Build Progressing on Weston Resort Barbados
As many of you will know, Weston in Barbados has been our most successful development to date. After being recommended this development by a client of ours we have successfully transformed this developer’s sales focus to investment as well as holiday home buyers.
At first glance, Weston seemed like a low priced development, one back from the sea front with sea views to many apartments, perfect for holiday makers but with no obvious investment characteristics.
However, after digging further we realised that it’s low prices and fantastic position mean’t room and occupancy rates could be set at a premium and even on a 20 week occupancy would provide yields a lot higher than many other competitors.
Fast forward 6 months and we are now due to launch our 3rd development in Barbados, both Ixora and Weston having sold out in record time.
Weston is due to complete in November/December 2011 and build is progressing nicely.
Above is a picture of the front of phase 2, about where the swimming pool will be, coming along nicely…
Back corner of phase 1 ground floor with sea views possible, 1st and 2nd floor views should be fantastic!
Back corner of phase 2 with the sea viewable, a lot of the apartments in phase 2 will have sea views thanks to the height increase between phase 1 and 2.
This will be the view available from 2ft below where apartment 7-6 will be on phase 2.
As construction progresses we will bring you pictures from the 1st and 2nd floor showing even better views. The sea is just 200 metres from the entrance to Weston meaning the beach is only 5 minutes away.
There are still 3 apartments remaining for sale:
1 bed sea view apartment – £166,050*.
2 bed sea view apartment - £209,100*.
4 bed apartment – £265,680*.
* Subject to exchange rates.
If you want further details please contact us on info@freshinvest.co.uk or call us freephone on 0800 043 69 56.
The Changing Face of Cape Verde
It wasn’t long ago that you could be mistaken for thinking that certain parts of Cape Verde were akin to a desert…
With little infrastructure and no direct flights from most European countries, Cape Verde as a holiday location was only for the most hardcore of travellers.
Fast forward a few years and Cape Verde presents a very different image. None more so than Sal.
Being only 5 and a half hours from the UK and now benefiting from a direct flight from many major cities there is little doubt that Cape Verde is the future winter holiday destination for most of Europe.
Through increased interest and build Cape Verde have been able to push more money to the infrastructure of the country, building roads and bringing power and water facilities up to European standards.
Cape Verde is now being talked of in the same breath as the Canary Islands and the Caribbean as a winter holiday destination. This is in no small part due to a handful of developers that have managed to build affordable quality property that offers high yields and low entry costs.
With the Completions of Villa Verde and Tortuga Beach Resort slowly but surely the face of Cape Verde is changing.
Tortuga Beach Resort brings the first of three 5* hotel resorts to the Island, all operated by world class operator Sol Melia, the quality of these properties have to be seen to be believed.
Many overseas developers promise a lot and deliver little, this is certainly not the case with Tortuga Beach, with the development going live to the public next month pictures of the finished product are now available for all to see.
Located right on Cape Verde’s famous Ponta Preta Beach, many apartments and villas have direct sea views and easy access to the beach and beyond.
The emergence of hotel companies managing developments built and sold on to investors is fairly new and as with every walk of life, as time flows these precesses are refined. I say this because there are plenty of developers that build with the intention of bringing a 5* hotel company in to manage but only a handful that actually manage it.
9/10 the hotel company realises the increased cost in terms of added specification of doing this and decided to go it themselves or attract a lesser hotel company to do this for them. Not in this instance! Sol Melia is well known for it’s 5* brand and it’s evident that Tortuga Beach Resort fits into this perfectly!
With a 5* Hotel branding also comes the benefit of increased specification and leisure facilities:
Tortuga’s Features and Benefits include:
- Stunning beach-front location
- Occupancy density of less than 25%
- 12 luxury front-line single storey 4 bed detached villas
- 40 luxury two storey 3 bed detached villas
- 306 two bed apartments
- 358 properties in total
- Two communal pool areas
- Lush green landscaped gardens
- Luxury 5-Star Hotel
- Apart-Hotel facilities for all villas and apartments
- Superb 150 seat restaurant
- Elegant Wine Bar and Piano Bar
- Luxury Spa and state of the art Gymnasium
With only limited availability left on this stunning development you may look towards this developers next project, Dunas Beach Resort. Ready at the end of next year and with build already underway you can be assured this will be bigger and better than it’s predecessor!
