<strong>Camilla Dell</strong><br />MANAGING DIRECTOR AT BLACK BRICK<br /><br /><strong>Q. Dear Camilla, there has ben a lot of talk recently about property prices starting to rise. Is this true, and should I be thinking of buying? </strong><br /><strong>A. </strong>These things are never straightforward. When you look back at housing data and statistics from the last property market crash, there were some months when prices rose but there were also months when prices fell. <br /><br />This means that any price rises that we see should be treated with extreme caution. In London at least, it is quite possible that they are not a true sign of a market recovery, but a symptom of the severe lack of stock in the city. <br /><br />In London, prices are also fuelled by the weak pound, which attracts buyers from overseas, and a soft market (ie, one in which there are more sellers than buyers), then we should see prices stabilising in 2009. <br /><br />However, if unemployment continues to increase as it is predicted to, and interest rates start to rise &ndash; let&rsquo;s face it, they can only go one way &ndash; then we will see consumers tighten their belts and property prices may continue to fall further. <br /><br />Most experts are predicting another 5 to 10 per cent fall in the housing market before prices reach the true bottom. <br /><br />Our advice to investors at the moment is that buying into the London property market is definitely a long term investment with the main aim of capital appreciation, so if you do find a good investment property now, then it&rsquo;s definitely worth going for. For everyone looking to make a purchase, it&rsquo;s better to buy when the market is falling than once the market is rising. <br /><br /><strong>Q. Dear Camilla, I am interested in investing in property as an investment. I am looking at buying actual properties, but I am also considering investing in a property fund as an alternative. What are the main advantages of investing in property funds versus owning a property directly?</strong><br /><strong>A. </strong>If you have money in your pocket, then there has never been a better time to get involved in property investment. Prices are low, and they are sure to increase. If you are looking for either a rental income or a return on your investment a few years down the line when the market has picked up, then this is the right time to be looking.<br /><br />If you are thinking of investing, say &pound;350,000, then you could get yourself a small investment property. But if you are looking for a pure investment, then there are two main advantages to putting your money into a fund. <br /><br />Firstly, you don&rsquo;t have to deal with the hassle of running a property yourself, dealing with tenants and all the niggles that can involve. A passive fund will ensure that you don&rsquo;t have to worry about any of the properties at all. <br /><br />And secondly, then you are spreading your risk by avoiding the error of putting all your eggs in one basket. You get a greater diversity of houses within the fund and so you minimise your risk exposure, which is a key consideration in any market, and more than ever in the current one<br /><br />Camilla Dell is the managing director at search and acquisition consultancy Black Brick. Black Brick&rsquo;s residential property fund, Bruton Place, which is focused on purchasing prime residential property in central London, will launch soon. www.black-brick.com