Streetwise Property Alert 28th March 2014

any of you are interested in buying off-plan property overseas. Here, to end the week, are some words of advice from Peter Esders…

Research the development, the surrounding areas and the town itself.

It’s easy to do some initial desk research towards your due diligence. There is plenty of official and unofficial information out there for you to read from your computer at home. You can Google.com and Yahoo.com for the nearest town to source official and other websites. From these, you can uncover estate agents and letting agents and tourist offices etc. Wherever you are buying, the developer and their agents will usually say something like “prices here are going up by xx per cent a year”. See if local contacts agree; and particularly those who do not have a vested interest in saying so. If you are buying into a development, visit it rather than buying sight unseen. You should not really buy anything without seeing it. Even if the website, brochure and specifications all look good, you need to see the area for yourself. You may find, for example, that there is a huge patch of land between ‘your’ development and the sea. That’s likely to be filled in by the time the development is completed.

Looking for fast profits from capital growth?

Make sure you Can sell the property onwards at completion. A developer or agent will often tell you that it is easy to sell the property on or around completion to someone else so that you only ever have to pay out for the deposit. This may be true – but equally, it may not be the case. Your solicitor – always employ a solicitor before signing anything – should check the contract to see that it is assignable as and when you want; and that there are no hidden-away restrictions. You should also research to see that the property will actually be in increasing demand on or around completion. There are always various ifs, buts and maybes than can occur between now and then. There may be many similar units coming to market at the same time. The development may be incomplete. The expected infrastructure may not have been completed. The low-cost airline may have stopped its regular flights. Work through the possible ‘what if?’ scenarios and be sure you can
handle the worst case situation.

Do some due diligence on the developer and their agents.

Most are perfectly respectable and honest, although you should always bear in mind that they are trying to sell to you. So you can expect them to highlight the positives. You cannot expect them to showcase any negatives. But you should not have to listen to lies and half-truths. You can start by making various checks to see if they are well-known and established, are registered in the UK (so they are covered by UK legislation) and don’t generate any negative comments when you Google.com and Yahoo.com for them. You should also talk to them and follow through on what they say. Some common comments that often turn out to be incorrect are as follows. “There is no problem getting a non status mortgage” is often stated, but not put in writing, prior to you paying a deposit. Read the small print early on. “A new golf course/marina/other major attraction is to be built close by soon” is a favourite – but the development never gets built and the expected wave of tourists never arrives. Visit the local town hall!

Seeking long-term lettings and capital appreciation?

Be sure you can rent the property out after completion. The developer and their agents will tell you that you can easily rent that property out for most of the year. Few will put that in writing though or make any sort of guarantee. Of course the developer and the agent are selling the property so you need to check what they are saying is correct. If an estate agent in the UK told you you’d let a property easily, you’d check with local letting agents first. You need to do the same in an overseas market. If you are holding on beyond completion, number-crunch your finances as it may take several months to find a tenant. That’s especially likely if the development and infrastructure are incomplete or, vice versa, the development is complete and many similar units are available to rent. With a holiday let, you will do well to get a 60 per cent occupancy rate over the year. Number crunch your finances with three, four and five void months and/or 60, 50 and 40 per cent occupancy. Talk to other investors with comparable properties to see what they achieve.

Always get your own independent, professional advice.

Increasingly, developers offer you a complete package; a mortgage broker, a surveyor, a solicitor, and so on. All you have to do is to pay the deposit! Everything else is done for you and you can sell on completion and recoup your deposit and more besides. If only it were that straightforward and easy! If you bought a property in the UK, you would source your own mortgage via a broker anD would have your own survey and valuation done. You would not rely on the seller of the property to provide this information. Nor should you overseas. Similarly, you would not use the seller’s solicitor (especially if they put 100’s of deals via the solicitor and you are only doing the one). You may hear comments such as “No, you don’t need an independent lawyer – everyone uses ours. It’s quicker and easier.” Your own English-speaking solicitor who is close to hand is a must. The developer or agents will tell you, for example, “Of course the property has planning permission”. Your solicitor will check!

More to come on off-plan buying and other ‘hot’ topics such as fractional ownership shortly. Do also let us know what topics most interest you, which countries, and so on.

Streetwise Property Alert 27th March 2014

Welcome to today’s email…

Licences – More News

We don’t know how long it will take but we are pretty sure that the BTL/HMO licence issue is going to run and run, with more and more councils setting up schemes. There will come a day, not too far off, when you will have to get a licence from your local council when letting – and if you have, say, 12 BTLs across the county, you will need up to 12 licences.

