Streetwise Property Alert 11th July 2013

House Prices – Latest News

According to recent figures from the Nationwide House Price Index, prices are rising at their fastest rate in three years; a 0.4 per cent rise in May was followed by a 0.3 per cent rise in June and the year-on-year rise is 1.9 per cent.

Brian Murphy of the Mortgage Advice Bureau (MAB) offers a good summary, ‘Homeowners will be delighted to see a third month of house price increases in Nationwide’s figures. Potential buyers will be comforted by the fact that mortgage rates are still heading in the opposite direction. As property becomes more desirable by the week, falling fixed rates mean they can still enjoy exceptionally low interest on their loans for increasingly long periods of time.’

‘This golden age of rate reductions is coaxing more borrowers through the door and, with the guidance of specialist brokers, there are plenty of favourable deals to help them contend with rising prices – especially as  lenders are playing their part with some offering low-product fees. The onus is now on the government to put more faith in property and act now to increase housing supply.’

Land Registry Update

The Land Registry is providing its historical ‘price paid’ data records available free-of-charge. ‘The downloadable information will give users access to one of the world’s largest property datasets, consisting of prices paid in over 17 million residential cash and mortgage sales in England and Wales.’

‘The first phase, released on Friday, includes records of sales at full market value lodged for registration between January 2009 and January 2012. The remainder of the data covering the period January 1995 to December 2008 will be released by November. Collectively, this represents over 17 years worth of ‘actual’ information on the country’s housing market.’ Visit to find out more.

Mortgage Product News

Aldermore’s 75 per cent loan-to-value, two-year fixed rate BTL mortgage product is now available at 3.98 per cent. The 80 per cent LTV product is available at 4.48 per cent.  Limited edition term variable rates are also available as part of the buy-to-let range at 3.98 per cent for up to 65 per cent LTV and 4.28 per cent up to 75 per cent LTV.

Saffron For Intermediaries has reduced the rates on its Buy to Let Light Refurbishment mortgages. For landlords buying or remortgaging a property which requires refurbishment work to be undertaken before being let, highlights include: rate cut from 5.89 per cent to 5.23 per cent (SVR minus 0.16 per cent), for two years from completion: available to 75 per cent LTV of the end value of the property, up to £500,000: for purchase or remortgage: 2.5 per cent arrangement fee and 2 per cent ERC in the first two years. As always, talk to your broker.

Florida Update

We’d make an educated guess that for every 100 Brits buying in the US, some 60 to 80 of what we’d call amateur investors (i.e. they buy one or two starter units) go to Florida, and, as often as not, Orlando. According to data from Florida Realtors, the market is on the move.

‘Home sales continue to increase, it’s taking less time for sales to close, and median sales prices are on the rise. This (June) is the seventeenth month in a row that we’ve seen the statewide median sales prices increase year-over-year for both single-family homes and for townhome-condo properties.’

‘The numbers continue to move in the right direction. We remain concerned about the rise in the percentage of sales accounted for by all cash buyers. These numbers understate the true condition of the market in that a great many sales are conducted directly with the financial institution holding the property and thus do not appear in the Multiple Listing Service. But those crying doom-and-gloom who read this growth in investor activity as the sign of a new bubble are far off-base and simply don’t understand the texture of the current market.’ More to come.

Beware Rule Changes

We say it time and again; when investing overseas, do think ahead, looking at as many ‘what if?’ scenarios etc as you can think of. Take Singapore as an example – very popular with some members. Its central bank has set new rules so that (local) borrowers can use only 60 per cent of their monthly incomes to service borrowings.

So what? Doris Tan, Head of International Residential Sales at Jones Lang LaSalle says, ‘The impact (on the local property market) will be great as there is a large number of people who want to be owners of private residential property. However, with the introduction of a lower overall quantum and more difficulty to qualify for a loan, it will definitely affect sales of both local and overseas properties.’ Food for thought? Will local buyers be pulling out of those ‘luxury’ two bed apartments that overseas buyers go for? Which way for prices then? Who will buy from you when you want to exit the market?

