Is Now the Right Time to Invest in Property?

While long-term prosperity remains far from assured, economic growth in the UK has finally superseded its pre-recession peak. It achieved this landmark during the second financial quarter, and although experts are continuing to warn about the threats posed by the ongoing Eurozone crisis and geopolitical conflicts there is a genuine reason for optimism among both consumers and entrepreneurs.

This optimism can be extremely contagious, and it can encourage proactive entrepreneurs or investors to branch out into brand-new markets. Investors who are looking to expand their portfolio may be tempted to move into the real estate market, for example, after months of continuous growth and soaring price points. The level of growth in the housing market began to stall in June, however, meaning that there may be issues ahead for real estate investors.

Falling Home-Buyer Confidence and Future Market Decline 

Stalling growth in the housing market is certainly impacting general home-buyer confidence in the UK. This is a critical factor for investors, as it alters the sentiment in the market and encourages them to take a far more risk-averse approach. According to a survey conducted by the Halifax building society, confidence in the housing market is at its lowest level in April 2011, visit House Buyer Bureau to find out more. Buyers are particularly concerned by disproportionate price rises and soaring interest rates.

In total, 42% of respondents believed that it was a bad idea to invest in property given the current condition of the market. This offers an insight into the uncertainty that plagues the existing market, as only buy-to-let investors can currently invest in real estate with a genuine degree of confidence or authority. Even this demographic may be forced to reconsider its investment strategies in the upcoming financial quarters, especially if the market begins to depreciate significantly and sends values plummeting.

For any investor who is in the market to make long-term gains, a depreciating real estate market is one that should be approached with considerable. This is true even if you intend to make short-term gains by leasing out properties on the rental market, as the capital earned will mean little if the structure itself continues to lose value as an asset. Without a true understanding of the market and a strategic approach to buying and selling property, real estate investment could end up costing you huge amounts of money.

How to Invest in the Current Real Estate Market

If you do decide to take the plunge and invest in real estate, the price at which you buy is critically important. If you are able to access genuinely discounted prices through property auctions or the quick house sale market, you can at least optimize any future returns and offset the impact of diminishing value over time.

This not only requires knowledge and an impeccable sense of timing, however but also a certain degree of patience. Property auctions provide a competitive and busy environment for buyers, and it is crucial that you maintain a calm demeanor while also striving to identify the deals that offer the greatest potential returns over time.