New-Builds - Where Next?

Knight Frank's 2011 Housebuilder Survey suggests that, in terms of an overview of the coming years, less than 50 per cent of the number of homes that need to be build will actually be built.

Housebuilders suggest that three and four bedroom houses will be the most in-demand and developments, in terms of units per development, will get smaller.

'In 2009, the sluggish land market struggled to recover from the downturn. In contrast, 2010 has seen the more enlightened housebuilder focus on the better sites with quality housing product in a defined and active market place.' Good news for supply-demand investors!

Land Banking Lowdown

If you've been offered any form of UK land banking deal, the advice is simple. Don't. I've seen 1,000's of these over the past five to 10 years in particular and I've never seen one that stacks up.

Don't take my word for it. It's reported that the FSA has started High Court proceedings against land banking operators who, the FSA says, have scammed investors out of £45 million. It's big business, this land banking. Jonathan Phelan, head of retail enforcement at the FSA, adds, "Certain land banks are becoming more and more criminal in the way that they operate."

I'd say the scammers are becoming more sophisticated - more to come on what they are doing soon. Mind you, I'm not sure they always need to be too sophisticated as there are, excuse me, some seriously stupid people out there who simply don't do any research at all. One of the land banks that is part of the High Court action has no access at all. Another is on a 45-degree slope. Another reminder, if it's needed, to visit what you are buying into.

Property Hotspot Revealed

If you are looking for a property hotspot, check out Cambridge. According to the quarterly housing market bulletin from Cambridgeshire Horizons, the average price of a property is £339,000. That's £98,000 higher than the average price in the surrounding region and represents a rise of £30,000 in one year.

Stewart Chipchase at Savills is quoted in the local press. "I would be very disappointed if there was no offer on the table after three or four weeks in Cambridge. We find up to 70 per cent of our buyers come from London or beyond, including people from overseas. The schools are a major feature, as is the lifestyle and the commutability into London, the science park and business park, and the university, which is a massive employer."

HMO Heads-Up

If you invest in HMO properties, or are planning to do so, talk to your local authority asap. Talk about inconsistent approaches by different authorities! The British Property Federation (BPF) is quoted today as saying that restrictions are 'popping up left, right and centre.'

Ian Fletcher at the British Property Federation says, 'HMOs are already in short supply and are likely to come under increased pressure as thousands of 25 to 34 year-olds search for somewhere to live after the housing benefit cuts come into effect.'

'The government's policy on housing for young people is wholly contradictory at present. On the one hand the government wishes to change housing benefit payments to encourage up to 88,000 young people into shared accommodation. On the other hand, local authorities up and down the country are increasingly blocking the provision of houses in multiple occupancy without having a clue whether they need more shared homes or not.'

I've just read a report which suggests that new HMOs are restricted in Bath, Bournemouth, Brighton, Bristol, Canterbury, Charnwood, Durham, Exeter, Leeds, Manchester, Milton Keynes, Newcastle-up-Tyne, Northampton, Oxford, Portsmouth, Preston, Redbridge Sheffield and Thanet, with more to come. The list does not really influence the basic advice; check before investing.

Waccy Baccy Warning

Just been talking to a landlord who's had issues with cannabis farming at one of his properties. It's a growing problem. According to Aviva there has been a 30 per cent year-on-year increase in claims.

'Cannabis farming comes with serious risks for landlords; properties can be completely ruined inside to make space for plants, water damage can occur and fire poses a risk due to interference with electrics or strong lighting left on for a long time. Property owners must be vigilant and there are some simple steps that can be taken.'

'We would advise thorough checks on tenants and regular visits to properties - both internal and external inspections. Permanently closed curtains, blacked out windows and strong smells are all signs that there may be a cannabis factory on your premises.'

Iain Maitland www.ukpropertyalerts.co.uk www.internationalpropertyalerts.co.uk