The Risks Of Investing In BTL
February 22, 2009 by
There have been mixed messages about the state of the UK buy to let market or BTL as it is often known. Historically the buy to let market has been relatively profitable during times of depression and recession.
Investors who have bought properties at property auctions at too high a price can often panic as mortgage rates rise and start to try and sell off their investments. This can cause the market to become flooded with flats and small houses. As fewer people are buying during a recession a large pool of unsold properties begins to accumulate.
The big auctions like the property auctions in the north west can last for several days, the number of lots being so large. However this glut of property is always temporary.
The UK is an island with limited space and property is always in short supply. After the initial panic the truth is that people will always need to move because of changes in their lives be it changing jobs or getting divorced. If they can’t afford to buy then they will need rented accommodation.
This time round BTL investors have been lucky in so far as the mortgage rates haven’t spiraled upwards out of control so that the mortgages on their investment properties can still be covered by the rents they receive.
You can find out more about buying at auction at sites like Property Auction Database which list auction houses from around the UK. By learning how to buy properties at their lowest prices you can greatly cut you financial risks when property market slumps occur.
The recent events have served as a timely reminder about investing wisely. Too many inexperienced investors purchased one or more properties at high prices using the minimum deposit and borrowing the maximum possible. This is great when the future looks rosy but can be financially ruinous if things falter.
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The United Kingdom is unique, and is a country itself-scotland, england, wales and northern island are not governed independantly, and so on a global level are not considered as individual countries in their own right, for anything other than when considering their respected traditions. We united to form one large country/constitutional monarchy many years ago, so it is perfectly acceptable to say you visited the UK for your holiday. Since the UK is so small when compared to other countries, the countries that make it up are often considered as the equivalent of the US and its states. Its no different to saying 'I visited the USA for my holiday' – so yes, theres no problems there other than the fact that you are being very general, and may then be asked questions regarding exactly where you visited within it! If any nationalists are offended by your reply of 'UK' instead of 'Scotland', 'England', 'Ireland', or 'Wales', then they may simply be people to avoid talking to altogether!
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the UK is only England wheras GB includes England, Northern Ireland, Wales and Scotland.