Many investors like property because of the potential for steady, above-average returns with only a limited downside risk. Others, however, are more intrigued by the possibility of a quick strike in a real-estate boom, such as this mini boom in Newport and South Wales as they become regenerated and prices rocket holding a property for a short time as values rise and magnifying their return with leverage from a mortgage or other low-cost loan.
Boom markets don’t come along very often in real estate. There haven’t been any since the big crash of 2008, and before that, they were usually limited to one or two places at a time, like London in the early 90’s, and The Midlands later that decade.
But booms are back, with some already well under way and a good number in the early stages.
“Home building lagged almost everywhere in the last decade while strong economic growth has pumped up demand for housing in many local markets, creating the imbalance that drives a boom.” Development Finance & Bridging Loans Experts – UK Property Finance, Who have a great Bridging Loan Guide
One of the hottest trends in property investing is in green retrofits, buildings upgraded for resale with eco-friendly and energy-efficient materials, products and features. The trend is already well established is the commercial sector. Now investors are eying the residential market as well. These top five tips can help guide investors to sound eco property deals.
Top Eco Residential Property Features
Proven energy-efficient technologies and features that will increase the value of a home include energy-efficient windows, Energy Star appliances and electronics, high-efficiency insulation, water-saving plumbing fixtures and photovoltaic hot water heating systems and energy systems.
Energy Performance Score (EPS)
The non-profit organization Earth Advantage Institute developed the Energy Performance Score to establish a standardized comparison of energy-efficiency features in the residential market. The criteria includes assessments of a home’s insulation, heating and cooling systems, lighting and appliances. The rating also includes a carbon-footprint score based on type of fuels used.
While eco-friendly materials appeal to many homebuyers, most homebuyers entering the market today are looking for home improvements that will substantially lower the home’s energy costs without adding too much to the upfront costs. As energy costs continue to rise, experts expect that attitudes will change significantly within the next five to 10 years and predict a time when homes without energy-efficient features will be viewed as “energy fixer-uppers.”
Looking Across The Pond…Green = Bigger Loans
It’s worth looking at neighbours across the pond who’s ideal we often taken on board they are currently considering passing the SAVE (Sensible Accounting to Value Energy) Act, a bill that would require major mortgage companies to take energy costs into account when insuring, guaranteeing or buying loans. The bill has bipartisan support. The new underwriting rules would require home appraisers to add proven energy savings to the home’s valuation, effectively providing a payoff for investors in green retrofits. This is something that we are also looking into lenders will take energy cost into consideration but it’s not written down this set to change with the US leading that way but we are sure to follow suit.