The decision in a recent test case in Bristol High Court threatens to drag hundreds of buy to let investors into bankruptcy.
The action was brought about by Prestige Homes South West. In short, they were suing an investor who agreed to put money into the development of a set of trendy apartment blocks. The difficulty is that it was at a time just before the price of such homes plummeted by 40%. This caused many investors to lose their funding as banks pulled the plug on their finance.
In this test case the ruling was for £133, 282 in favor of Prestige Homes. This leaves many people around the country very worried as they contemplate the fact they are in a similar position.
In the case of Prestige Homes, many of the investors (some first time home owners) have reached an agreement with the company out of court. But of the original figure of thirty investors, a further eight are so far opting to take their chances in court.
This is a sad situation for everyone. Whilst you can clearly see the point of the developing company these investors, through no fault of their own, have already lost their hefty deposits and stand to lose much more.
