Interest rate rises are a long way off say the analysts. They expect as a minimum rates will be held to 0.5% till end of next year. I hope they are right!
Now I do not wish the recession to last but it is hard not to. Especially when you are a highly leveraged buy to let investor.
So if you are wondering where to get deposits or fees for your next purchase then save up, as you have no excuse now!
My mortgages have reduced from £40k a month to £20k a month. Some of my fixed rates expire in 2009 and the last lot expire in June 2010. This will mean my mortgage payments will go down to around £15k per month.
With rents going up to the LHA rate you could say my monthly P&L is quite healthy! These interest rate reductions have really helped out.
Like the buy to let king from the Property Watch programme said this time the government came in to the rescue. Unlike the big crash pre world war 2 where the government did nothing this time the bank came in, slashed rates printed money and kicked the FSA in to gear!
So I am still waiting for the smack on the back of the head (which will be inflation) to cancel out all these good times. No smack yet. We just have to buy as much as we can while prices are low and we have the cash to do so.
Problem is there are more buyers than sellers so bargains are going lightening quick. With my team of sourcers we are still losing deals. Can you imagine what chance a one man band or first time buyer gets? Very low. Too many professional buyers out there.
We may see the refurbish property ladder sarah beeny wannabees brigade appearing willing to take a longer term punt. i.e. buy now, complete in 12 weeks, refurb in 12 weeks, get 6 months council tax exemption and put up for sale for when the market recovers and hold out for a sale in early 2010.
Anyway enjoy this TWO year period of low interest rates. I have seen residential rates at 2.4% so you
can enjoy them even if you are not on the property ladder yet.
Posted on: 15th May 2009