Milton Keynes looks set to be amongst the next area to introduce licences according to local press reports. Let’s quote, ‘Licencing of the private housing sector could help Milton Keynes Council track landlords not doing their job properly. Councillors said that licencing would put HMOS not up to scratch more accountable and they felt landlords could easily afford it themselves without passing the fees on
to residents.’ More to come. Much more.

Value-Adders!

A good article has come over from MortgageIntroducer.com – good site, pay a visit – on increasing the value of property.

Space Is Key

Converting a loft can add instant value to a house. It may seem like a large project to take on but the returns for a conversion can take a property from a two bed to a three bed, which is a strong move. Dependent on property type and location this can cost anywhere between £15,000 – £80,000. This type of conversion has the potential to increase the value of a home by 10 – 20 per cent.

Central Heating

A home must be fit for purpose when it’s sold. Adding or updating the central heating system will add more to the value of a property than it costs. It will be considered a crucial selling point by most buyers.

A Lighter, Bigger Space

People who are looking to build a conservatory have the right idea about increasing the living area in their household in order to increase its value. The cost of a conservatory will set a client back between £3,800 and £10,000; averaging at around £6,236.

A Lick Of Paint

Getting potential buyers through the front door is a key factor. To give the outside a few coats of paint could cost anything from £100 to £1,000 (size dependent) but has the potential to provide a 400 per cent return on the initial investment. Painting the inside rooms a neutral colour will create a minimal clean feel, while giving the potential home owners a blank canvas to build an image of ‘their new home’.

Window Of Opportunity

Changing the windows can also be a solid way to guarantee value increase. However, bear in mind the windows must match the general aesthetic of the property. This visual aspect should factor into the decision process in this case. New windows have the advantage of insulation and contemporary design, however if the age and originality of the property requires a certain style of window your clients should be wary of jumping straight in as they could end up with a warmer yet uglier home.

A Lighter, Bigger Space

People who are looking to build a conservatory have the right idea about increasing the living area in their household in order to increase its value. The cost of a conservatory will set a client back between £3,800 and £10,000; averaging at around £6,236.

The Kitchen

As a showpiece this is a priority room. For many people the kitchen has evolved into the family room where most time is spent. The typical spend on a new kitchen is £8,000 but a good quality kitchen can be achieved on a much smaller budget. If money is tight and a full refit is not in their budget, suggest they consider changing certain elements of the kitchen such as cabinets and furnishings to give it a fresh new look.

First Impressions

It’s good advice to touch up the paint work and the flooring in the main reception room. Whether that is the corridor leading through to the house or the just the first room buyers step into. Sellers should de-clutter and create a tidy and presentable first impression for visitors. Many buyers are looking to move into a house that is ready and functional with little refurbishment necessary.

Knock Knock!

It’s amazing what people notice when they are viewing a property. The front door should tell them what they need to know about the interior of the house. It can make a big difference for your seller clients just by buying a new doorknob, letterbox or stainless steel house number.

This article came from Mortgage Introducer.com. Do check out the site now.

London – Some Figures

A five year outlook from Savills makes interesting reading; it suggests inner London boroughs will see 23.1 per cent price rises whilst other London locations will rise by 22.7 per cent. ‘The gap between prime central London and its prime commuter markets has probably peaked and wealth has finally begun to flow out of the capital. We have already seen the predominantly domestic markets of outer prime London out-performing prime central London over the past year and anticipate that 2014 will be the year when the value gap between London and the lead suburbs and prime inner commuter belt finally begins to narrow. ‘

‘A number of risks to the prime London markets, most particularly around Eurozone default, have receded over the past two years. But because the taxation of high value property is likely to be a contentious policy issue in the run-up to the 2015 general election, a lull in price growth in the period prior to polling day is expected.’

That’s it, see you on Friday.

Streetwise Property Alert 26th March 2014

Many of you are interested in buying off-plan property overseas. Here, to end the week, are some words of advice from Peter Esders…

Research the development, the surrounding areas and the town itself.

It’s easy to do some initial desk research towards your due diligence. There is plenty of official and unofficial information out there for you to read from your computer at home. You can Google.com and Yahoo.com for the nearest town to source official and other websites. From these, you can uncover estate agents and letting agents and tourist offices etc. Wherever you are buying, the developer and their agents will usually say something like “prices here are going up by xx per cent a year”. See if local contacts agree; and particularly those who do not have a vested interest in saying so. If you are buying into a development, visit it rather than buying sight unseen. You should not really buy anything without seeing it. Even if the website, brochure and specifications all look good, you need to see the area for yourself. You may find, for example, that there is a huge patch of land between ‘your’ development and the sea. That’s likely to be filled in by the time the development is completed.

Looking for fast profits from capital growth?

