ERI LA Socio-Political Blog

In spite of, or maybe because of the current credit crunch, there is an ever growing number of Home Buyers Organisations coming into the UK market. These are either private individuals or companies who have come to the decision that, even with House Prices sinking, it’s still a much safer bet to put spare money into Properties rather than leaving it in a Bank.

The idea behind this is straightforward enough. Large deposits in banks along with any funds belonging to companies are not protected by government guarantees, so could in theory disappear if the Bank goes bust. Properties on the other hand can’t under normal circumstances disappear. It’s also unbelievable that their values may fall to anything approaching zero, and in the medium to long term, it’s very likely that they’ll recover as the financial situation picks up.

But, it’s just too easy for the House buyers to get carried away, and shore up more problems for themselves. Let’s just pause and think for a moment about what that phrase “under normal circumstance” means. Just as we are seeing big upheavals in the financial situation, we must also be aware of the potential changes in our real climate due to global warming.

These changes could have a devastating impact on the value, and maybe the continued existence of any House you may choose as an investment. The House Buyer who’s purchasing as an investment or as a safe home for his spare funds may be tempted to just look at the findings of a good survey which sets out the value and condition of the property along with any current threats that may affect it.

A “real” House Buyer who’s planning to live in the House will look much more carefully at such things as coastal erosion, increased rainfall, old mining works, altitude, current and future industrial, commercial and Infrastructure developments, schooling etc. etc, and make his considered opinion about the effect of these during his lifetime.

Anybody fortunate enough to be cash rich at present can be forgiven for keeping their eye firmly on the current credit crunch and its possible consequences. However, when buying Properties as an alternative to funds in the bank, you need to treat the due diligence as seriously as though you were going to live in the House.

To paraphrase: Let the Home Buyer beware! When people purchase Properties to live in; they make sure of all sorts of things; like current and possible future risks of flood, storm, landslip and other risks. It’s much too easy for those who buy Properties for investment to pay lip service to these aspects.

These sorts of purchasers often just look for a call from a house owner in trouble to “Buy my House”. They jump on the opportunity with a minimum of effort, and get back to running their businesses. However, before I Buy Houses, I take as much care as if I was going to live there myself.