The belief that property market values in London and the UK will continue to rise has led many property investors into troubled waters of late. Since the financial crash of 2008, the market recovery in London has come as somewhat of a surprise, but the rest of the country remains at a low point, with house, flat and apartment prices well below the peak.

Improved market conditions and concerns

The government’s help-to- buy program certainly appears to be leading to improved market conditions and concerns are already being raised warning of the dangers of overheating, particularly in the London area.

However, the rental market in London and the South East has proved resilient in the face of the economic downturn. Among other factors, I see this as a product of foreign investors and real estate investing on a commercial basis as a hedge against falling currency values as a result of quantitative easing.

Average house price ratio

With the average property price-to-income ratio still dangerously high, particularly in London and the South East, there’s a warning to property investors out there who may think the worst is over. Along with the extension of the UK Government’s Mortgage Guarantee Scheme at the end of the year, all the warning signs are in place.

London Block Management commentators can be influenced in their views. Reports from real estate agents and property managers for condos and leasehold rentals will no doubt accompany the boom as long as it lasts.

The Service Fee Activities

Tenant utility activity is a good indicator of the cash that property owners have at their disposal, and frankly many are not in good financial shape.

Real estate agents hear firsthand how many tenants are struggling to make payments. Service fees and landlord arrears are certainly an issue in some locations. Areas of concern for London property management include areas near Croydon and Lewisham , and other inner London boroughs such as Lambent also appear to have been affected. The credit crunch may be a distant memory for bankers, but others aren’t so lucky and are still struggling to cash flow.

Can’t afford to pay and many are leaving

Some simply cannot afford to pay, and many end up leaving it to the courts, where they defend their plight.

In my experience, homeowners or tenants who are under financial pressure are more likely to default on utility bills than on their mortgages. The perception is that the risks of default on utility debt initially appear less onerous.

Financial pressure

But all those renters who are currently feeling the financial pressure are vulnerable to economic pressures and remain sensitive to even the smallest interest rate movements. A half-percent rate hike can mean a significant percentage increase in the net monthly mortgage payment.

All of this calls into question the future growth prospects of the London Block Management UK property market in the short to medium term.

There are other factors to consider such as B. Government incentives in the form of purchase aids, which could also keep prices artificially high in the short term. Demand may well outstrip supply, but when housing is simply unaffordable for most, this is the fundamental long-term move for all to see.

Some of the more cautious entrepreneurs

I certainly think some of the more cautious entrepreneurs might reconsider their approach with the benefit of further careful consideration. Never say never, but recent talk of a market recovery could well be a false dawn for UK property growth.