Make sure you can sell the property onwards at completion. A developer or agent will often tell you that it is easy to sell the property on or around completion to someone else so that you only ever have to pay out for the deposit. This may be true – but equally, it may not be the case. Your solicitor – always employ a solicitor before signing anything – should check the contract to see that it is assignable as and when you want; and that there are no hidden-away restrictions. You should also research to see that the property will actually be in increasing demand on or around completion. There are always various ifs, buts and maybes than can occur between now and then. There may be many similar units coming to market at the same time. The development may be incomplete. The expected infrastructure may not have been completed. The low-cost airline may have stopped its regular flights. Work through the possible ‘what if?’ scenarios and be sure you can handle the worst case situation.

Do some due diligence on the developer and their agents.

Most are perfectly respectable and honest, although you should always bear in mind that they are trying to sell to you. So you can expect them to highlight the positives. You cannot expect them to showcase any negatives. But you should not have to listen to lies and half-truths. You can start by making various checks to see if they are well-known and established, are registered in the UK (so they are covered by UK legislation) and don’t generate any negative comments when you Google.com and Yahoo.com for them. You should also talk to them and follow through on what they say. Some common comments that often turn out to be incorrect are as follows. “There is no problem getting a non status mortgage” is often stated, but not put in writing, prior to you paying a deposit. Read the small print early on. “A new golf course/marina/other major attraction is to be built close by soon” is a favourite – but the development never gets built and the expected wave of tourists never arrives. Visit the local town hall!

Seeking long-term lettings and capital appreciation?

Be sure you can rent the property out after completion. The developer and their agents will tell you that you can easily rent that property out for most of the year. Few will put that in writing though or make any sort of guarantee. Of course the developer and the agent are selling the property so you need to check what they are saying is correct. If an estate agent in the UK told you you’d let a property easily, you’d check with local letting agents first. You need to do the same in an overseas market. If you are holding on beyond completion, number-crunch your finances as it may take several months to find a tenant. That’s especially likely if the development and infrastructure are incomplete or, vice versa, the development is complete and many similar units are available to rent. With a holiday let, you will do well to get a 60 per cent occupancy rate over the year. Number crunch your finances with three, four and five void months and/or 60, 50 and 40 per cent occupancy. Talk to other investors with comparable properties to see what they achieve.

Always get your own independent, professional advice.

Increasingly, developers offer you a complete package; a mortgage broker, a surveyor, a solicitor, and so on. All you have to do is to pay the deposit! Everything else is done for you and you can sell on completion and recoup your deposit and more besides. If only it were that straightforward and easy! If you bought a property in the UK, you would source your own mortgage via a broker and would have your own survey and valuation done. You would not rely on the seller of the property to provide this information. Nor should you overseas. Similarly, you would not use the seller’s solicitor (especially if they put 100’s of deals via the solicitor and you are only doing the one). You may hear comments such as “No, you don’t need an independent lawyer – everyone uses ours. It’s quicker and easier.” Your own English-speaking solicitor who is close to hand is a must. The developer or agents will tell you, for example, “Of course the property has planning permission”. Your solicitor will check!

More to come on off-plan buying and other ‘hot’ topics such as fractional ownership shortly. Do also let us know what topics most interest you, which countries, and so on.

Streetwise Property Alert 25th March 2014

Welcome to today’s email of news and views…

Latest BTL Scam

‘Scam’ may be too strong a word but, from emails received from members this week, a pattern is emerging. See if this rings any bells. You are offered a BTL unit at an excellent price, no need to do any due diligence, no need to use your own lawyer, no need to even visit (d’uh, d’uh, d’uh) – it’s a perfect armchair investment. All you have to do is pay some money…a reservation fee…some mortgage and legal fees etc, no more than a few thousand, and it’s all yours!

Now, here’s what seems to be happening – a survey is carried out (at your expense) and the report comes back at £10,000 to £20,000 below the stated priced. Oh dear. Well, I never. Can we have our money back – the reservation fee, the mortgage and legal fees etc. A deathly silence…

If you are offered a BTL deal here’s what you do (I feel I need to speak very slowly and loudly here). You read what’s sent to you. You do your own desk research, zoopla, google maps etc. You visit! Go and see it – talk to estate agents and letting agents locally. Take some advice. Do your due diligence. Have a lawyer in place. Everything stack up? Not too good to be true? Then you look at proceeding and not before…

Rents – Onwards & Upwards

Move With Us reports that nine of 11 UK regions are seeing rising rents – the national average advertised rent is now £923 per month, up by more than £20 on February 2013. Advertised rents in Scotland saw the biggest increase of 3.96 per cent on the year, with the average now at £695.