Or if you prefer, wait for Llana Hotel and Spa, the developers third resort which is due to be released next month.
Whichever you choose, Cape Verde as a destination is here to stay and these three developments will become a massive part of it.
Winter Sun on your doorstep!
As the days get shorter, winter closes in and the thermals re-appear many peoples thoughts turn to their chosen winter sun retreats. For many it is the Caribbean , others the U.S, some Dubai and a few even further afield!
Lets face it, we live in one of the least sunny countries out there but i don’t know many people that don’t run for the beach at the slightest sight of sun!
Ask any of the holidaymakers what the worst part of their trip was and i guarantee most will say the flight. Unless you are an Oligarch, paying £10,000 for a first class seat to Barbados is well out of their budget. So there you are, packed in like a sardine for your 10 hour flight….God its bringing back memories as i write this!
But we have no choice i hear you say!
Well actually you do, what if i told you that guaranteed sun is only the length of Les Miserables away and you probably haven’t even considered it!
Today as i write this Cape Verde is a balmy 29 degrees and sunny….the same temperature as Barbados, but in Barbados it’s raining!
Don’t get me wrong, i love the Caribbean, i have an apartment there. The difference is, i couldn’t go to Barbados for a long weekend!
I love the idea of hopping on a flight out of Gatwick and within 5 and a half hours i’m sitting on a beach in 29 degree heat! For someone who likes to take his holidays in short sharp bursts instead of long marathons it just makes sense.
It seems i’m not the only one, Tourism numbers are expected to hit over 500,000 this year from just 150,000 3 years ago!
With increased tourism inevitably comes increased flights and hotels, with 2 new Sol Melia hotels named Dunas Beach Resort and Tortuga Beach Resort under construction and a further named Llana Beach Hotel and Spa due to start construction in March next year, Sol Melia certainly believes in the longevity of the Islands.
You can now fly out of most major European cities including London, Manchester and Birmingham.
For those of you thinking of investing in a holiday home, properties on Dunas Beach Resort, Tortuga Beach Resort and Llana Beach Hotel and Spa are available to buy.
With investors able to purchase at one of these 5* resorts with just £33,000 it’s no wonder they have already sold 80% of their first 2 resorts.
Being part of Sol Melia’s 5* brand means all resorts will have an impressive list of amenities including numerous swimming pools, tennis courts, bars, restaurants, spa facilities etc…
We have are proud to say we are one of The Resort Group’s oldest agents so if you are thinking of investing, pick up the phone and we’ll talk you through the opportunity.
What is the future for Cape Verde?
Cast your mind back a few years and Cape Verde was the “buzz word” with many overseas property investors.
Year round sun, economic grants, low prices and the promise of increased tourism mean’t the future looked bright!
The last 2 years have seen highs and lows for this particular country.
The slow down and in some cases obliteration of many countries economies has indeed affected some of the developments in Cape Verde.
Personally i think it weeded out the developers who were indeed sailing a bit too close to the wind! With any overseas property investment, the scariest part for any purchaser is the chance the developer dissapears with your hard earned deposit.
Well i would argue that any developer still building on Cape Verde has definitely seen the worst of it and if they are still building now you can feel fairly sure you’ll have a property come completion!
A point worth considering …… Cape Verde still has year round sun, they are still taking advantage of economic grants, their prices haven’t really changed and you can now fly direct from most european capitals!
I’d argue the title “the caribbean for europe” is still warranted, after all i haven’t seen any other countries rising from the waves recently!
In fact, in one way its definitely better than the Caribbean, no hurricanes!
So if you do invest there, what are your options.
Well for me there are 2 and they depend on what you want to get out of your ownership.
1. You just want a holiday home and won’t want to rent it.
Maybe your best option is to buy either an apartment in a smaller resort or alternatively a residential property.
Pro’s
Cheaper
Can decorate it as you wish
Can buy now
Con’s
No swimming pool
Tennis Court
Restaurants and Bars on site etc…
Doubt over the quality of the build
No security
No management
2. You want something you can use but also want to derive an income from.
It’s worth considering a property on a managed 5* hotel resort.
