Current property prices are rocketing, particularly inside the M25. Ignoring all the added extras such as the stamp duty and home information packs; in London you can now expect to pay up to 8.4 million pounds for your home, and even that will only buy you an empty coke can in a gutter in Essex. If you want a coke can with views of the river then triple it. Empty cans of Sprite cost even more.

This is having a knock on effect on commuters who are now being forced to live in trees on the moon and make a six month journey to and from the office each day.

The situation has been further complicated by the fact that prices are currently rising faster than the speed of light.

This sharp price rise has in itself caused a scientific anomaly that has forced scientists to rewrite Einstein’s theory of relativity. Whereas previously Einstein calculated that E = MC2, E is energy, M is mass and C is the speed of light.

However because the speed of light has now been overtaken by the speed of rising house prices in London, the new formula for the theory of relativity now looks like this;-

E =M [London House Prices (god they’re so flippin expensive, it’s a joke) divided by (blimey and that’s just for a bedsit) multiplied by (sod it we’ll just have to move to Hackney then) minus (Apparently it’s getting quite trendy now anyway)]

This new formula has enraged modern physicists. Although that’s less to do with science and more to do with the fact that they’ve been refused planning permission for their new conservatories.

Fortunately, presenter of Channel 4’s Property Ladder, Sarah Beeney has come up with an exciting solution to the problem.

“I think that the theory of relativity can exists alongside rocketing property prices in London” She said.

“All they need to do is knock through this wall here, to create an open plan kitchen breakfast room with a cool contemporary feel. Very popular with the family market”

Einstein then came back from the dead to respond to this statement.

“But I really like the idea of having a separate living space for the kids” he said, (in German). "The way I see it they can make as much noise as they like and me and the wife can enjoy this open plan terrace we’re planning to create above the ground floor extension."

“Well, it’s up to you” Sarah Beeney said. “But I really think you need to start looking on this place as an investment rather than as somewhere you would like to live.

Einsten got all huffy at that point and challenged Sarah Beeney to a fight behind the vending machine after work.

The debate continues.

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With the uncertainty of mortgage rates and the current downward trend in housing prices, any UK property investor would be wise to keep his money in the bank and watch the statistics over the coming months.  There could be a larger profit gained long-term by waiting for the market to bottom and then pick up property when it’s cheaper.  Homes being sold at the moment are going to be costing a higher than value price and the chances of making any substantial return on these is minimal. 

As the new year starts, many homeowners are going to be faced with repossession orders, or at least the possibility of one hanging over their homes and as bad news as this may be for the home owners themselves, this is where long term property investors will be able to make money.  There’s not a surplus of homes over people requiring them, so once the market stabilizes again the property will sell – it just depends how long you can afford to wait to see a return on the investment in the house. 

If you are looking for a future investment, you could consider looking at homes that are under repossession orders, and approach the home owners with an offer to buy the home with a view to letting them live in it as a rental agreement.  This way, you own the property, and they remain in their home until they choose to move.  You not only have the home as an asset you can use as collateral for other properties or sell to raise finance when you need it, but you will also have the monthly income from the rent you charge the current home owner.  Doing this however puts you in the position of landlord so if you haven’t considered this kind of property investment previously you need to look into the legal implications of what costs you are liable for before approaching the owners of the home.  Having done this, if you decide that this is a good investment option for you, make sure you get a complete survey of the property done before you make your offer, you may not be looking to sell it at the moment but it could affect the price you get at a later date if you do decide to liquidate your property assets.

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With the current property situation in the UK, anyone wishing to invest their money in the property industry would be wise to watch the situation for a while and see how things change.  It could be that in a few months a bargain or two may surface from properties that currently wouldn’t have much of a return on the investment if you invested in them now.  But that doesn’t mean that you must leave your investment capital sitting idle, it can still be earning money!

Whilst the UK property market is ailing right now, other countries are experiencing growth in the area, and it could be that your investment capital could be put to use on the international real estate stage if you do your research properly.  Although some countries, such as the US, are also showing a downward trend in their property market, there are other countries – Australia for example – where property investment is still a viable prospect. 

Before putting your capital into overseas property investing however you need to check out the regulations that govern such investments.  If you have a legal adviser, it would be wise to talk to them about any differences in how the investment works overseas compared with the UK property market.  If you plan on buying land with a view to development, then you should look into any legal issues that this will involve.  You should also do a good research audit on the area, and see what makes it a good investment prospect.  It could be that a local person will know more than someone in the UK, so try and get advice from both your own legal counsel and also from someone who lives local to the land you are interested in developing.

