We Know Property

As the credit crunch tightens its grip UK house builders are feeling the pinch with almost 70% of the 6 biggest house builders price value being whipped on their collective share value. But what does this mean for UK property investors?

Very simply it means stay away from new build property, especially long off-plan property in the UK. Buying off plan property is a risk and with the current economic doom and gloom there is a significant chance UK house builders could go into liquidation. For property investors this means stay away from new build, its over priced and much better investment buys can be had in 2nd hand stock. not only are prices lower but yields are higher and if you search hard enough you can find positive cash flow property, but it certainly wont be new build property.

The metro reported today that Taylor Wimpey is ‘reportedly finanising an emergency multi-million pound fund raising plan as it suffers in the face of a property slowdown.’ Yet more evidence that buying this type of property in the current UK market is fraught with danger and buyers should be looking at better alternatives. Taylor Wimpey lost its place in the FTSE 100 index in March this year as shares have fallen to about a tenth of what they were worth this time last year.