Pro’s
Large list of communal activities inc…
Swimming Pools
Tennis Courts
Spa’s
Restaurants and Bars etc…
Fully Managed
Security
Needs to comply with 5* european standards so spec will be high
Higher rental can be charged
Marketed for you
Ready for you when you arrive
Con’s
Probably more expensive but can be easily mortgaged
Need to specify your dates to visit in advance
Management costs
If like me you want the benefits of owning a property abroad without the drawbacks of actually having to manage it then option 2 is for you.
The Resort Group is one such developer, they have 2 existing developments, Dunas Beach and Tortuga Beach Resort. These are both 5* hotel resorts which can be invested in for under £34,000!
These 2 developments offer 1 beds apartments right up to 4 bedroom sea front villas.
Another option is to wait for The Resort Groups latest development, Llana Beach Hotel and Spa. Details are limited at the moment but the site is again beach front and will be nestled neatly between Dunas and Tortuga beach Resort.
If the past is anything to go by, Llana Beach Hotel and Spa will definitely stir the emotions, The Resort Group has made a name for itself in Cape Verde by offering affordable holiday property on a 5* resort that is not out of reach of the standard investor!
We are taking expressions of interest for Llana Beach Hotel and Spa now, so to be first in the queue please contact us.
Llana Beach Hotel and Spa – The Resort Group’s Latest Project
Following the massive success of Tortuga Beach and Dunas Beach Resort, The Resort Group will launch Llana Beach Hotel and Spa early next year.
The Resort Group seem to be transforming the face of the island of Sal in Cape Verde single handed!
As you will remember, Tortuga and Dunas Beach Resort offered guaranteed returns on deposits, fully managed properties in a 5* Hotel Resort.
With Dunas and Tortuga Beach Resorts, investors could choose from purchasing fully in cash, whereby they would benefit from an additional 15% discount, or deposit options of both 35% and 45% with a mortgage on completion to cover the remainder. Investors could even invest with an existing pension through a SIPP.
Many of our clients decided to utilise redundant pensions that were not giving them the returns they had expected, they spoke to our SIPP provider who moved various pension pots into one Self Invested Personal Pension scheme.
Payment plans on the new resort are likely to be just as innovative as before, so we are waiting with baited breath!
As with all Overseas Property Investments it pays to invest early and benefit from the capital growth that this will bring with it, as more and more investors jump on board through the build period, prices will often rise quickly.
For further details on overseas property investment opportunities please contact us!
We at Fresh Invest are happy to be a main agent for The Resort Group and as such, will be offering Llana Beach Hotel and Spa, the moment it becomes available… so register your interest with us ASAP!
The West Coast of Barbados. So good I purchased there myself!
One of the benefits of being the director of a property investment company is that you generally get first dibs on the property opportunities you source!
For years this has helped some of us acquire good sized property portfolios. We generally need them as not many of us have pensions!
Now over the last few years the property investment market has got increasingly hard to operate in, there simply are not the funds that there were a few years ago. This means that we all have to be a lot smarter about where we invest, we can’t just take a chance!
Well as of yesterday I am the proud owner of apartment 6 block 4 at the Weston Resort, Barbados.
I thought I would write a brief summary on why I decided to invest here as opposed to any of the other investment opportunities we are offered on a daily basis.
1. The Location
In a market where yield really is king, I make sure I concentrate on areas that are already established. Areas that I know people will holiday at no matter how dire the financial market is. For me the West Coast of Barbados has this.
The types of people that regularly holiday here are not bothered that their mortgage rate just crept up a few percent. Most probably don’t have mortgages!
2. The Developer
Another important point for me is the quality and financial stability of the developer.
I have met the directors of Candelisa on numerous occasions, in London and at their fantastic glass fronted offices in Leeds.
I know that they have the facility to not only build this out but also deliver it on time.
3. Its Rental Return
I have holidayed in Barbados before so have an idea of the amount you pay to rent on the West Coast.
Before offering Weston to yourselves, we took some time to delve into rental values in the area, as well as reading through the information provided by the developer. We found that with just 38% occupancy a return after mortgage payments of over £10,000 per annum was achievable. This amount of return in such a quality area is almost unheard of.
In the UK you would not expect the same amount of rental return in Kensington as you would in Manchester, at Weston we have achieved exactly that!
4. Its Re-Sale Value
The final straw came when I conducted further comparable research on competitors resorts in the area. Quite simply, nothing came close.
