Well it’s the first blog article of the year 2012: the year that will see the Olympics come to London, the financial markets starting to repair themselves after the biggest downturn of modern times and, of course, the diamond jubilee of Queen Elizabeth II. We’ll have more on the Olympics later in the week, but what are the prospects for landlords in 2012?
The Housing Market
There have been many conflicting reports surrounding the housing market lately, some saying they expect growth in prices, others predicting falls: all that it’s safe to say really is times are uncertain. The basic economic equation of supply and demand still applies in this instance and in the UK, demand far outstrips supply, and it’s fair to say that long term prices are likely to rise. The short term, though, is anyone’s guess!
Many agencies are predicting a change in the way the UK property market runs and 2012 might see the first signs of a change towards more rental property. On the continent it’s considered far more normal to let property long term and attitudes in the UK are starting to turn that way. All in all it’s good news for you if you’re a property owner: longer term lets are more secure for your income and you’re likely to see yields rise.
The one thing we can be fairly sure of is that there is still a large price to pay for the recession in terms of rising unemployment and rising inflation. Quantative easing is predicted to move things along a little around February time but it’s still hitting many tenants and many landlords very hard. Your Rent Guarantee Insurance is going to be just as useful in 2012 as it was in 2011.
It looks like an uncertain year ahead for landlords but the long term prospects probably look better at this point than they did this time last year. It’s fair to say that researching the markets well, thinking hard about your yields and pricing, and being prepared for the worst should be top of every landlord’s New Year’s resolution list.