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I think the article missed a bit

One bubble ready to burst is the ready made armchair investor packages scam by new build developers and unscrupulous agents.

Apparently companies have been offering new build flats with fake discounts and all inclusive management packages.

These have left investors with negative equity compounded by such poor rental returns that mortgage payments require subsidies. (Panorama Buy to Debt)

This combined with the credit crunch and the market downturn will leave a bitter taste for many an amateur investor who was scammed on the back of a dream to fortune and freedom.

I have noticed for the past two years whenever I negotiated a genuine price reduction I had to sign a statement that I did not belong to a property investment club.

I think troubled times ahead especially for the inexperienced and the newbies.


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I have to agree with Oliver on that one.

The thing that gets me is that it doesn't get a lot of press. It doesn't take long time figure out why either, all these people pay loadsa money to papers to advertise, all you see in property sections of papers is new build flats at mythical prices these days.

It is so widespread as all of the middlemen are part of it. The Surveyors really need to be kicked in the guhonours as they should not be valuing these properties so highly. The lenders should also not be so stupid.

The only place you see much of the problems of the new build flats are on the internet.

I really think that they are selling flats for about 300K when they are worth 200K at best. This for me is fraud on a big scale and the government needs to step in. What it means is that the owners try and hold out for an unrealistic rent, they end up letting and making a big loss pcm. A year down the line they can afford it no longer and have to sell, evicting tenant and in negative equity. So tenants mucked around and property empty probably for about 50% of the time. This does nobody any good other than the developers and all the middlemen.

Anyway my rant over for the day, I feel better now :-)

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Personally i would steer well clear due to lack of control ....management policies, services charges etc.

It is also interesting to note that several blocks of "luxury apartments" in Cardiff are full of noisy students, asylum seekers and HB clients which is doing no favours to the private LL who is desperately trying to either rent or sell ....


The next 12 - 18 mths will certainly sort out the "men from he boys"

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The article seems to be missing a valuable point... So the credit crunch leaves potential new home buyers sitting it out waiting to see how things pan out, which could be some time, in the meantime they continue renting....! So whilst not being a good time to sell, perhaps shrewd long term BTL investors could swerve the downturn, make the most of their portfolios, and bearing in mind an inevitable future upturn, pick up the odd tasty bargain on along the way! Also, contrary to this article, some reports suggest lenders still see BTL as a less risky bet... Interested on your views - See articles below:




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