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Buy to let investors (who love a bargain) will be happy to know that over a third of the properties currently up for sale have had their asking prices reduced in recent weeks. As an investor, you should be positioning yourself to make the most of the emerging opportunities in the market.
With Rightmove producing statistics that indicate over 36% of properties have actioned a reduction, with an average reduction value of £22,700 across the UK. Whilst Scotland’s market remains stronger than the rest of the UK, there is still a favourable environment for investors to secure a property at a lower price right now, potentially enhancing the return you may get in the longer term investment choices.
Advantages of Buying During a Market Price Reduction
More affordable prices means that you can access properties that were potentially ‘out of reach’ previously.
An opportunity for potential capital gain when the market recovers
As your initial investment is lower, this will allow for a more favourable return on your property investment. Market price reductions can result in higher rental yields. It is anticipated that rental costs are going to continue to steadily increase.
Bank of England Base Rate Retained
The Bank of England’s decision to retain the current base rate will play a significant part in the current market. This encourages lenders to provide better interest rates, potentially lowering the cost of borrowing and allows you to adopt a larger range of investment strategies.
Considerations
Market Research
Get to know your market! Or get in touch with someone that knows ‘your market’ and is able to identify the areas with the highest potential for growth and appreciation.
Financial Risks
Assess any risks and develop a strategy to minimise any potential risks. OR, why not consider an ‘Asset Backed Investment’ with Murray Property Holdings.
Property Reductions
Some computer savvy investors might be already using the The ‘Property Log Chrome Extension’ which allows you to see price increases and reductions, to help you negotiate a better price for your investment property.
*Image above using the Property Log Extension whilst browsing on RightMove. This particular property shows a 20% reduction in price.
It can also work the other way around – you can also view what has been increased, this means less potential buyers are going to be viewing the listing (due to the higher price) but you can negotiate it back to less than £60K because you know that £60K is all the seller wanted initially. If the seller has had it listed for over 6 months, they are now a ‘motivated seller’ and you might be able to negotiate less than the initial £60K price.
What we do know is that Scotland’s property market is dynamic and current trends suggest that now is an excellent time to dust off your property wallet…..
Get in touch with our friendly team for a chat about everything property!
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