The Private Sale Puzzle

Something different for the week before Christmas…I need your help!

I’ve just added a new blog post here. It’s called ‘The Private Sale Puzzle’ and concerns something which everyone seems to accept as normal, but which I just don’t get.

I want you to explain it to me!

You can educate me in the reply section in the blog. I’ll send the writer of the best reply something fantastic for free…or failing that, one of my books!

Streetwise Property Alert 16th December 2013

Let’s start the week with the monthly currencies review from Peter Lavelle at Pure FX…


Quite simply, what a performance! Sterling reached multi-month, if not multi-year, highs against virtually every major currency out there in November, including a 10-month high against the euro and a 2-year high versus the US dollar.

The reason? Well, it’s the simple fact that the outlook for the UK economy just gets brighter and brighter. For instance, Britain’s factories received orders at the fastest pace since 1994 last month, with manufacturers adding some 5,000 jobs-a-month to their payrolls. Meanwhile, the UK’s construction sector expanded at its fastest pace since before the financial crisis.

Given this, the Bank of England took its 1st step toward raising interest rates, by saying its Funding for Lending Scheme would no longer apply to household mortgages. If the UK’s out performance continues, who’s to say how high the pound will go?


Euro-eka! Sterling leapt to 1.21 against the euro last month, it’s strongest since 11 January. How come? Well, it’s mostly because the UK’s economy is going a mile a minute compared to that of the Eurozone. For instance, while the UK expanded +0.8 per cent in Q3, the currency bloc grew just +0.1 per cent. And while there’s talk of the BoE raising interest rates, the ECB has been talking about quantitative easing (printing money) to keep the Eurozone afloat. Given this, the euro tanked in November!

US Dollar

Downhill from here? Sterling hit 1.6347 against the US dollar last month, its highest since August 2011, or more than two years. This was chiefly because the UK economy continued to surprise to the upside. However, the pound may find itself going down down versus the greenback from hereon, because unemployment in the United States fell -0.2 per cent to just 7.0 per cent in November, far more than forecast, while 203,000 jobs were created. This will likely give the US dollar a sharp boost.

Australian Dollar

That’s what I call jaw-boning! Sterling leapt to 1.8062 against the Australian dollar last month, its strongest since July 2010, as chief of the Reserve Bank of Australia Glenn Stevens said everything he could think of to weaken the Aussie. For instance, Mr Stevens broke a long-held taboo by saying he was “open minded” about intervening to weaken the currency. Mr Stevens wants to weaken the Aussie to boost Australia’s economy, which currently faces a “threat of recession.”

Kiwi Dollar

Strong economy, weak currency! Sterling flew to its highest against the kiwi dollar since June 2012 last month, at 2.024. However, this wasn’t because of economic weakness in New Zealand; quite the opposite, kiwi business confidence hit its highest since 2000 in October, while New Zealand’s terms of trade reached their best in 4 decades! Instead, it’s just the case that the UK’s good economic news trumped that of New Zealand, taking the pound higher against the kiwi.

Loonie Dollar

Canada don’t look now! The pound reached 1.7479 against the loonie dollar in November, its strongest point since 2 December 2009, as Canada’s economy received several blows to the gut. First, the debt-to-disposable income ratio among Canadians reached 163.4 per cent, suggesting that Canadian shoppers are deeply, deeply in the hole. Moreover, Canada’s manufacturing exports sit some -30.0 per cent lower compared to 2008 at present. Given this, the Canadian dollar is just going down in flames against the pound!

Turkish Lira

It’s not a good time to be the lira! Sterling reached its all-time high against Turkey’s currency in November, at 3.33, as the lira just falls and falls. How come? Well, it’s in large part because Turkey is almost completely dependent on imports for its energy, which is fuelling huge imbalances in its economy. Given this, Turks are going so far as to hoard foreign currency, in anticipation of the lira declining further. With that in mind, the pound will likely climb further against Turkey’s embattled currency!

Brazilian Real

The real suffers a 1-2 punch! Sterling hit 3.84 against the Brazilian real in November, its highest in four months, for two reasons. First, Brazil’s budget deficit reached -3.4 per cent this year, the widest since 2009, fuelling concern that Brazil’s credit rating might soon be cut. That then weakened the real. Second, there’s talk that America’s Federal Reserve might cut back its economic stimulus this month, which would mean less funds flow to Brazil.

Do email back if you’d like some one-on-one advice from Peter.

All for now, see you tomorrow.


Flowers In Under Two Hours

The internet has changed everyone’s expectation of what constitutes fast service, and the ‘deliver-it-to-me-now’ mentality is pervading many market sectors. Bloom That is embracing the idea of super-fast delivery in the flower business, promising to pick, prepare and deliver fresh bouquets in under ninety minutes.  Flowers are chosen from what is available from local growers and then delivered by bike messenger.