‘2014 is shaping up to be a good year for landlords with rents increasing in most regions. The Council of Mortgage Lenders (CML) recently announced that gross mortgage lending was an estimated £15.5 billion in January 2014, a third higher than the same time last year when it was £11.6 billion. It’s likely that many of these mortgages have been granted to buy to let investors as we have seen a growing trend for people investing in property instead of using low performing savings account.’

‘The best places for investors however, aren’t necessarily where average rents are the highest but rather, the places with the highest rental yields. This means that, for example, the high rents in Greater London may be deceiving from an investment point of view. Rental yields actually tend to be better in places where property prices are lower like the North East, and the Midlands,’ he explained.

‘Any aspiring buy to let landlords looking to invest in property should follow the golden rules of finding a place with a good rental yield that is in a nice area and is close to local amenities and transport links. Landlords should also check that the property can easily be upgraded to meet the legally required energy performance rating that will be introduced in 2016.’ Food for thought but, of course, let’s not forget capital appreciation is as much a factor for many investors as rental yield.

Newcastle, Sunderland & Durham

I’m familiar with the Newcastle, Sunderland, Durham market not least because I looked to buy an apartment there when my daughter, Sophie, went to Durham University in 2011. I’ve kept up my research ever since, visited often, and regularly check what is coming through the system – at present, some expensive units in Durham (close to University), some okay-ish apartments in Newcastle and (in our view) not very good units in Sunderland!

We are, from April, going to do a region-by-region report for would-be buy-to-let investors and I think we will start with this corner of the North-East where there seems to be a lot of supply coming through, some is rather good and much is rather bad from what we can see. If you are looking to buy here, drop us a line for a free report, out around 9 April. You will need to register to receive this.

All for now, see you soon.

Streetwise Property Alert 24th March 2014

Our latest update is in from Peter, a.k.a. Mr Mortgages. Email back to talk to him.

admin@streetwisenews.com

The Budget

Not much of interest for mortgages and property in the Budget except the Help to Buy scheme has been extended from 2017 to 2020. I personally think that once the government started interfering with the property market, they will not be able to withdraw, putting the element of risk on the taxpayer instead of indemnity insurance companies. (You have to ask yourself, “Why would the insurance companies not underwrite the percentage of lending above 75 per cent loan to value of a client’s mortgage”. They used to; clients were charged an insurance premium such as ‘mortgage indemnity guarantee premium’ or ‘high loan to value premium’. Could it be the risk factor do you think? ). The other changes in the budget included an attack on people buying in a company structure. This especially affects offshore purchasers for high value property in London as they will now pay stamp duty land tax at higher rates than before. The general view is that prices in London may dip a bit when this comes in but will recover quite quickly.

I suppose there is a significant benefit on the horizon when people can get at their ‘pension pots’ in 2015. I can see many disenchanted pension investors pulling funds out as soon as they get to 55 and investing in property, which will strengthen the property market at the same time as providing the government with tax revenue and pushing up the money supply in the economy. Additional capital and business incentives were announced and together with the improved economic forecasts suggest that ‘affordability’ will start to rise for the first time in several years, again good for the property sector making rents and mortgage payments more attainable.

Off Plan Caution

Are you considering buying new build apartments as ‘contracts off plan’ where they should be completed in a year or two’s time? Selling agents are promoting many new developments with nice glossy brochures and detailed models and even a demonstration suite kitted out on site. Most agents offer a professional attentive service where you are cocooned within a pleasant suite of offices to discuss your purchase. However, remember, they work for the developer, not you, and do not be afraid to haggle.

Also be aware that once a new build has been sold, it tends to lose value (the new build premium goes when completed as the property is now classed as secondhand, a bit like buying a new car). This can be offset by buying ‘off plan’ where the deal is a genuine discount on today’s prices with the hope that, over the time it takes to complete the build, there will be an increase in value. However, you need to be careful here, If a large percentage of the new build is being sold off plan then, when they all complete, those contract purchase prices will be registered at Land Registry and that would be the open market value at completion as far as surveyors are concerned.

On the mortgage front, there are still some lenders that will allow 5 per cent grifted deposit from the developer on new builds, so this could be incorporated in the pricing structure to enable mortgage percentage to fit price. In short, completion finance would most likely be available (subject to changes in interest rates and product criteria ) Think the potential investment through and do your research of comparable values in the site post code and within ¼, ½ and mile radius, easy to take a look at Zoopla and Rightmove. Then assess the risk, do your homework. If, for some reason, suitable mortgage finance is not available to you at the time of completion (e.g. your circumstances change or no mortgage products fit) you could lose not only your deposit and reservation fee but the developer could sue you for breach of contract for the balance of price (very stressful, unless you can get a clause in the contract for sale that says, ‘subject to suitable finance being available’ to you – which is unlikely the vendor will allow. In addition, make sure there is a ‘long stop’ clause in the contract, this basically says that if the developer fails to complete the development within (say) six months of the target date, they will be in breach of contract and must pay you back you deposit and reservation fees with interest. (Again. many developers try to avoid having this in the contract).

