29 January 2008

Buy-to-let properties in despair

With the economy taking hold, property auctioneers reported a significant increase in the number of repossessed homes instructed for sale.

In particular, 40% of 410 lots are distressed sales that let down buy-to-let investors and as that they are to demolish.

There is also a noticeable increase in the number of properties asked to sell by banks and building societies that operate as mortgagees. It's a fact, distressed sales are rising.

Property industry had faced a similar situation in the early 90's with the housing crash but the today's crisis is not considered as serious as that one.

To put it into simple words, organizations that act as mortgagees such as mortgage companies and banks can repossess a property in case the owner fails to pay out the mortgage repayments. This may occur due to difficulty the investor faces to find a tenant or yet, because of the financial wearing off of the property's venture.

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