The fact that I could purchase a 2 bedroom apartment within walking distance of Royal Westmoreland golf course at just £200,000 sealed it for me. Especially when I realised they were selling 2 beds at Royal Westmoreland at over £1m! The closest comparable I could find was over £50,000 more expensive!
5. My Long Term Goal
I don’t actually plan to visit Barbados in the near future, I will put my apartment in their management scheme and plough the profit back into the mortgage. I have worked out that I should be able to clear the mortgage in just over 10 years taking into account renting for just 20 weeks out of 52. If I manage to rent for 40 weeks out of 52 this is reduced to just under 4 years!
Why have I mentioned this?
I know if I was looking at purchasing abroad, the fact the guy offering me the property was in the same boat would definitely give me some comfort.
As of today there are just 11 apartments left at Weston. (One just came back to market)
4 X 2 bed apartments (1 with sea views) Invest from just £62,000.
4 x 3 bed apartments (3 with sea views) Invest from just £78,000.
3 x 4 bed apartments (1 with sea views) Invest from just £92,000.
Remember these are selling quickly, the sooner you come back to me the sooner we can secure your chosen apartment.
Act now or forget your pension
Pensions, Savings, Isa’s….
What do all of these have in common?
Well other than shocking returns, the chances are that over half of you are relying on one of these come retirement.
Forgive my scepticism, I can only talk from past experience, you see I’ve got a share portfolio which I’m looking to for a pension, I’ve had this for 7 years and rather than make me any money, it’s actually fallen 3% in value.
The news is full of programmes investigating the current financial crisis; no avenue of investment seems to be safe.
Panorama recently investigated the vast fees and commissions some pension companies take from their clients, in one case a lady’s net return over 21 years was just 3%…it would have been 4% if she had not been paying various charges!
Now I’m sure that there are other pensions that would return her a larger sum but as she pointed out, how do you know which are any good?
Well the answer is, you really don’t…
Why Property?
For years I have tried to educate clients as to the benefits of investing in property as your pension. Not only do you benefit from any rental returns after mortgage payments but you will also over a number of years, benefit from capital growth.
It has been widely documented that property prices have taken a tumble in many locations, however if you buy smart and at a good price you massively reduce your risk.
The average pension pot in the UK is around £33,000; now for many of you it may not be too late to do something about this.
Below I will show you a simple way to make your money work for you in property.
Let’s take a 35 year old male that wants to retire at 55.
- Purchase a 1 bed apartment for £150,000. (Multiple locations across the south coast)
- Deposit needed £30,000 (20%)
- *Repayment Mortgage over 20 years = £735 pcm (4% interest rate)
- Rent PCM = £750 pcm (average for this price and location)
- Management Cost £75 pcm (10%)
- Additional payments = £60 pcm.
*Remember this is a repayment mortgage, not interest only, the long term goal is to pay this mortgage off over 20 years.
If you look at the £60 as your pension payments, in 20 years time you will have a pension pot worth £150,000, not taking into account any growth; giving you a return of £750 pcm.
Now the chances are that there will be capital growth during this period, if we take it at just 5% per year, your property will be worth £397,995 in 20 years time.
Rental also historically increases over time, if we take 5% here as well, your £750 would be worth £1,990 pcm in 20 years.
In Conclusion:
When investing in stocks and shares, it is extremely hard to get an idea of what they will be worth come retirement time. Brokers and IFA’s will bombard you with figures, but for the most part it’s a shot in the dark.
One thing that not is historical data on property and rental growth, this can be proved, as can the UK’s desperate need for more property and the demand for rental property in certain areas.
Many of you probably own a house and have done for a number of years, cast your mind back 20 years and recall the re-sale and rental values then. See what I mean?
In short:
- £30,000 investment in property now
- £60 pcm top up
Should provide you with…
- An asset worth £397,995 in 20 years time
- Income of £1,990 per month.
The Alternative:
Keep ploughing money into a product you’re not in control of and you probably don’t understand.
For information on how you can make your pension work best for you contact Fresh Invest on 01243 527327 or email info@freshinvest.co.uk.
Barbados Bound – Why Celebrities flock here year on year!
Michael Winner, Simon Cowell, Philip Green, Trevor Eve, Richard E. Grant, Amanda Burton, David and Victoria Beckham, David Frost, Lulu, Andrew Lloyd Webber, Wayne Rooney, Jemima Khan, Hugh Grant and not forgetting Cliff Richard and Cilla Black!
