Investomind

Future of Residential Buildings

The concepts of home designs are undergoing a lot of changes over recent years due to various factors. Some of them include urbanization, demographic changes, sustainability, affordability, and the digital economy. Builders and real estate firms these days give more importance to technologies and other things to satisfy the needs of investors. As a result, new forms of residential buildings will emerge in the coming decade enabling people to lead a comfortable lifestyle. They consider implementing the latest trends and designs in home building construction to ensure a perfect look.

Here are some designs that will evolve in residential building development in the coming decade.

  1. Smart home automation

Smart home designs are gaining popularity in different parts of the world because they offer several advantages. They cover automation techniques allowing homeowners to control the appliances, lights, thermostats, and other things remotely. Smart home automation gives ways to enhance the efficiency and security of property to a large extent. Although it is a little bit expensive, homeowners can increase the resale value of property effectively. Automated homes provide ways to ensure high protection for appliances from potential threats.

  1. Outdoor entertainment

Nowadays, homeowners like to perform different types of activities to relax their minds from routine life. Home designs will give more importance to outdoor courtyards and swimming areas. Moreover, they are becoming a focal point outside enabling residents to ensure better entertainment.

3.Multifaceted kitchens

Earlier, residential properties have tiny kitchens that will lead to several problems. On the other hand, most homeowners today like to have multifaceted kitchens to access other areas with ease. Spacious kitchens are the latest trends meant for a family because it provides ways to spend more time with others.

  1. Eco-friendly designs

Eco-friendly designs are creating awareness in the real estate markets because they give ways to reduce the footprints. Most eco-friendly home properties utilize recycled materials for building purposes. Furthermore, they show ways to get protection from greenhouse gas effects to live a problem less life.

  1. Net-zero homes

A net-zero home is a new concept that is becoming a popular one in different parts of the world. The building can produce its energy locally that will help obtain optimal results. Net-zero homes are energy efficient when compared to conventional homes because they need only less energy. Homeowners can even save money on HVAC energy bills with net-zero techniques.

  1. Safety features

Many homeowners like to build a property with more safety features to prevent damages caused by natural disasters. A majority of real estate firms focus more on building a home with high-quality materials to minimize unwanted problems efficiently.

  1. More dynamic windows

Windows play an important role in residential buildings to improve the appearance. Besides that, they provide ways to maintain a better environment by increasing energy levels. The window treatments will gain more importance in the coming decade to block harmful UV rays that affect people in different ways. Regulated windows with the proper materials will bring natural lighting and greenery to a residential property.

  1. Designs for senior people

A home should accommodate enough spaces for senior people to live a trouble-free life. The residential properties should include amenities such as wider hallways, added handrails, slip-resistant floors, grab bars, etc.

  1. Infill development

Infill development is one of the innovative techniques that will occupy an important place in building projects. It involves creating a structure in a vacant site or undeveloped land in an established neighbourhood. The primary objective of infill development is to create small homes with better designs in unused urban areas that are accessible to all amenities.

  1. Multiple-master suites

As real estate prices are increasing in many cities, many young families face difficulties in affording them. This will result in the emergence of multiple-master suites where many youths can share their spaces at the best prices. Furthermore, it will help a lot to reduce housing expenses significantly.

  1. Healthy homes

A healthy home will improve the living standards of inhabitants enabling them to lead a trouble-free life. Some elements covered in healthy homes include sustainability, energy- efficiency, contaminant-free, well-built ventilation systems, pest-free, safety, drying, and cleaning. Healthy home designs will attract investors in the coming decade.

  1. Stylish home designs

Stylish homes provide ways to increase the values of a property in the markets. Not only that, they show methods to ensure high-level comforts that will help plan important activities without any troubles. In addition to that, a stylish home utilizes 3D techniques to satisfy the needs of inhabitants.

  1. Affordable designs

Buying a budget-friendly home is not possible in urban areas due to high costs. A budget- conscious home property mainly uses inexpensive materials and modern technologies that will lower the prices. It consists of mid-to high-rise structures enabling people to experience generous living spaces.

  1. Flexible designs

Flexible designs will gain importance in the coming decade because they provide methods to redesign an unfinished property with innovative ideas. They show ways to make changes and accept modifications based on the choices of a buyer. Besides that, buyers can design their homes at estimated budgets to get the desired outcomes.

  1. Open-plan spaces

Open-plan spaces are becoming a huge hit because they pave ways to interact with others with more amenities. Home entertainment is getting more attention and families like to play games in a spacious environment. Moreover, open-plan places enable parents to keep an eye on their kids when they are busy with their works.

How to buy a residential property in the UK?

Anyone who wants to buy a home property in the UK should consider working with leading real estate agents or companies to handle complex issues. A real estate agent or firm will work closely with investors to know their requirements in detail when they want to buy a home property. Since the cost of living is high in the UK cities, homebuyers should seek support from a topmost real estate firm to accomplish goals with high success rates.

