Podcast Summary
Is the property market experiencing a boom?: One lender's proposal of 100% mortgages for first-time buyers might not signal a property boom due to its affordability ratios and eligibility restrictions.
While the announcement of 100% mortgages for first-time buyers by one lender has raised questions about the potential start of the growth stage in the 18-year property cycle, Rob and Rob believe it's too early to call a property boom. The proposed product, as it stands, is sensible due to its affordability ratios and restrictions on eligibility. Additionally, other similar products on the market require a guarantor, limiting the number of applicants. Overall, this product could help those struggling to afford homeownership without contributing significantly to a property market boom.
Mortgage market changes and housing boom warning: While mortgage market shows signs of change, a housing boom is unlikely due to past lessons. Keep an eye on 18-year property cycle and tenant rights before purchasing tenanted properties.
While there are signs of potential changes in the mortgage market, we are not yet at the point of a housing boom, especially given the lessons learned from the last one. The possibility of 100% mortgages with bad credit, or even mortgages with good credit exceeding the property value, could trigger a boom if reintroduced. However, we are currently far from that scenario. Another topic to keep an eye on is the 18-year property cycle, with significant updates coming soon. For those considering purchasing a tenanted property, it's essential to understand the current legislation regarding tenant rights and the potential implications for new ownership. If a tenant is not paying rent, it's crucial to seek professional advice before proceeding with the purchase.
New owner takes over tenancy agreement with existing tenants: When buying a property with tenants, factor in time and costs to resolve any issues beforehand or budget for a longer wait before getting new tenants in.
When buying a property with existing tenants, the tenancy agreement transfers to the new owner. This means that if tenants are not paying rent, it becomes the new owner's responsibility to evict them. The process can take several months and may involve legal action and potential damage to the property. Therefore, it's crucial to determine the tenancy end date and factor in the time and costs required to resolve any issues before making an offer on the property. If the tenancy is ending soon, the resolution process may be quicker, but if it's not, the new owner may need to budget for a longer wait before getting new tenants in. Ultimately, the new owner should aim to compensate themselves for taking on a potentially problematic situation.
Considering a complex investment or deal?: Do thorough research, understand details, weigh pros and cons, and make informed decisions before committing to complex investments or deals.
If you're considering a complex investment or deal, it's crucial to do thorough research and understand all the details before committing. The potential rewards can be significant, but the risks and complexities are also increased. It's essential to weigh the pros and cons carefully and decide if the added complexity is worth it for you. Some people might prefer simpler investments or opt out altogether. However, if you do decide to pursue a complex deal, make sure you're well-informed and prepared. Stay tuned to our podcast for more insights and expert advice on navigating complex situations. Our upcoming episodes promise to deliver some of our best content of the year. Remember, knowledge is power, so make the most of it! As always, join us for Ask Rob and Rob next week for more valuable insights. Until then, take care and have a great week!
