Is Now the Wrong Time to Buy Property in the UK?

Is Now the Wrong Time to Buy Property in the UK?
The global financial World is in a state of more turmoil
than most people can ever remember seeing. The rumours of a
UK property crash are abundant and many people are rightly
asking, "is it the wrong time to buy property in the UK?"

But are we really on the verge of the property market
crashing down around us?

This article will explore what's currently happening in the
financial market and whether now is the wrong time to be
buying property in the UK. The goal is that by the end of
it you will have a better understanding of what is really
going on and how you can still make money in this or any
other economic climate.

What's happening in the financial markets around the World?

The speed and the depth of reach of the fall out from the
sub prime financial crisis in the States has taken many
investors and financial organisations by surprise. Many
people knew that the stability of the US economy had far
reaching implications for the rest of the World, but just
how far, is only just becoming apparent.

There has been a panic amongst lenders in the UK and a
reluctance to really admit how hard they have been hit.
Banks are becoming suspicious of each other and we are in a
situation where they are no longer lending to each other as
freely as they used to.

All the big lenders appear to have been hit heavily. Some
of them are now admitting it openly and asking for help
from shareholders while others are determined to try and
put a brave face on and try to brave it alone.

The Bank of England is desperate to keep the mortgage
market stable and the economy going forward. There is
confusion within the Bank of England as to what is the best
way to achieve this, but as a result of them knowing
something has to be done, they have decided to make 50
billion pounds available to try and help curb the problem.

One thing that has become clear is that many financial
organisations seem to have been run with very little
financial savvy. Criteria that have been set in the past
for lending purposes seem to have gone out the window and
one has to ask oneself, on what basis where they set in the
first place?

On the whole, 100% plus mortgages seem to have been
abandoned. Big players in the buy to let mortgage market,
such as Mortgage Express, have pulled key products, such as
their same day remortgage product and are now insisting
investors have had their property for at least 6 months
before being allowed to remortgage.

Many property investors are now finding it difficult to get
mortgages at rates that make purchasing property
financially viable.

Surveyors seem to be running around like headless chickens,
not really having a clue how to value properties in the
current climate. While they where confident of their
valuations in a more stable market, bring in a little
instability and their valuations seem to be on shaky
ground, with each surveyor looking over his shoulder and
being scared to overvalue properties, hence many times
undervaluing them.

Off plan property investors are being especially hard hit
since surveyors are being particularly caution with
anything that it is difficult to get comparables for.
Properties that where bought off plan 18 months ago are now
coming to completion and are not worth what they where
projected to be worth.

The fragility of the lending World and how it operates has
become painfully apparent to all.

Should you abandon the idea of buying property in the UK
altogether?

Good question. And with the speculation of a UK property
market crash, it is a question that many investors are
asking. However, astute property investors don't get
caught up in speculation. They know that if they can buy
below market value property in a given location based on
local affordability and a good rental yield, then they will
be fine.

They are confident that if they can buy these properties
for around 4 times, or less, of what the local average
salary is and they can manage to get a reasonable rental
yield, then long term they are onto a winner.

However, if you are looking at buying in areas where the
property prices are 7-10 times the local affordability then
you are potentially on shaky ground.

These are great learning times for the positive thinking UK
property investor. For the next few years you probably
won't be able to complacently buy a property anywhere in
the country and just expect it to rise in value. Now, is
the time when you have to learn your craft properly. It's
time to go back to school.

For the investors that understand the property and
financial markets, and learn how to work with them in any
and all conditions, then the next few years promise to be
times of learning and expansion, not contraction. Yes,
there are difficult times a head, but out of huge
challenges can come tremendous growth.

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Do you want to learn more about how to make money from UK
property investing and buying overseas property? Then
visit the http://www.investment-property-guru.com website
for invaluable tips and advice that will help you succeed
in today's property market.