 

 

 

 

 

 

BOOK – Financial Freedom for Immigrants

If you are an immigrant or planning to come to the UK for a long term settlement I believe you have a big dream.

Dream to be financially Independent, Financially Free!

It is absolutely possible

This book is designed to help those who want to get into property ladder as early as possible without wasting time so you can build wealth and passive income leading you towards your dream,

“Financial Freedom”

 

 

Finding Deposit for Your Property

If you are like many immigrants who come to the UK to start a new life but have to start from
virtually nothing you are more likely to live in a room /flat share with friends. This means more
savings, as you are cutting down in accommodation expenses, which is one of the largest
expenses when living in the UK. When buying a property, if your credit rating is good, most
lenders will consider giving a mortgage for up to five times your salary. Although your savings
might be good but when it comes to mortgage the amount of your annual salary plays a vital role.
If your salary is towards the lower end, you can only afford lower priced property. If you desire a
higher value property with the lower income then you would require higher deposit. This is
where deposits from family and friends (in case of immigrants possibly from abroad as well)
may come as gifted money.

Gifted money

Not everyone will have enough deposits to buy their first home. You do have the option to use
gifted money as deposit, as long as you have someone you trust and you can rely on and who is
willing to gift you their money. Remember, gifted money means the person giving it should not
be expecting the money back — it’s not a loan. It’s given in compassion, love or relationship
status. Using gifted money from immediate family members is quite straightforward; however, if
the gifted money comes from a friend or other sources, solicitors would want to know more on
why they are gifting you the money. In all cases the person gifting you the money should put in a
formal letter the reason why they are giving you the money and that the recipient is not expected
to return the money in any form. The person giving the money should be in a sound financial
position so disclosure of income and expenditure is necessary.

You can also use part your own and part gifted money as deposit.
E.g.
You qualify for mortgage of £100,000, you have £20,000 savings but the property you want to
buy is £130,000. In this scenario, you may be able to raise £10,000 as gifted money.
If the gifted money was coming from a sale of an asset or a property, you will need to prove the
sale. It could be that they had two cars…they sold one of the luxury car to raise money as the
gift. The sale transaction would be the proof of incoming funds. Funds received as gifted money
should be traceable and justifiable (being able to see where it has come from and how it has been
acquired – such as selling property/land or savings).

Joint Mortgage

When you want to buy that dream house but do not have enough deposit and salary to cover the
mortgage on your own, then Join Mortgage is one option.
It’s mostly common between family members e.g. husband and wife, or father and son etc., and
in some cases between friends. There are a lot of lenders who would lend to two people joint, but
if you are doing more than 3, you will find very few lenders on the market. Remember to make it
clear what percentage of each joint member’s contribution is going to the property in case of a
legal dispute. Your solicitor should prompt you to do this.
For example, husband earns 3 times more than wife. Mortgage responsibility could be the same
or 50/50, which you need to make it clear just in case of legal dispute.

Guarantor Mortgage

Guarantor mortgage is when a family or friend takes the responsibility of paying the mortgage in
case the main mortgage applicant cannot pay the mortgage that could be due to loss of job, less
earnings, high expenses etc. This is common when parents want to help their children get into
property ladder early in life.

Buy Small and Upgrade

If you are a person who is driven by numbers and follow your head rather than your heart, this
option might suite you.

A friend of mine wanted to live in a large modern family house but his salary and deposit was
not enough to purchase one at that time. In the same area he found another house which he could
afford but was small and needed some work. He researched the area well, and found there were
other similar houses that were extended to make into a larger property. An estimate to do the
extension was about £40,000, but he did not have to do the works straight away. So he made a
below market value offer to this property with a view to extend into a larger property when he
gets extra funds available sometime in future. So doing this he got in the property ladder early
and also had the option to upgrade to a larger property in future.

Why is this time Right to Remortgage your property?

Why is this time right to Remortgage your property:

The UK mortgage market has been extremely active since the last recession when worldwide base rates hit historic lows. Even though base rates have started to creep up gradually, many think tanks believe it will still be awhile before they get anywhere near their traditional levels prior to the 2008 recession caused mainly by the mortgage sector crash. As a consequence, it makes perfect sense for homeowners to at least investigate the opportunities to remortgage their property and reduce high interest charges.

Even though some property markets around the world have struggled since the 2008 mortgage crisis, many luxury property markets have enjoyed significant growth. As a consequence, when remortgaging it may also be possible to utilise a degree of the increase in property values in recent times. Assuming you’re able to secure relatively low mortgage rates, fixed for two, five or even 10 years, there is the opportunity to slash mortgage payments and increase net investment returns in the longer term.