Developers often offer cashbacks and other incentives (such as white goods, stamp duty and legal fees gifted deposits etc.) However all lenders now require a CML declaration form (provided by the Council of Mortgage Lenders) of all incentives and may deduct the aggregate value of these incentives from the price when calculating their maximum lending (loan to value). Some lenders will allow white goods, legal fees and stamp duty paid by the developer, but not all.

Generally, investors for new build, especially apartments, aim to get at least 15 to 25 per cent off the listed price, especially if they are registering to buy more than one apartment. It would be wise to instruct a major professional RICS surveyor firm to do a ‘desk top’ valuation on the basis of ‘if the apartment completed today, what would be the open market value?’ This will cost you a valuation fee, but you would then have a clear idea of value verses price before you commit and could save you thousands or confirm you have a good prospect.

Don’t get me wrong, I am not trashing new build apartments and the buying off plan process, there can be some good deals in a rising market, but there is much to consider and more risk involved than buying built property. When our existing clients are looking to buy, new or built properties, we carry out initial research for them and provide our ‘view’ at no cost (This is not indemnified professional advice under our indemnity insurance protection policy, but simply, from years of experience, our opinion. Some of our clients are re-mortgaging to release funds for their deposit on an off plan contract, having done their research of course. Next week, by the way, I will be looking at the buying at auction process.’

Want to talk to Peter? Email back and we will put you in touch.

admin@streetwisenews.com

Streetwise Property Alert 14th March 2014

Here we are again at the end of the week with more UK property news and views…

Auction Tips

Just been sent an interesting clipping from a local newspaper in Sleaford. It quotes Paul Collins of the Belvoir lettings and property management office in Lincoln, who talks about buying at auction. Let’s quote, ‘One of the main benefits of buying an investment property at auction is that the process is very quick as both the purchaser and the seller agree to complete the transaction in a few weeks. There are no chains involved. It is also possible to buy a property with a tenant already in place – providing an instant income as soon as the purchase is completed.’

‘You should never buy a property that has not been researched thoroughly. I would always advise viewing a property and having a professional survey done prior to the sale. The desirability and tenant appeal of the area it is located in, plus any obvious repair or maintenance issues required to bring the property up to a rentable standard, should always be taken into account before you start bidding.’

‘Before attending auction, buyers should do their homework to find the most appropriate national or regional auctioneers offering the kind of property they are interested in. Most auction houses can be found via a quick internet search and many will market upcoming lots on property portals. Local lettings specialists will also be able to offer advice and will often know of forthcoming auction dates and venues. They will also be able to provide an objective, professional opinion on the area, the street, the type of tenants that would be suitable and the anticipated rental levels that could be achieved.’

‘At auction it is important that potential buyers have their finances sorted out in advance. They also need to take into account any costs incurred on searches or legal enquiries before bidding. One of the biggest challenges when buying at auction is to stay calm and not get carried away with the bidding process. By gathering in advance as much research and information as possible, you will be able to set your own
limits for any lots you are interested in.’ Wise words. More to come? You tell us.

PCL Overview

Strutt & Parker’s quarterly report covering PCL, Chelsea, Kensington, Fulham, Notting Hill, Knightsbridge and Belgravia, shows sales and rentals are rising. ‘We have seen Chelsea, South Kensington and Fulham assemble the most diverse spectrum of international buyers, while Knightsbridge is highly attractive to those from the Middle East. Kensington & Notting Hill has changed from being a more domestic market to an overseas hotspot. South Kensington and Fulham also saw an increase in transactions values compared to 2012 (14.5 per cent) which is likely due to selling the largest quantity of flats since the peak
in 2006.’

‘The lettings market has proved equally buoyant. There were 13,752 property lets agreed in PCL during 2013, representing an 11.6 per cent increase on 2012 and surpassing the peak of 2009 by 8.2 per cent. The largest change was seen in the Knightsbridge & Belgravia submarket where house lettings increased by nearly 32 per cent compared to 2012.Lateral apartments and small family houses continue to be the properties of choice.’ More to come. We have a 12-page report coming for those serious investors looking to buy here; email for it.

admin@streetwisenews.com

Deposits – A Reminder

ARLA, the Association of Residential Letting Agents, reminds us today that you should keep an accurate list of all fixtures and fittings. It goes on, ‘Images detailing the property’s condition can help ensure there are no disputes at the end of a tenancy. Keep a written record: While images will definitely help in documenting the state of the property and contents, it is also useful to elaborate and explain the state of items in a detailed written description. This will help protect you if there is any dispute about the condition of items at the end of the tenancy.’

