| Dear Investor,
There has been some encouraging news recently concerning the UK property market. The news can be summarised as follows:
- An easing of credit markets (possibly the bottom of the “Credit Crunch”)
- An increase in mortgage lending, albeit from a smaller base
- More competitive mortgage products
- A substantial fall in LIBOR
- Estate agents reporting that enquiries are now turning into sales
- The rate of decline in property prices in England in Wales is at its slowest since February last year
It’s early days, but combined with the positive news from the US, then we may not be too far away from a bottom. I think that the US recession will probably bottom in Q3 or Q4 2009 and in the UK a return to growth up to 6 months after the US.
Forecasting is like trying to predict the weather in the UK. However, whether I am out by a quarter here or there does not matter. You have to look at the overall picture, based on the latest data.
Barring a confrontation with North Korea, Iran or some other significant geo-political event, the effects of global interest rate cuts and the coordinated fiscal positions of the major trading blocs will continue to have an impact.
I think the window for significantly undervalued deals in the UK is narrowing and will continue to do so as the news becomes more positive and those who have been sitting on the sidelines re-enter the market, particularly as mortgage products continue to improve.
We will also see investors who are receiving a negative return on cash deposits and losses from the stock market enter the fray.
Whether we will see a classic V shaped recovery or a more flattened U shaped one is irrelevant, as those who invest now in distressed assets will see substantial returns going forward whatever the timeframe.
If you wish to find out more on how you can invest in UK bank repossessed properties with strong cash flow and substantial reductions on open market value, then fill in the form at www.distressed-assets.co.uk and we will call you back. It is the distressed assets route which will provide the substantial returns, not the estate agent route.
Alternatively, we have a seminar in London next week at 6.30pm Tuesday 21st April 2009 where I will give the macro-economic picture and Henry will detail the type of property we target and the criteria we use to determine value. We will have the opportunity after the seminar for a more informal chat over a drink. An exciting year ahead for investors – don’t miss out.
Best wishes
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