice” is more often more about making the promoter money than giving useful information
With no link to property firms, developers or bridging loan providers, at LettingFocus, we aim to give unbiased independent advice on where and what type of property to buy for investment, when to buy and how to buy property at a low price.
We also show you how to manage tenants properly and in ways that take up as little of your time as possible.

CHECK OUT THESE PAGES AT OUR SITE LETTINGFOCUS.COM:

THE HOME PAGE OF THIS BLOG click here: Blog
THE HOME PAGE OF OUR MAIN SITE click here: LettingFocus Home Page
NEXT SEMINAR AND NETWORKING EVENT for Landlords and Property Investors:
Next Property Investing Seminar and Networking Event
We have GREAT OFFERS on a range of products for landlords too; click here including landlords insurance, tenant referencing, tenancy agreements and more: Services and Products for Landlords
For general info on our SEMINARS AND CONSULTING click here: Property Seminars, Networking Evenings and Consulting
ONE TO ONE PRIVATE CONSULTING click here: Property Mentoring
CLIENT TESTIMONIALS from past customers click here: Testimonials
BUY THE BOOK click here: Buy the Book at Amazon

To JOIN our Free QUARTERLY NEWSLETTER simply send an email to david@LettingFocus.com - Please note we WILL NOT send spam or sell our mailing list to advertisers!

IF YOU HAVE A SITE WHY NOT LINK TO THIS BLOG OR OUR WEBSITE?

Selling services to landlords and property investors and have a national coverage? You could be a partner, please get in touch!
Copyright of Blog: David Lawrenson 2009. This blog is updated roughly once a week usually on a Monday or Tuesday.

Have you seen this article on a related topic: Buying Below Market Value

TO VIEW RELATED POSTS select a “Category” at the bottom of this page.

WANT TO ADD A COMMENT OR VIEW OLD COMMENTS?
To add a comment or view other people's comments on this post, simply click on “link to this post.”
Copyright: David Lawrenson 2007