Bloom, which is based in San Francisco. I can see no reason why something similar wouldn’t work in any major city. The key elements are local growers, local customers and local deliveries. The major selling point over other services is speed.  If you don’t fancy going into the flower business, what other product or service could you provide on a similar basis…local suppliers, local deliveries and faster service than can be had anywhere else?

Streetwise Property Alert 12th December 2013

More overseas property news and views for you today…

Top Of The Props Updates

According to The Move Channel’s latest ‘Top Of The Props’ chart – the number of enquiries relating to each country – Brazil is the big mover right now. The US remained the most popular country for the fifth month in a row in November, taking 20.92 per cent of all enquiries. Spain came second – some way behind at 6.99 per cent but ahead of third placed Portugal and then France.

Let’s quote, ‘As the 2014 World Cup and 2016 Olympics draw closer, the potential for further growth has seen demand climb even higher. Brazilian property broke into the portal’s top three countries for two months in a row in February 2013. Last month, Brazil accounted for 4.5 per cent of enquires, its highest share since April.’

‘Brazil’s soaring real estate values and upcoming sports tournaments have made it ripe for investment. In fact, the country has only appeared outside of the Top of the Props Top 10 once in the last 30 months! The 2014 World Cup may only just be kicking off, but Brazil’s ranking in the global property tournament is undeniable.’ If you are looking at an armchair investment in Brazil, remember the introduction we are still making – £23,000 investment, 15 per cent return in one year, every member who has invested has had their money and profit back on time and all but one have re-invested and more than half have invested more. Worth a look? I’d say!

More On Montenegro

According to OPP Connect, ‘Budget airline Ryanair announced is introducing its first route from London Stansted to the capital, Podgorica, from Tuesday 1 April 2014, twice a week, on Tuesdays and Saturdays, instead of flying into Tivat, as previously proposed.’

Peter Flynn, of, tells OPP Connect, “Although Tivat airport would be preferred by many, as it’s the closest airport to many of the latest luxury developments – it is ten minutes to Porto Montenegro and Lustica Bay. The use of Podgorica Airport will, of course, benefit the capital and the whole of the coastline of Montenegro, opening up the southern beaches.” Food for thought.

Mortgage Misselling Claims

Duncan McNair from Cubism Law in London reports that, between 2003 and 2010, Cypriot banks suggested buyers take out a mortgage in Swiss francs because the interest rates were lower but that this advice backfired when the franc soared after the financial crisis and mortgage repayments doubled.

‘Those who think they may have been missold a product must act quickly, as claims have to be filed in Cyprus by 31 December, or they are likely to fail outright. Commonplace features that I am dealing with are a failure to advise on the risks of foreign currency mortgages, serious misrepresentations as to the property itself, and dubious powers of attorney – as well as unhealthily close relationships between the banks, developers and selling agents.’ More to come? You tell us. Email back.

All for now, see you soon.

Guaranteed Pregnancy

There are a number of apps available, designed to help couples conceive. But now a new app backed by Pay-pal co-founder Max Levchin seeks to take the whole thing to a new level, with an interesting ‘get pregnant’ guarantee.

Through the Glow First scheme, every couple pays $50 a month to use the app, and must try to conceive for ten months while using it to take advantage of the guarantee scheme. If users get pregnant, all well and good.  If they’re still struggling after ten months, the money  from the community fund is used to pay for treatment at an infertility clinic.

I mention this because it’s an interesting use of a guarantee which backs the performance of  the product. To take advantage of the guarantee and get free fertility treatment, app users have to keep a detailed log showing that they’ve followed the system. I’d expect a requirement like this to really suppress the number of claims, as most people will be too lazy or disorganised to follow the system, let alone keep records. The offer is very enticing though.

Could you incorporate a performance guarantee with your product or service? It could certainly increase sales, and won’t be ruinous at the other end either – provided your product is fundamentally sound.

Teddy Bear Travel

There are days when I have to check the calendar to see whether it’s April 1st. This is one of those days.

Unagi Travel is a Japanese company.  They argue that travelling around Japan requires money, energy, and days off work. If you can’t afford to spare those things, why not send your stuffed toy on the trip instead? I can think of several reasons, but they haven’t stopped 200 people taking up the offer and sending their Teddy on a trip which includes Japanese hot springs, temples, and beaches. Bear owners have to  fund the  trip to Japan, but Unaqi takes care of the return voyage. The bear  also receives a commemorative DVD filled with travel photos in return for the $40 fee.