What About ‘The Extras’?

Have to say we have lost count over the past decade of the number of investors who have pulled out of a deal at a late stage because their budget did not extend to cover closing costs. Checking should be part of your early-stage due diligence.

Knight Frank’s latest Buying Costs report sets out the purchase costs and annual charges for a non-resident buyer purchasing a new-build property above US$3m (£2m) in 15 global cities. Okay, it’s not in the ballpark range of most IPA buyers but it makes interesting reading nonetheless. Non-residents can expect to pay 25 per cent on top of their purchase price when buying a $3m home in Hong Kong, for example. Check before progressing!


Doggie Supplements

Food supplements are big business throughout the western world, and it t was only a matter of time before preventive medicine expanded to cover all members of the family…even the dog.

We’re already seeing advertisements for canine food supplements on mainstream TV, and to the casual observer, it would seem (perhaps as you might expect) that the rules and regulations on advertising claims aren’t anywhere near as stringent as those for products created for human consumption.

As we’ve said here many times before, there seems no end to the amount of money people will spend on their pampered pooches. It appears that the pet supplement business may have less barriers to entry than that for human supplements, so this could be worth some further investigation. I think there’s an opportunity for someone to create a blockbuster product in this field, and the marketing angle will be the key.

I’m not suggesting this will be easy, but I am suggesting that there’s a fortune waiting to be made by someone here with the right idea. I’ll repeat – marketing will be the key that unlocks the fortune.

Streetwise Property Alert 4th July 2013

Welcome to today’s news…

High-End Spain News

From 1 January, non-European buyers of property worth over €500,000 in Spain will be granted a residency visa; many pundits are suggesting that this will generate considerable interest amongst overseas buyers from Russia, China and the Middle East.

Michael Lovett of agency Fine & Country Spain believes this will act as something of a trigger not least because it will enable buyers to move freely between the different European nations. He likens the trigger to the similar visa offer made in Portugal where that drove up sales. In essence, ‘We hope to see a renewed interest from Asia with market analysts predicting a €100 million worth of property investment in Spain over the next 24 months.’

Watch Marbella, he suggests. ‘The high level of wealth and assets in Marbella set it apart from other Spanish towns. It is a real magnate for savvy investors. In Nueva Andalucía especially, where there is the biggest variety of residential nationalities, international culture has significantly boosted tourism and property sales in the last 12 months. It is clear confidence in the market place is growing. We expect luxury areas like Marbella, ideal for high end buyers, to profit from added migration.’ We have access to well-priced properties in Marbella for serious buyers.

US Boom

One of the things we like the look of in the US market is that funds have been moving in with enthusiasm. Take the Australian fund, the US Masters Residential Property Fund It’s reported that, in the past year, it has bought ‘490 properties and more than 1500 units throughout New Jersey’s Hudson County and the New York boroughs of Brooklyn and Manhattan’.

Why? Their MD Alan Dixon explains, ‘The US housing market has reached a critical turning point. For the first time since 2006, US house prices have begun to increase steadily. Independent appraisals show the fund’s property values have appreciated on average around 10 per cent over the period (12 months)’. We are currently looking at where ‘the big boys are playing’ with a view to a short article or a four-page report).

Turkey – Quick Update

Of interest to lifestyle buyers, Turkish property specialists Spot Blue report that Turkey has almost 400 beaches with Blue Flag status; that’s the highest number ever and puts the country third out of 48 participating countries.

‘While some countries are falling down the rankings, Turkey is raising its game and improving the quality of its beaches and marinas. The knock-on effect is positive for the property market. Being near a Blue Flag beach can only help a property hold value.’

