Calling all Brits, especially Londoners...

[Phoenix]

...or those who know the London property market.
.
My hubby and I are thinking of selling our one-bedder in Limehouse, which we have owned for the last 8-9 yrs, to upgrade to a 2-bedder in the same area or somewhere in the Isle of Dog.

Do you think we should? Would it be easy to rent out a two-bedder (I know relatively it is not as easy as for a one-bedder, but I hear, correctly or not, that the rental market is pretty tight these days)? Would the rent cover the mortgage (we''d be taking the profit and plonk it back into the two-bed, so we''d be looking at a 50-60% mortgage, assuming the 2-bedder does not cost more than GBP400k)? Do you think the market is over-inflated or is it abt to go down (particularly given the upward trend for interest rate), even taking into a/c the Olympics?

Thanks.

 

[Pandora II]

Market will not go down in my opinion. Massive shortage of housing here. Rental market is tight - but not that bad. If we move, we're going to try and rent out our current property as it's a great investment right now.

Two bed flats are much easier to rent out than 1 bed as well.

An area you might want to consider is around London Bridge/Bermondsey St. We bought there in 2004 for 175k (2 bed ex council) and have just had a valuation of 275k this year. It's close to Guy's Hospital - so lots of young medics looking to rent, plus Shard of Glass going up next year - property prices will soar. You could get something amazing for 400k in Shad Thames or one of the warehouses or a great deal on an ex-council property. Rents are around 1,200 - 1,500 a month for 2 bed flats in ex-council properties in SE1.

Don't know the Isle of dogs area well I'm afraid, but anywhere near Olympics should do well.

 

[Phoenix]

Date: 5/14/2007 8:34:58 AM
Author: Pandora II
Market will not go down in my opinion. Massive shortage of housing here. Rental market is tight - but not that bad. If we move, we're going to try and rent out our current property as it's a great investment right now.

Two bed flats are much easier to rent out than 1 bed as well.

An area you might want to consider is around London Bridge/Bermondsey St. We bought there in 2004 for 175k (2 bed ex council) and have just had a valuation of 275k this year. It's close to Guy's Hospital - so lots of young medics looking to rent, plus Shard of Glass going up next year - property prices will soar. You could get something amazing for 400k in Shad Thames or one of the warehouses or a great deal on an ex-council property. Rents are around 1,200 - 1,500 a month for 2 bed flats in ex-council properties in SE1.

Don't know the Isle of dogs area well I'm afraid, but anywhere near Olympics should do well.

Thank you for your email and infor, Pandora. So you really don't think that the recent interest rate hike (as well as at least one more later on in the year) will dampen the housing market? I am so out of touch with the UK property market, particularly London, having left the UK some 12 yrs ago. So much is going on that I don't know abt and not just wrt the property market but the country as a whole (despite my trying to read up on the internet and so on)

. This is the first I've heard of Shard of Glass, but yr recommendations are definitely good ones.

One more thing, at the risk of sharing TMI, I've been talking to a couple of mortage brokers and they tell me that as I no longer have a regular income (I work free-lance on a project basis, so this means that at times I don't have any income coming in at all) and also as my husband is American and has never lived in the UK and has therefore no credit history in the UK, they won't lend us the money to either upgrade or buy another property

. This despite us having sizeable assets and my husband earning a very good salary and both of us having excellent credit ratings here in Singapore. The only bank who is willing to lend us money for a UK property is HSBC and they say that they're only willing to lend us the money to purchase one property, so this means that we'd have to sell our current one-bedder anyway if we really wanted to purchase a 2-bedder.

So now we're thinking should we really do this? Should we go ahead and sell what we have now and buy a two-bedder (perhaps doing the former straight away and waiting a little while for the interest rate hikes to have some effect before we buy a two-bedder (anyway the autumn/ end of summer should see the market quieten down a bit, right?))?

Another option would be for us to re-finance our house here in S'pore and purchase another one-bedder outright with that extra cash (our current estate agent in London says we should hold on to the one-bedder and not sell it at all). But that would also mean that we'd have 4 properties and 4 mortgages (instead of 3 properties and 3 mortgages, we also have an apt in Melbourne). What do you think?

On a slightly different but nonetheless related (if that makes sense!

) note, do you think Gordon Brown would do a better job with the UK economy than Blair has? I must say my personal view, rightly or wrongly, is that whilst I don't agree with Blair's decision re Iraq but the economy does not seem to have done too badly under his leadership. What's the general consensus in the UK regarding Brown?

Many thanks for your help.

P.S. any other comments or Q's from other PS'ers, even if you are not in the UK, would also be welcome.

 

[Phoenix]

Sorry, just to clarify: if we decided to go ahead and purchase another one-bedder and go with HSBC we''d end up with 4 mortgages, whereas if we were to re-finance our home in Singapore, we''d still have 3 mortgages (the one in S''pore would become larger) but not sure it''d be worth it spending all that extra cash to buy the flat outright.