I really don’t know what to make of this, but if Americans are daft enough (that seems to be the main market) why not try something similar here in the UK.? There have to be harder ways to make a living than transporting a bag full of bears around UK tourist attractions with a camera.

Streetwise Property Alert 11th December 2013

Welcome to today’s email of news and views…

BTL Yields

BTL investors usually like to know how the ‘average’ BTL investor is doing to see how they compare. As such, you may be interested in the latest yield figures from Paragon Mortgages.The average buy-to-let yield is down by about 10 per cent over the year to end of Q3 2013. The average rental yield was 6.7 per cent in Q3 2012 and now stands at 6.0 per cent; a slight slip from 6.1 per cent in the
year to end Q2 2013.

Best invests? According to Paragon, HMOs achieve 7.1 per cent yields on average followed by lettings to migrant workers at 7 per cent and lettings to students at 6.6 per cent.

John Heron, director of mortgages, says that yields are currently stable. ‘What we are now seeing is less variation in yields across regions which suggests that we are seeing more consistent rental demand across the country. Demand from landlords for buy-to-let property has remained high during 2013 and I expect this will continue as we move into 2014.’ More to come.

Mortgage News

Catching up on BTL mortgage news – a little behind – we note Santander has changed its buy-to-let criteria to appeal more to Joe Public landlords. The lender will now consider buy-to-let applications from landlords who have:

A maximum of seven buy-to-let properties on completion of the new mortgage.

A maximum of five buy-to-let properties mortgaged with Santander on completion of the new mortgage.

A minimum of one and a maximum of 10 secured credit commitments at the time of application.

Where an applicant will have five or more buy-to-let properties on completion or five or more secured credit commitments at application, at least one applicant must be employed earning a minimum basic gross salary of £50,000 a year.

Where an applicant has four or less buy-to-let properties on completion, or four or less secured credit commitments at application, the criteria remains the same with at least one applicant earning a minimum £25,000 a year.

Other criteria:

Borrowers must be aged between 21 and 70.

Minimum purchase price of £75,000.

Maximum loan size per property of £750,000.

A minimum deposit of 25 per cent is required and rental cover of 125 per cent or above, calculated on an interest only basis.

The buy-to-let affordability rate is 5 per cent.

Applicants must already have a residential or buy-to-let mortgage.

Houses in multiple occupancy not eligible.

We are, in the New Year, looking to do a weekly BTL mortgages update. Let us know if that interests you, whether as a contributor or a recipient.

Coming Soon

If there is one trend that will accelerate in 2014 it’s the wholesale move over to licensing for all landlords everywhere. I’d urge you, if you are investing in a BTL somewhere new, to check the local council’s position before you go much further. I’ve been sent a press release for Loughborough where changes are afoot for the New Year. A quick quote.

‘Ron Jukes, chair of the panel, said, he believed landlords should be licensed, something which is already underway in Nottingham. “We are a caring council and this is part of our ethos,” he said. “It’s something that should’ve been dealt with or reviewed probably five or 10 years ago as we were becoming a larger university town because I don’t think we moved with the situation.”

“Let’s not kid ourselves, some of our landlords are very good and some of the properties are excellent. We have all made suggestions on what we would like to see happen and we will prioritise the order in which we will try to solve them when we meet in January. I think at the end of the day when it’s all settled, we will have achieved a major step forward.” My 50 pence is in more licensing and lots of it. And, what’s more, it’s coming your way soon wherever you are.

That’s it – see you tomorrow.

Streetwise Property Alert 10th December 2013

Overseas property news today- which reminds me! We have the monthly currencies review in from Peter at Pure FX. Email back for that and we will send it to you.

Bahamas – News

Luke Smith, managing director of Crystal Investment and Real Estate (yes noted), is in the news talking about the Bahamas. ‘A major contribution to the recent growth in the overall Bahamian economy is Kerzner International’s Atlantis Resort and Casino, which took over the former Paradise Island Resort and has provided a much needed boost to the economy. The islands’ zero rate income tax, capital gains tax, wealth tax and VAT is clearly luring wealthy foreign investors looking to avoid spiralling tax burdens overseas.’

‘The Bahamas’ tax situation is very attractive to foreigners, many of whom choose to become residents. There are no taxes on income, sales, estates or inheritances and there is no capital gains tax on real estate. Foreigners who own properties in the Bahamas are eligible for a home owner’s residence card which is renewable annually and those who purchase properties valued at least US$500,000 are given priority in permanent residence applications.’ If you are interested in the Bahamas, we can put together a long article/short report if there is sufficient interest. Let us know.