One good source of “local” information is the British Embassy in the country where you are planning to invest your money.  They should not only be able to advise you on local laws and regulations, but also give you advice that they’ve learned from other UK investors in the past.   Before signing any official paperwork for an investment overseas project, you should also talk to your tax adviser in the UK to see what your position is on taxation paid on overseas investing.

As the downward property market trend continues in the UK, don’t just watching it in dismay – get your atlas out, do some homework in current overseas property publications and see where your money can be best employed to get the greatest return for the smallest investment.

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Anyone who is thinking about selling their home needs to do it now because things are likely to get worse if they wait.  Those who have high mortgages and so risk even higher repayments resulting in foreclosures need to assess their housing situation now whilst the forecast is bleak but the market hasn’t really started to feel the impact.  Once this trend starts to really grip the property market and the UK enters a property recession, then it’s going to take longer to get a good price, and the chances of foreclosure due to non-payment of mortgage will be greater.

The sellers have had the market faced in their direction for a number of years now, with many people selling their homes for a huge profit.  Despite the housing shortage, especially for lower priced homes, there is now going to be a buyer’s market with first time buyers being the optimum choice for a seller. First time buyers may be facing tighter financial boundaries because of interest rates affecting mortgage repayment schedules, they won’t be stuck in a property chain.  The downside is that they are also going to have a larger amount of homes to choose from and will be able to buy the home from the seller who can offer them the best deal.  Any seller who has no equity in their home, and needs to sell, is going to find themselves in a very difficult situation where they have to sell the property, but have no financial negotiating power to attract a buyer who is going to be only too aware of the fact the property is overpriced.

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Research by the National Association of Estate Agents (NAEA) shows that the number of first-time buyers continued to decrease in May, dropping below ten percent of the market. Only 8.9 percent of the buyers signed their first home purchase contract in May, although sales remained at the levels of the previous month.

At the same time, the number of properties for sale in May went up, with around 16 per cent increases in every region. Per agent, this meant around 72 properties for sale, out of which, on average, only 13 were sold. According to experts, the surge in homes being placed for sale resulted mainly from sellers wanting to avoid the costs incurred by the introduction of Hips (home information packs).

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According to a study by Land Registry, house prices increased by 8.9 per cent since May last year. With an annual rise of over six percent, London Remains the most expensive location for buying a home. The London Average price house of £335,658 stays firm at number one, while the south-east follows in second, with £220,872.

In what property types are concerned, the most significant rises were recorded for flats and maisonettes, with 10.4 per cent since May 2006. Next are terraced homes, with 9.2 per cent, semi-detached properties, with 8.3 per cent, and detached homes, with 7.2 per cent. Only two regions across England And Wales Saw decreases in home prices, the north-west and the north-east, while in the south-east prices remained at the same levels.

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According to a study by Halifax, the best value homes in Britain Are located in the east and south-east regions of the country. More specifically, Buckinghamshire is rated best value for flats, Suffolk For terraced properties, and Sleaford in Lincolnshire For semi-detached homes. Besides property prices, the research looked at employment rate, average salary, housing types, owner occupation, traffic and safety levels, weather, healthiness of people in the region, and educational institutions.

There are several places where both home-movers and first-time buyers can take advantage of really good bargains. The best value for money flats are to be found in Chesham, while the most convenient terraced houses are in Stowmarket. Chesham also ranks sixth in the UK’s top of best places to live. Other reasonably priced flats (below £150,000) are located in Basingstoke, Ayelsbury, and Bracknell, all with high quality of life ratings.

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The new Tesco Property Market website is the first attempt of the supermarket giant to participate in the housing market, allowing both agents and home-owners to market properties online. For a cut-price fee of only £199, those who will chose to sell their home through Tesco’s services will get an online advertising space and a customized Tesco ‘For Sale’ board to place outside their house. Additionally, Tesco offers an online and phone service which will assist customers in managing bookings and offers. In order to provide a list of houses for sale, Tesco has opted to co-operate with another website, Fish4Homes. Other websites and estate agents, however, have declined and even warned Tesco not to include a search of their property listings.

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A recent survey from Zoomf.Com shows that the average price of a London four-bedroom property is £557,608, which is £161,221 more than a three-bed one (£396,387 on average). This price difference is much smaller when it comes to one and two-bed homes, with an average of £89,751. According to the website, on the London Market there are currently 7,916 four-bed homes, 10,636 three-bed, 13,655 two-bed, and only 5,698 one-bed houses.

The lack of one-bed homes is probably going to cause difficulties to first-time buyers, who will not be able to cover the difference of price to buy a two-bedroom apartment. Furthermore, due to the considerable gap between three and four-bed homes, many households will chose to improve their homes over moving.

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