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Friday, July 11, 2008

Landlords - Viewing the Future of Property Investment is a Complex Thing


As a landlord and property investor I try to filter in news and the potential impact that news will have on my property investments and letting business.

I read the news that the housebuilder Barratt is cutting 1200 construction jobs today.

The chief executive Mark Clare has also predicted that as many as 60,000 jobs could go in the construction industry as a whole.
Now how could this impact on me financially?

Well, with lots of unemployed builders and tradesmen kicking their heels and wondering how to feed their luxury car and clothing budgets, they will be forced to look for work. So this will potentially fill the shortfall of free-lance tradesmen.

This might mean a leveling off of the previously rising cost of tradesmen. That to me will be a welcome relief because maintenance cost were starting to really get on top of me. Good news for my rental profit.

However then I was thinking about all those foreign workers that are holed up in the country who will see far greater competition for work when the British builders roll back into town.

This will potentially eat into their levels of income and tip them back to Poland or wherever.

Will this mean a mass exodus of foreign workers, reducing demand for housing and consequently adding to the house price falls and knocking down rental values.

Think back to the German boom of the Eighties it will be Auf Wiedersehen Pet in reverse.

This current economic situation is a complex reality that might not be able to be read and predicted by a few simple charts. As most things in life it's more complicated than we'd hoped.

Remember there are always two sides to every story.

Landlords and property investors, your predictions here, please.

Love and kisses , Margo.

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