Charles of Dawson & Associates has previously raised his concerns about projected rental yields.
Having been involved in the UK property industry since 1970 (frequently advising portfolio managers with regards to Buy-to-Let investments) he has warned a cautious approach to property investment returns that initially appear large but, in truth, only reflect the current low interest rates. This is an opinion shared by many other property industry professionals and savvy investors who have also witnessed a volume of individuals releasing pension funds to take advantage of this apparent opportunity. An occurrence that could result in an inflated and volatile market, removing first-time buyers from the equation.
With 40 years of property experience, Dawson has seen it all happen before.
And it is a point well discussed in Simon Watkins' article in The Mail on Sunday...
"It seems that we are suddenly a monopoly-playing nation divided into two tribes: those who have a gleaming, shimmering BTL property and those who do not."
Those 2 million private investors who have ventured into the BTL territory are apparently identifiable by an inherent smugness only achievable by those who have done very well. But Watkins and Dawson agree, once the smoke clears, the mirror may reflect quite a different expression. Because the bank rates are expected to go up
– what will happen to vulnerable landlords then?
Watkins hypothesises that with a rise of just 1%, rental profits could easily be wiped out entirely. Should interest rates rise further, the new landlords will soon look to sell which could flood the market with an excess of properties, leading many into negative equity.
Dawson states that this is just another example of where solid professional advice should be sought before a commitment to the investment is made. The property market does tend to have a cyclical nature so those who have been working in it for many a year, are likely to have seen similar circumstances. A true case of "invaluable experience".
As a chartered surveyor Dawson can assess the condition of a property and therefore judge its purchase potential. But it is the working expertise of UK and international property development, construction, leasing and sales that will provide a well-rounded prognosis of what the future may hold...
Charles of Dawson & Associates works with highly qualified, senior personnel who are members of the following institutions: • RICS • ASI • CIOB • RIBA • I of C Mgrs • FPWS • CIBSE
Please feel free to contact Charles or any other member of the Dawson & Associates team for instant survey quotes or property advice. Initial consultations are free of charge.
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