Antalya is the place to be on that basis. It has 179 Blue Flag beaches. Mugla comes second, some way behind, with 76 flags. ‘The latest Blue Flag list highlights just how untapped much of Turkey’s coastline is. Away from the main resorts, there are dozens of stunning beaches and bays that many foreigners never encounter, real gems each with a selection of properties to choose from.’ Looking seriously at Turkey for a lifestyle buy? Drop us a line, we may have something for you soon.

The Kids Spa

It’s no secret that little girls want to copy their mums, and that’s the basis of the business set up by Ayanna Williams near to Buffalo, Canada.

Candyland Spa is a spa set up exclusively to pamper children. Treatments include chocolate facials and banana pedicures and because everything is for decorative or entertainment purposes, there are no special licences required to run the business. The company started out in the basement of a house, progressed to running mobile parties, and eventually ended up in High Street premises.

There are two things to take from this. Perhaps you could start and operate a similar business here in the UK. It seems perfect for any reasonably affluent area. If you don’t fancy that, how about giving some thought to the overall principle…what other ‘adult only services might it be possible to convert into a child-focussed spin off version?

Streetwise Property Alert 3rd July 2013

Today I’m very pleased to announce the launch of a brand-new service for members. We’ve been working behind-the-scenes on this for some time now to get everything ‘just so’ before telling you all about it.

Mick Rawlinson and I have assembled what we believe to be one of the best armchair investments we’ve ever seen – it is a joint venture opportunity.

The opportunity exists on a limited basis to invest in property development joint ventures with an experienced UK-based team backed-up by considerable resources.

Over to Mick…

Property Investors! Don’t Work Harder, Work Smarter. Consider a Joint Venture.

Smarter property investors are making substantial gains without lifting a single finger. Yet, there is absolutely no secret to it whatsoever. Anyone can do it. The process is easy to understand and gives you all the benefits of property development, without the downsides of the day-to-day management.

The answer is simple; joint venture property projects.

Learning how to leverage an expert’s time, knowledge, resources, contacts and skills could be the solution to pain-free investing for you. Get it right and you can literally sit back and watch the profit roll in.

Find out how a joint venture relationship can get you access to professionally-run property projects.

A joint venture is where two, like-minded parties come together to leverage each other’s skills and assets. You both bring something to the party. So, if you have the cash but not the time or experience, one of the best ways to profit is to invest in a joint venture project.

Who would a joint venture project appeal to? The answer is everyone (well, almost everyone). Unless you possess the experience, time or systems to invest in a property development, then perhaps you shouldn’t do it yourself and instead work with an expert. An expert has the track record to acquire projects, complete the work needed, and get you paid, every time.

Some people often can’t access mortgage finance (or don’t want to) but still have cash to invest in property so a joint venture is a perfect passive money-maker.

A joint venture project could be as simple as you giving an expert some of your cash for him or her to buy a property, renovate it and then sell it at a profit. You’d then split that profit; usually 50/ 50.

Click here for more JV information and your FREE JV property development guide:

…Thank you, Mick.

Do please click the link and see what Mick has to offer. We’ve spent months working on this and I think it is something that will interest all of you, especially those serious investors with cash who want to make some easy money…without even lifting a single finger.  Click the link and find out more – you won’t be disappointed, that’s for sure.

The Alternative Limb Project

When I was a kid, spectacles were horrible things, and the range of choice was virtually zero. Today they’re fashion items and you can have pretty much anything you want. Now we’re seeing the same range of choice moving into other areas of ‘disability’.

Last summers Paralympics really brought the whole subject of disability to the fore. We’ve been saying here for some time now, that people, who need equipment or devices to help them with a physical problem, are no longer prepared to accept second best. The Alternative Limb project is a private enterprise, set up to satisfy the demand for fashionable, unconventional prosthetics.

The company aims to help amputees customise the prosthetic limbs they use. Customers can have a limb made to their own design, reflecting their fashion sense and personality. So far the company has built a ‘stereo leg’ with built in speakers for a songwriter, a modular anatomical design for a former soldier and a floral prosthetic for a young mum, amongst others.

