Despite Much Negative Deliberation, Cash Buyers Seem to Increase

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The property market has been the target for abuse and misuse as much from afar as internal. Although not always legitimately, mostly with total justification, an opinion supported by most estate agents in London.
The logical criticism levelled at the different Government 'help the buyer at all cost, even the Country' schemes seem to have fallen on deaf ears, because one of the seemingly infallible strategies that governments play, is to pretend long enough it is not there and eventually it will just go away by itself.

Even if, or because it does not go away, by the next election we will be voted out, the buck will have been passed and we will no longer be accountable.
That view has been aired on this blog a few times and will possibly be done so some more, however, we have learned from an informed source, no less than Doug Crawford, CEO of the largest provider of conveyancing services in the UK, that cash buyers are without any doubt, on the increase, which is marvellous news for estate agents all over London.

RESEARCH INDICATES PEOPLE BUYING WITHOUT A MORTGAGE IS STEADILY RISING    

Their recent findings indicated nearly 25% of their clients were cash buyers, emphasising that bricks and mortar still offer investors a safe haven for their investment money and a better opportunity for estate agents in Islington and Bethnal Green.
Doug explained as follows: "As the largest provider of conveyancing services in the UK, we are well placed to spot the trends within the housing market. Since 2010 we have witnessed the number of people buying without a mortgage steadily increase. In 2012, 22.5% of our clients were cash buyers, investing an average of £185,000 in property outside of London and £240,000 within the capital. Early figures for 2013 also show similar results." The last fact being so new is a definite boon to estate agents at Nelsons Property in London.
One has to consider other supporting facts as well, before the recession you could expect to earn between 5.25 and 5.75% on your savings thanks to higher interest rates and then, enter the recession and our Bank of England decided they will force the base rate to 0.5% and keep it there and now savers not only struggle to find a decent return on their investments, they are in reverse gear, after charges they have to pay in.

A VIRTUAL NEGATIVE RETURN ON SAVINGS, WHILE PROPERTY VALUES INCREASE

Another fact repeatedly addressed on this Nelsons Estate Agents' blog has been the unnatural growth in property prices, not necessarily 'value', due to all the 'help u buy to make you landlords' support schemes that have driven the demand for properties through the roof and with it an artificial increase in prices.

A small calculation proves how much better 'own-to-rent' (Government supported) purchases are than any present attempt to save cash.
The out of London average purchase price is given as £185,000 for a 3 bed room house and the average rent for that given property will be £670 pm. That will amount to an annual return against purchase of nearly 4.5% which means their cash into property works for them in difficult times.

To prove the point, almost all of the landlords (93%) that took part in the PRS Trends survey, specifically commissioned by the specialist 'buy-to-let' lender (even the reason for the problem agrees happily, of course), said that tenant demands were in places stable and elsewhere growing, which will be a plus for houses to rent in Islington.