‘Be logical: To ensure you have covered everything and have the most comprehensive list possible, it is important to be logical in your approach in compiling an inventory. The easiest way to do this is by recording items by room; this will help you to compile an accurate and comprehensive inventory. Understand who is responsible for the overall upkeep of the property as well as the contents. This information should be in your tenancy agreement. This will help resolve any issues at the end of a tenancy where landlord/tenant duties were not specified. If in doubt use a member of the Association of Professional Inventory Providers (APIP): More professionalism and credibility can be added to the inventory if you use a fully qualified APIP member. Members of APIP are professionally trained in drawing up an inventory and conducting the check in and check out. All members have passed assessments to demonstrate their abilities.’ See Apip.org.uk.

The Rental Market

LSL Property Services reveals the differences in returns between owning a BTL property in different parts of the country. If you have a BTL in England or Wales the average return you’ve made over the past year, from capital growth and rental yield, is some £14,767. How does that compare with your property(ies)?

To show the spread, and to reveal yet again why the average is so misleading, you would have made £7,271 in the North East and £38,000 in London. If current trends continue, you can expect to make an average return of £22,000 a property over the next 12 months.

‘Demand remains strong in the rental sector despite signs that more people have been getting on the property ladder in recent months. Meanwhile, rising prices are delivering an equity bonus for landlords – considerably boosting total annual returns. Such equity growth is also an important factor for some landlords looking to remortgage existing properties to fund new purchases… many landlords will continue to expand their portfolios.’

Our Next Get-Together

Our Investing In 2014 seminar was judged a success but several investors, especially those who came along specifically to meet Adam beforehand, wanted some more one-on-one time. So, we are going to offer something less formal than a seminar – maybe a drinks get together or a curry night on a Thursday evening between, say, 6.30 to 10.30. Members can drop in and out of drinks as they please, talk to us and also to some fellow investors.

If this would interest you, drop us a line and we will tell you more. Given the costs involved and the fact that at least half who swear blind they’ll be there never actually turn up on the day, we will be limiting numbers to a round dozen for this first, trial, event and there will be a small charge for food and drink, at cost, probably about £20 a head. The know-how, expertise and access to exclusive deals – frankly, worth £1,000’s – all come free-of-charge.

That’s it, that’s all for today.

Streetwise Property Alert 13th March 2014

Welcome to today’s email…

Turkey- Who, What, Where?

We keep being asked the same question about Turkey – where are Brits buying? Recent figures from the Statistical Institute reveal the know-how. There were 1.1million property purchases in 2013 and about 1 per cent of these were by foreigners. Antalya saw the most overseas sales in 2013 at 5,548. Istanbul came next with 2,447 sales followed by Aydin at 1,112, Mulga at 1,053 and Mersin at 545.

Investors are looking at Istanbul. Julian Walker at Spot Blue, quoted in OPP Connect, says, ‘Buyers from the Gulf Co-operation Countries and the Middle East are purchasing in Istanbul. Everybody is buying property for an investment point of view. Thirty to forty years ago, people were not so conscious of this and the market has not grown as aggressively to make money. But today people are buying for a lifestyle purpose with an eye on investment.’ More to come? A show of hands please.

Upcoming New Service

I had a meeting with a financial whizz in London on Tuesday and it may be of interest to you if you are buying into the UK from overseas and want to know the best way to structure your purchase to minimise tax etc. Are you? Do you? Drop me a line and we will see if we can put you in touch with each other.

Weekly Currencies Review

The latest currencies review – sterling/euro – is due in from Peter Lavelle at Pure FX later today. If you’d like to receive it, and this is surely a must-read if you are exchanging currencies soon, please email back. We will send it on as soon as we receive it.

admin@streetwisenews.com

US – More Positives

Getting better – but a way to go yet! The latest report from Zillow offers more good news for the US property market; there are now 19.4 per cent of home owners in negative equity there; i.e. their mortgage is higher than the value of the property. That percentage has now fallen for seven quarters in succession. It was, at one point, close to 30 per cent.

‘We’ve reached an important milestone as negative equity has fallen below 20 per cent nationwide which has helped free up marginally more inventory and contribute to further stabilisation of the market. But a number of headwinds will prevent negative equity from falling at the kind of sustained, rapid pace we need before the market can completely return to normal, and it remains roughly four times what it is in a healthier market. High negative equity is just another sign of how distorted the market continues to be, and how far we still have to go on the road back to normal.’

All for now, see you on Friday.

