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articles > Is the Worst of the Credit Crunch Over?
Article> Is the Worst of the Credit Crunch Over?

Article kindly supplied by Alan Forsyth

Property Investment Tips
53 Crusader House, Thurland Street, Nottingham, NG1 3BT

Hi, Hope you are well.

Last week, a massive step was taken with a lender going back towards the higher LTV lending, with an 80% LTV product for buy to let. This is yet further evidence that the mortgage market continues to recover and with 2 lenders due to enter the market over the next few weeks, the future for buy to let investors is bright!

Since the credit crunch, buy to let mortgages have been generally limited to 75% Loan to Value with only the most straight forward, low risk applications succeeding at this level. Many portfolio landlords have been unable to expand as they have already reached their maximum with the mainstream lenders and will welcome the news that alternative options at higher Loan to Values are becoming available.

So overall this seems a good thing?

Well two ways to look at this - it certainly shows the lenders have similar confidence in the market to myself and many other investors ie prices have stabilised, and as we have seen have managed to rise even without much lending out there! As long as the properties they lend on have a strong rental coverage ie generally properties under £100,000, then the lenders should be fine to lend.

As stated previously, I do not expect prices to rise greatly over the next 5 years - there is no economic reasons for this to happen, but prices should certainly continue to rise by 3-5% each year. This will all depend on the LTV and criteria of lenders. When buy to let lenders went from 85% LTV to 75% LTV lending, desperate vendors had to offer their properties at 25-30% discount instead of 15-20% to secure a sale to investors.

While this reduced the numbers of willing vendors, it meant those investors who could get finance were able to secure fantastic deals, which will stand them in good stead for the rest of their lives. This continues to be the case now with us securing deals for both ourselves, as first and foremost we are investors ourselves, and for our investors at 25% below current RICs valuations. Gaining a genuine £20,000 of equity on day one, allows you to secure an excellent pension for yourself - with some investors buying as many as 5-10 properties for very little money.

To enquire further, and receive our free copy of “7 Fatal Mistakes to Avoid as an Investor” sign up here


It is clear to say that the worst of the credit crunch is over now, which for me means that the next 6-9 months are a crucial time to get the best property bargains. Why you might say if I don't expect prices to rise much overall over the next 5 years, well as mentioned above the biggest bargains are decided by the LTVs available, and with LTVs rising this could well mean the value of the distressed properties will rise as well.

For now we want to make the most of the fantastic opportunities!

You can go and see any of the properties or areas we target, with South Wales, Scotland, Hull and the NE all being excellent areas for us and our investors. We have anything from 15-20 reservations every week with investors from all walks of life, and all around the world buying just now attracted to the best buying opportunities in the UK for the last 5 years!
All these properties are in some of the most affordable areas of the UK so they have strong potential to rise in value, and then they are coming with 25% of equity!

In terms of the areas we recommend these are not meant to be the areas you aspire to live in, they are simply vehicles to build wealth - I know many millionaires living in Surrey or the South coast who have portfolios of 50+ properties in the North of the country, living where they choose, and investing where they see the best cashflows and affordability. The golden rule is always do not invest with emotion - this is where many thousands lost out buying city centre apartments that were never going to cashflow, just because people invested with emotion instead of a business head ie they thought they were "nice" properties without understanding the numbers. With all our deals we invest with the numbers, not with emotion!

If you would like to form a strategy to suit your own personal situation, then we would be delighted to discuss with you on a One to One basis either over the phone or face to face. To arrange a consultation, you can call us on 0115 9853963

Hopefully this can help you understand why below market value property in the UK is such a fantastic opportunity right now! These next 6 months are a fantastic opportunity, make sure you do not miss the boat!

To enquire further, and receive our free copy of “7 Fatal Mistakes to Avoid as an Investor” sign up here

Regards Alan


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