Welcome to your new monthly newsletter!
By Louisa Fletcher

As an introduction to this newsletter (and the ones to come in future!) I thought it would be a good idea to explain to you how I’ve ended up working with Jim Moore and the rest of the team at IAP Global at this pivotal time for the company.

I first met Jim over a year ago when I interviewed him for an article I was working on about property investment clubs. I’m not really sure what I was expecting to find, but on meeting Jim in person, he certainly blew any pre-conceived ideas I had out the window! We talked at length about his desire to help other people achieve personal wealth via investing in property and how his own journey had led him to develop a business that would support people to do just that.

I’ll admit that, initially, I was a bit sceptical, but the more we spoke, the more I realised, here was an ordinary guy who, in the nicest possible way, had been around the block and taken more than his fair share of hard knocks. I asked him some pretty awkward questions, but he in turn, always answered me truthfully and in detail.

After that, Jim and I spoke regularly – often, I’d ring him to ask him to comment on the market or perhaps just to see what was going with his business and how he was finding things. Inevitably we’d have a stimulating conversation, which would challenge my previous perceptions in a positive way, and often make me re-address my initial point of view.

Jim recently approached me with the idea of me working with him to make the business more customer-focussed. Initially, I declined. Then I thought about it for a while. Here I am, a journalist committed to working wherever possible in the best interests of the consumer, and here is a man looking to engage with his customers and make his business better, for them. What’s not to like? We met and talked again, and I accepted his offer to work with him to try and add value for you, the members, by speaking at seminars, writing newsletters and articles for you and also getting involved in the customer care side of the business.

Jim is as committed as anyone I’ve met in the last few years to making sure that, even though he can’t control the property market, he will do whatever he can to protect his clients’ investments going forwards. He’s putting his own money into the business, and that, for me, says an awful lot. To ‘put your money where your mouth is’ these days is a pretty bold statement.

I’m really excited about working with the team here and, more importantly, looking forward to getting out and meet you at members events in the next few months. I hope I’ll be able to offer an independent viewpoint on both the UK and overseas markets, which together with information provided to you from IAP Global and your own research, should help to inform you and enable you to benefit in the long term from investing in property.

Look forward to seeing you soon!

The Sooner the ‘blockage’ is cleared, the sooner canny investors should start buying again

Wow, what a couple of days we’ve had! I have to say, I wasn’t expecting a 1.5% cut – I don’t think anyone did. But extraordinary times call for extraordinary measures, and I would suggest that this is a measure of the unprecedented market turbulence we’ve seen over the last year, that has been as unsettling for industry professionals as it has been for UK homeowners and investors.

“The first glimmer of hope is returning for the housing market”

But, as I write, it seems the first glimmer of hope is returning. The Chancellor has called all the lenders together for a ‘little chat’ over breakfast this morning to tell them in no uncertain terms that the have to pass the rate cut on. Of course, some are already obliged to do just that – under the terms of their £37billion government bail-out, they have to pass rate cuts on to the taxpayer. So for the likes of Bradford & Bingley, Northern Rock and the Royal Bank of Scotland, there won’t be any wiggling.

Other lenders have also tossed their hat in the ring by passing on the cut to their existing customers – HSBS were, as of Thursday afternoon, offering a 3.99% Tracker deal to new customers, with existing borrowers rubbing their hands in glee at the massive reductions in their mortgages which have been passed on immediately.

But the real indicator though that confidence is returning is LIBOR – the London Inter-Bank Offered Rate. In other words, the rate of interest banks charge each other to lend money. For the last twelve months or so, since this whole credit squeeze started, there has been a large gap between the BoE rate, and the LIBOR rate which explains why, even though interest rates have been, in the grand scheme of things, reasonably low, mortgages have been expensive and tricky to get, especially for buy to let investors.

The LIBOR decision, which has literally just been announced as I write this, shows a reduction from 5.56% to 4.49%, which indicates that the lending fraternity are finally a bit more confident (along with having their arms severely twisted by Mr Darling). This will be a blessed relief for us all. And once the ‘blockage’ has cleared, it’ll be easier for anyone looking to secure a mortgage to have a sensible discussion about borrowing. And what a window of opportunity that will bring with it

“Nearly half the normal amount of property transactions have taken place so far this year”

Why? Well, many people have put off buying in the eighteen months. Nearly half the normal amount of property transactions have taken place so far this year alone, according to Land Registry figures. And for the average first time buyer or family who are also feeling the pinch having seen their living costs rise dramatically over the last few months, even though mortgages might be increasingly available (and hopefully, after yesterday, cheaper) over the coming months, it’s going to take a while for confidence in the UK housing market to become buoyant enough that the average first time buyer or owner-occupier will take the jump and seriously consider buying again.

“...the right time to add to your property portfolio could be just around the corner.”

However, if you’re an investor, this represents a golden opportunity as, if you are smart about what you buy and when, you’ll be able to take advantage of the raft of deals that lenders will inevitably have to launch soon in order to get business through the door – and also, because Gordon says that they have to! – yet be able to pick and choose from property on the market at a lower price than we’ve seen for the last few years.

Of course, eventually, given a year or so, demand for property will rise again, and because finance will be more available, we’ll see prices stabilise, if not increase in some areas. But, for investors who are, like me, confident in the long term prospects for the UK housing market and happy to sit it all out for five or even maybe ten years, the right time to add to your portfolio could be just around the corner.

News in brief

Don’t forget, as of October, Landlords advertising property for rent in the UK will need an Energy Performance Certificate prior to putting the place on the market. Costing between £50 and £250, depending on the type and size of property, your letting agent should be able to organise this very simply for you at the same time as arranging all the other paperwork involved. If, however, you want to make your own arrangements, shop around by all means to get the best deal, but do make sure that your EPC provider is a member of Property Codes Compliance Board (you can check for a list of firms in your area by logging on to www.propertycodes.org.uk). For more information on EPC’s in the rental sector, go to www.direct.gov.uk/epc.

Which gold-winning Olympian is spending his hard-earned endorsement fees in overseas property investments in Brazil? I couldn’t possibly say, although I can tell you this person is wisely looking at the Natal area, famous for its beautiful beaches, vibrant nightlife and laid-back vibe. And with Brazil - home of Pele and ‘the beautiful game’- hosting the Football World Cup in 2016 this switched on ‘super-athlete’ is sure to get a great return on their investment....

According to the most recent Nationwide House Price Index, although property values in the UK were down in October by 1.4% on September, this is around the same rate as the average monthly fall over the last twelve months (1.3%). According to the Nationwide, the average UK house price is now £158,872, down £30,000 on the same time last year, but still almost £30,000 more than five years ago. Which proves the point that, if you’re going to invest in property, you need to be in it for the long term!

The IAP Global Newsletter is for general information only and is not intended to be relied upon by readers in making or not making specific investment decisions.

Disclaimer

Comments made are based on current tax law and may, (in fact almost certainly will), change in the months/years ahead. Material supplied has been carefully checked for accuracy but no responsibility can be accepted for inaccuracies or errors or from subsequent use of this material. Specific professional advice must always be sought based on your own individual circumstances. As always, the buck stops with you. We recommend you take independent advice before making any such decision.

The writer, IAP Global Newsletter and associated companies, do not accept any responsibility for any loss suffered by readers as a result of any such decision.