Streetwise Property Alert 5th March 2014

Most of what we do here property-wise is done behind-the-scenes. Opportunities, small get-togethers, visits to sites etc – all are done without the free members knowing about it. That’s because we want to deliver the savviest members exactly what they want!

Take the recent example of a UK JV which was introduced to just 24 members. Here are the key facts…

A small development site of just 11 units.

£50,000 in.

12 to 15 month build-time.

50-50 profit share.

Estimated returns of some 28 per cent.

First refusal on investing in next project.

Of course, there’s lots more to it than that. Fact is, I’ve never seen so much clear and transparent documentation from a team that is as open and as detailed as I have ever met. In less than two weeks, nine members – each putting in £50,000 – have been taking up their places and we expect all of them to be through the system in the next week.

We will soon be repeating the process…

But we don’t want everyone to know about it!

You do, and here’s your chance…

If you might be interested in investing in the next UK JV, and have – this is very important – £50,000 to invest, drop me a line. We’ll then have a brief exchange of emails and hopefully add you to the waiting list for next time. It will then go quiet for a little while and we will – just as soon as we have another deal that’s not far off as promising as the first one (which really looks quite exceptional) – we’ll be in touch.

Reply now. Don’t miss out. As one of my colleagues said when one of the original 24 told us he did not have the funds to invest in this first JV, ‘A shame….this has been so popular…he’ll live to regret that.’ Make sure you don’t. Email today. Once we have the names of 24 serious investors with £50,000 each, we will close the list…

admin@streetwisenews.com

Streetwise Property Alert 4th March 2014

Welcome to today’s news and views …

Spain – ‘Stunning Villa’

Last week’s property introduction ‘Just in from Nic and straight out so at least one member will be happy…’ was taken within 24 hours; no more replies for that please!

Florida – The Reality

Wayne Levy, a registered real estate broker, is quoted in the media about the state of play in Florida. There are still bargains to be had although, across the board, prices are up. ‘If you’re looking to be on the water, in brand-new construction, for under $100,000 or $200,000, you’ll be happy you read this today because I just saved you $500 on a plane ticket!’

‘Last year we told people, ‘We’re starting to see increases in prices,’ and it has happened. Miami is almost back to where it was before the crash. Orlando is still very affordable, we sell a lot of condo/hotels there – they are great because for a client who wants to put their foot in the door, who is not ready to retire yet but wants to use it. Orlando condo/hotels work this way. An owner can leave the unit empty, use it themselves, or put it into the hotel management programme – let them rent it out for you and you get a cheque every month.’ Interested?

Email to find out more.

admin@streetwisenews.com

Winter Olympics – The Effects

Our friends at OPP Connect have an article out suggesting that France is the winner of ‘Property Gold’ following the Winter Olympics. They quote MGM agent Richard Deans – and yes, noted, an agent, who praises France ‘Lettings in our leaseback properties are at exceptionally high levels this season and inevitably there are a number of skiing families who want to stay in a place of their own next year, rather than pay rent. The sustained improvement in the exchange rate, with more than €1.2 to the pound, has combined with the UK’s brighter economic outlook to give would-be buyers the confidence to act now.’ We are at work on an article covering ski properties, leasebacks and leading ski resorts; email if you are looking to buy into these sectors.

Visit! Visit! Visit!

We’d always urge anyone buying property overseas to visit before parting with a single euro. Fact is, so many of these properties on offer in Spain are pitched cleverly to offer huge discounts (based on off-plan valuations from 2007), amidst lovely surroundings (based on a PDF full of artists’ impressions) and great services (based on what was expected back when the development was planned six years ago).

I’ve been sent a copy of (the key points of) the most recent census in Spain which suggests some 3.4m homes, about 15 per cent of all properties, I’d estimate – are empty and a further 500,000 are half-built and left as they are. Chatting to an agent in Spain this week, he estimated some ‘very popular’ resorts have on average about one-third of their units half-built or empty. Some resorts, from where we are sitting, have higher percentages. Those of you of a certain vintage will recall 1970’s movies, Carry On, Are You Being Served etc, where the characters visited the ‘Costa del Plonka’ (typically) and everything was half built, half staffed and half-cocked. It’s not that different these days on some of these resorts.

Property Databases

We now have access to two databases in Spain with what appear to be some excellent BMV deals. I am looking at a couple myself in Calpe. Are you looking to buy in Spain? Send us your main requirements and we will see what we can source for you.