And Inevitably

The Bahamas

One of our longest-serving contacts has two offers…

Brand New Apartments


This brand new complex is situated next to a small picturesque lake and a short five minute walk to a private sandy beach. It will include just 10 apartments keeping the development private and discreet. Perfect as a second home investment!

Modern in design but with rustic touches all of the apartments are two-beds two-baths with fitted kitchen, spacious lounge and balcony. Each apartment has views of the tropical landscaped gardens, pool and lake. The relaxed ambience will be evident throughout the gated complex with water features, fire pits, private seating areas and a deck area overlooking the lake.

A large artisan designed swimming pool will be the centrepiece of the gardens with sunbathing areas. Each owner will benefit also from secure garage parking and storage areas within the building ensuring peace of mind during periods of absence.

Beachside Lots

From just $30,000 with payment plan!

The island is completely unspoilt, rugged in terrain and with beautiful beaches. All within your reach now as we release phase one of our residential lots, all within a stone’s throw of our own private beaches.

Each lot will allow one single family home, one storey or two and can be a tiny cottage or a large mansion! We have plenty of options available for you to choose from.

Each lot will vary in size but are all 1/2 acre or more in size. Some lots will allow sea views, some will not, if a sea view is important to you please ask for our advice.

Sold freehold with the right to build, just bring your plan or choose one of ours.

Selling from $30,000 with payments plans spread conveniently over a year makes these plots very affordable.

A 10 per cent discount is given for all cash buyers.

We have full details ready to send to you and will even help you pick your plot. These are selling fast. Do not hesitate to contact us to secure your plot at vastly under market value prices.

‘Hidden Away’ Hotspot

OPP Connect reports that ‘Four market experts tell how overseas second home buyers areincreasingly turning to Montenegro as new luxury resorts are established on the Adriatic coast.’ I suspect the experts may well be developers/agents although that does not mean that what they say is not valid. Kari Haataja, Chief Executive Officer of North Star Development is one of these experts and does offer a good overview.

‘We see Montenegro having a great chance attracting increasing amount of visitors and buyers for second homes, residences from the Nordic and Northern European countries. Part of this clientele are active business people / entrepreneurial individuals and their families that are looking to find and acquire second homes for use for four to six months per year for work, outdoor activities and leisure. As Tivat Airport expands, more airlines confirm more flights into Montenegro and communications are improved, including more high-speed internet, demand will rise even further.’ We may extend coverage of this market in 2014; tell us if it appeals, please.

Central London – Where Next?

You can expect London prices, generally, to keep rising – so says new analysis from Winkworth. ‘We would expect to see a further 5 per cent rise in central London prices next year. We anticipate a higher level of price appreciation in suburban London of some 10 per cent, as an estimated £130 billion of Help to Buy mortgages and an ongoing low interest rate environment stimulate buying against a background of limited supply. Cheaper mortgages for the professional classes, greater job security and improved employment prospects will underpin the family house market.’

‘We believe that, in 2014, many that have held off buying in the country and kept their money in London will look to take advantage of the value gap that has opened up and make a lifestyle choice to move out. This will be supported by improved job security and a return to a more flexible style of working than in recent years. Consequently, we expect to see greater demand and price growth of around 5 per cent in the South East.’ Food for thought.

All for now, see you again soon. Do email back if you’d like to receive that monthly currencies review – it covers Brazil, Turkey, New Zealand and more.


Panda Poo Tea

In China, a resourceful business has created “panda poo tea”. There’s no excrement in the tea, (thank goodness) but instead, the green tea is grown on a farm fertilised exclusively with panda manure. The company claim  that the tea is rich in nutrients from the panda’s excrement and entirely organic. The tea is priced at $35,000 per pound.

Two potential lessons here I think:

1. Sometimes, when you’re selling what is primarily seen as a generic product, you need a bit of a twist. The Panda Poo gives it in this market. What could you introduce to differentiate your product from the hundreds or thousands which are primarily the same.

2. Be careful when copying an idea. Panda Poo Tea sounds cute,  Cat Shit Coffee….less so!

The Migrant Myth

Migrant populations often have a tough time, no matter where they move to. It has to be said that the recent influx of people from central  and eastern Europe into the UK,  hasn’t been universally welcomed. However, a  piece of research I recently read from the Unites States, suggests we should all have a closer look.

The Partnership for a New American Economy calculates that immigrant business owners employ one in 10 U.S. private-sector workers, and notes that they started more businesses in recent years, in contrast to a decline in start-ups by native-born Americans.

I don’t know whether that pattern is repeated in the UK, but on-the-ground observations suggest that it may well be. The thing about migrants is that they have at least shown some backbone and initiative by getting off their collective backside and moving to another country. It seems this is often translated into positive action when they get there.