While a remortgage might be a good financial move for many homeowners, it isn’t right for everyone. People who are already in a stellar mortgage deal or who own less than 25% of their home probably won’t find a deal in the remortgage market. Borrowers with bad credit or very small mortgages may also find the process of applying and paying for a remortgage is not worth the effort or the money.

Here are some pros and cons for you to consider before moving forward with the remortgage process.

Some of the pros of remortgaging include:

  • The ability to borrow at a lower interest rate
  • The option of utilising your home’s equity for additional cash
  • The opportunity to switch to a product more suitable to your financial situation
  • The flexibility to consolidate your debts into a single, affordable monthly payment

There are some drawbacks to a remortgage as well, which include:

  • Stretching your debts to a longer time frame increases the overall cost
  • When your home is used as collateral, it can be repossessed if you cannot keep up with the payments
  • There are fees attached to remortgages, which may counter any of the benefits you might receive from negotiating a lower rate on your loan
  • The remortgage process can take a number of weeks to complete, so you will need to be committed to the process to see it through to the end

Source: Islay Robinson (Enness)

Flats vs House Investment

Advantages of buying flats as buy-to-let investment

  • Generally lower entry purchase price than comparable houses
  • Traditionally higher cash on cash returns and yields (not always)
  • Lifestyle trends may mean renting flats become more popular thereby reducing voids as young people and people without children often like flats
  • Cost of maintaining the building is shared & the freeholder (or the managing agent) will typically organise the work
  • Short leases, absent freeholder, can all make the investment an attractive proposition if you work on wrestling the freehold from the owner by getting others in the block to join with you, enfranchise and buy the freehold
  • Buying flats with management companies that have gone bust can be cheap as they are often un-mortgagble, fix the problem and the value increases
  • The cheaper nature of buying flats means its easier to buy a large number to build up your portfolio
  • Strong demand in metro areas can cause prices to soar
  • Easy to convert a flat to add an extra bedroom if flat currently has a separate kitchen by moving kitchen into living room

Disadvantages of buying a flat as buy-to-let investment

Below are some disadvantages of buying flats as investments.

  • Some have High ground rent and service charges
  • Harder to qualify for financing on a certain type of flats and LTVs meaning lenders see flats as higher risk
  • Smaller living spaces
  • Less opportunity/freedom to add value without consent of the freeholder (no ability to extend, convert a loft, add a conservatory)
  • Lower unique factor when the flat is situated in a large block
  • Higher turnover of tenants
  • Hidden high maintenance costs you didn’t perceive or anticipate that could effect your investment returns as freeholders can use this as a profit centre.
  • Harder to obtain finance on leases less than 80 years
  • Value of the flat will drop quite a lot once the lease goes below 70 years, so a payment will need to be made to the freeholder to extend, say £10k-£15k on a £100k flat to take lease from 70 to 125 years
  • Ground rents can increase a lot over time
  • ”Share of the freehold” can give the best or worst of both worlds depending how well others work together to maintain the property
  • High rise flats attract slower capital growth, council high rise blocks are often nearly unmortageable.
  • Concentration risk of lots of flats in a block can create a short term oversupply meaning voids or lower rental and capital values.
  • May not be able to convert the property into a HMO to reduce voids and increase cashflow

Advantages of buying a house as buy-to-let investment

  • Finance for single family units is more readily available
  • More privacy and feeling of space for tenants and buyers
  • They will attract longer term tenants such as families with kids who won’t uproot after 6-12 months and are more likely to maintain the property themselves
  • More potential for capital growth
  • They have a larger land size value giving you flexibility to develop, convert or extend to add value to flip or refinance
  • A house will always appeal to a larger cross-section of buyers such as first time buyers, investors and young families
  • No high service charges or issues with ‘common areas’ not being maintained
  • Ability to buy the property at market value, convert into multiple flats, create leases and either sell/remortgage or a mixture of both
  • Houses are generally freehold (you own the land). You don’t need to pay service charge or ground rent which can take up a large amount. This will give better cash flow.
  • Ability to add value by adding a conservatory, do a loft conversion, convert garden into garage/office and flip or refinance to withdraw some extra cash.
  • There is an oversupply of flats and less houses are being built, means houses will continue to be attractive.
  • Mortgage products are more favourable to houses than flats as lenders also see houses as safer investment.
  • Flats are more popular amongst first time buyers / amateur investors. Houses are supported by more sophisticated investors and family buyers which has more stability in the market.

Disadvantages of buying a house as buy-to-let investment

  • Typically higher investment and start up costs
  • A Garden you may need to maintain
  • Higher stamp duty & interest costs
  • More wear and tear if families have children
  • A house is more likely to be vandalised/boiler and pipes stolen if empty
  • Potential for more frequent maintenance and repair bills as there’s more square footage to maintain
  • Because of the lower yield the cashflow may be lower