Timing Is Key

I’ve been sent a copy and paste article by Laura Parsons at Torfx.com (if I should have acknowledged anyone else please email me and I will add a correction from you next time out). Some interesting points are made when it comes to transferring money to buy that property in France. Let’s quote, ‘While banks are able to transfer funds overseas, they usually add on transfer fees and commission whereas currency brokers will carry out the same transaction at no cost to you. Banks also rarely secure clients the best exchange rate available, and this can lead to them losing out on thousands of pounds.’

‘For example, when buying a property priced in euros the exchange rate you are able to secure can make a huge difference to how far your pounds will stretch. After the eurozone returned to growth in the second quarter of 2013, the euro strengthened considerably, resulting in a difference of seven pence per euro between its highest and lowest points across the year. While seven pence might not seem like much, when you’re transferring the kind of sum involved in a typical property purchase the right exchange rate can have a huge impact on your wallet. If your dream home costs €250,000 it would set you back £202,500 if you moved your money across at a rate of 81p/euro. However, if you made your transfer when the exchange rate was at 88p/euro that same house would cost you £220,000. That’s £17,500 more!’ Email for more details and how-to commentary.

All for now, as ever, feel free to email back.

admin@streetwisenews.com

Streetwise Property Alert 3rd March 2014

Welcome to the latest round-up of news and views…

BTL – Calculating The ROI

We’ve been talking to various BTL investors lately – they are testing a new service for us behind-the-scenes (more soon) – and it is interesting how investors seem to use different calculations to assess their ROI, return on investment. The basic measure that is quoted most widely is income divided by the investment multiplied by 100. So, if you have a basic BTL and the rent is £5,250 and the cost was £100,000, the yield is 5.25 per cent.

Of course, would-be investors will then talk about gross profits, net profits, mortgage borrowings, cash put in, extra costs incurred, void periods and so on. Personally, I’ve always taken the net profit at the end of each year and compared that to the cash that I put in in the first place; some of you, if I left it there, would then chide me for not mentioning that the property price, and therefore the equity in the investment, may have gone up or even down over the past year and that I should really compare the net profit against the cash/equity that is still in the investment; if I put in, say, 20 per cent cash at the outset, the net profit in relation to that may be quite good. But if I effectively have 40 per cent cash/equity in there, it may be less impressive and I could maybe do better elsewhere. An endless debate! More to come; we are just taking soundings from different correspondents – lots of different opinions – and will have an article soon for newcomers.

Brazil – 20 March Seminar

Some of you, who have already invested in Brazil, have asked if you can come along to the 20 March event. Yes, please do! It is a good chance to meet Adam and the team, get an update, compare notes with fellow investors – we always encourage new investors to chat to old investors – and have a drink with me before or after. Email for details.

admin@streetwisenews.com

Weekly Currencies Review

The latest currencies review – sterling/euro/US dollar – is in from Peter Lavelle at Pure FX. If you’d like to receive it, and this is surely a must-read if you are exchanging currencies soon, please email back. We will send it on.

admin@streetwisenews.com

Latest Introductions

Two for members today…

Tottenham – freehold house currently arranged as two flats and fully let. Estimated market value £530,000 – 10 per cent discount for quick sale – cash buyer preferred.

Yorkshire – freehold block of 10 modern apartments. Individual break-up value of circa £650k from RICS report. Fully let. Quick sale required at £550k.

2 per cent finder’s fees required on both. Email for details. Please, no daydreamers.

admin@streetwisenews.com

London 500k Reminder

If you are replying to the 70-30 JV opportunities introduction in London, please do make sure that you have £500k. This key criterion seems to be causing some confusion with some members as we have had a stream of replies this week beginning along the lines of ‘I don’t have £500k or anything like it but would like to get involved.’ Apologies -you can’t.

London – PCL Overveiw

Strutt & Parker’s quarterly report covering PCL, Chelsea, Kensington, Fulham, Notting Hill, Knightsbridge and Belgravia, shows sales and rentals are rising. ‘We have seen Chelsea, South Kensington and Fulham assemble the most diverse spectrum of international buyers, while Knightsbridge is highly attractive to those from the Middle East. Kensington & Notting Hill has changed from being a more domestic market to an overseas hotspot. South Kensington and Fulham also saw an increase in transactions values compared to 2012 (14.5 per cent) which is likely due to selling the largest quantity of flats since the peak in 2006.’

‘The lettings market has proved equally buoyant. There were 13,752 property lets agreed in PCL during 2013, representing an 11.6 per cent increase on 2012 and surpassing the peak of 2009 by 8.2 per cent. The largest change was seen in the Knightsbridge & Belgravia submarket where house lettings increased by nearly 32 per cent compared to 2012.Lateral apartments and small family houses continue to be the properties of choice.’ More to come. We have a 12-page report coming for those serious investors looking to buy here; email for it.

All for now, as ever, feel free to email back.

admin@streetwisenews.com