So what’s next? What other category of health or wellness product might be ripe for a fashionable makeover? Utilitarian products simply don’t cut the mustard any more.

Streetwise Property Alert 2nd July

Welcome to today’s email of overseas news and views…

US – Are You Too Late?

Have you been planning to invest in US property? I think it’s fair to say that, with some markets, Miami for example, the bottom came and went some time ago. There are other markets that are, arguably, now at the bottom and you may wish to look at them soon if you are keen to avoid missing out on the keener deals. The National Association of Realtors (NAR) offers a good overview.

‘The recovery is strengthening and we expect limited housing supplies for the rest of the year in much of the country. The housing numbers are overwhelmingly positive. However, the number of available homes is unlikely to grow, despite a nice gain in May, unless new home construction ramps up quickly by an additional 50 per cent. The home price growth is too fast, and only additional supply from new home building can moderate future price growth.’

‘Market conditions today are vastly different than during the housing boom. The boom period was marked by easy credit and overbuilding, but today we have tight mortgage credit and widespread shortages of homes for sale. The issue now is pent-up demand and strong growth in the number of households, with buyer traffic 29 per cent above a year ago, coinciding with several years of inadequate housing construction. These conditions are contributing to sustainable price growth.’ If there is sufficient demand from, say, 12 to 20 want-to-invest-this-year members, we will run a small seminar in London on a Saturday in mid-July. A show of hands please?

What If?

We always stress the importance of – as part of your pre-investing due diligence – thinking about worst case scenarios and how (if!) you could live with them. Examples? What if the size of the development doubled? What if you could not let the property? What if it is not even built? What if flights to that airport cease? What if the government…and so on.

OPP Connect makes an interesting point on this matter with, in essence, the far from uncommon scenario of what if the currency exchange rate changes. They quote Marc Morley Freer, Head of Private Client Business at Smart Currency Exchange, who comments on what might happen as Mark Carney takes over from Mervyn King. ‘It is fairly widespread comment that Carney is likely to take the stance of sterling devaluation and join the many other countries in trying to reduce the strength of their currencies. Effectively this ‘currency war’ has trundling along now for many months.’

‘If Carney goes the full course, rather than reducing his plans at the first signs of financial improvement, we could see sterling reduce by up to 15 per cent giving USD/GBP rates of 0.755. This would generally be good news for overseas buyers as the UK becomes more affordable. Given that this calendar year sterling has already devalued by 4 per cent it is making the UK housing market look like a cheap asset purchase for foreign investors.’

‘Any overseas property buyer making a purchase in the near term should seriously consider their options when securing their foreign currency and ensure that they keep to budget. With the expected currency movements it could be all too easy for a buyer to face an additional cost of 10 per cent or more unless they take steps to avoid this. It is therefore important for UK property investors to think about fixing the exchange rate for future transactions.’ A good heads-up.

Prime London News

According to the latest Savills quarterly prime London index, prices are still rising strongly. Prime property prices increased by 2.5 per cent between April and June. As ever, look behind the averages. There are significant differences in performance between locations and price bands.

‘Fulham is classic example of an area which has undergone ultra-gentrification, attracting international and domestic buyers who, despite significant wealth, have been priced out of the central London market. Such migration of wealth is being seen from Chelsea to Fulham, Kensington to Battersea and Wandsworth and from Notting Hill to Chiswick. At the same time, domestic wealth has resisted a move out of the capital in this recovery cycle, resulting in a concentration of demand in prime southwest London and similar markets such as Islington.’

‘Other central London markets have remained more reliant on world money and price growth has become more subdued. Locations such as Kensington, Holland Park, Notting Hill and St John’s Wood have been more sensitive to the effect of stamp duty changes for properties over £2 million than the core central locations. This has focused buyers’ minds on whether certain segments of the market are fully valued for now with the result that these areas barely registered any price growth in the quarter.’ More to come.