What do all these people have in common?
They all either holiday or have property in Barbados.
So why is this Caribbean island the second home location of choice for all of these celebrities?
I think firstly it is the idea of security, you are in the Caribbean but as long as you stay on the west coast you are never far from a cocktail bar, mulit million pound house or exclusive golf club.
Over the last 15 years the West Coast of Barbados or the Parish of St James has risen from relative obscurity to command the name ” the platinum coast”. It is now widely known as one of the most exclusive and expensive areas to live in the world.
With the cost to stay at the exclusive Sandy Lane Resort coming in at around £40,000 for a week over Christmas this location is certainly not cheap!
Expect to pay roughly the same in Barbados as you would in central london for dinner at a top restaurant.
So after all of this, why does tourism in Barbados continue to grow year on year?
Well actually its kind of because of this, the average joe would rather pay more to be near these kind of celebrities, they will probably never meet Michael Winner strolling down Sandy Lane beach but its the prospect of this happening that keeps people enthused.
And for the celebrities, its like a home away from home, at Christmas around Sandy Lane the same celebs come back year on year, they all know each other, they know the restaurants they can go to unhounded, they know the areas they can sunbathe without being papped!
Why would this change, the celebs can afford to holiday here, prices can increase as much as you like, your not going to price any of the above out of the market!
So what about the average person?
Well there are still some areas where you can pick up property at reasonable prices.
Just 5 minutes from Sandly lane and 2 minutes from The Royal Westmoreland golf course is Weston Resort, prices here start from just £180,000 for a ground floor 2 bedroom apartment. Fully furnished and ready to rent you are probably looking at £200,000. With mortgage available at 65% loan to value and only needing a 35% deposit you can buy one of these with just £63,000!
With possible rental yields of over 10%, not only could you afford to buy it but it would actually make you money year on year. Compound this with the fact you could safely holiday in this every year and remain fairly exclusive (under 50 apartments on this development) and you begin to imagine why this scheme is nearly sold out with around a year till completion.
For more information on how you can invest alongside the celebrities of barbados call 0800 043 6956 or email info@freshinvest.co.uk.
My top 5 places to invest for 2010 – Part 2!
As you saw in last weeks blog, i delved into my top 5 places to invest in property for 2010.
The first 3 were Cape Verde, Barbados and Barcelona.
Below are the last 2, and perhaps the most interesting.
4. Mallorca:
Known to many, invested in by few….
Mallorca is one of the most visited islands in Europe, most of us have been there be it on a lads holiday or a family one!
What many people don’t know is that because of building restrictions prices have not been effected by the global downturn anywehere near as much as their close neighbour Spain.
We have a villa in Puerto Pollensa and in 15 years have not seen it lose money, also long term lets are easy to obtain in the winter, it yields around 11% per year AFTER mortgage payments!
Combine this with an average 3 weeks use per year and it looks like a great investment.
As the cost of far away holidays spiral and many long haul operators upping prices or going under altogether, holidays closer to home tick boxes for many people.
The fact that more and more people are buying second homes in Mallorca combined with laws on future building means that prices are sure to steadily increase in the near future and with a vibrant holiday market rentals will follow suit.
Conclusion:
Risk = Low
Returns = Medium
Yields = Medium
Minimum cost to invest = £30,000
5. The UK
Well you knew it was coming didn’t you!
Ok the returns may not be as much as the countries mentioned earlier BUT many of you will have the market knowledge to know a “good deal” when you see it.
In this market many property investors that do look to invest are loking at minimising their risk as much as possible, for the masses that means not moving out of their comfort zones.
I’ll always tell you that using a property investment company is the way to go, they charge very little, normally get paid by the developer and have market knowledge and contacts that can only be gained by years in the business.
We have seen some really great stock recently, from tenanted apartments in Chorley yielding over 8% to townhouses in Chichester (where we are based) yielding close to 9% when let to students under an HMO license.
Check out our UK property investments for more information.
Conclusion:
Risk = Low
Returns = Medium
Yields = Medium
Minimum cost to invest = £20,000
To Finish……These are my 5 places to invest in 2010, i would hope that by 2011 i will have invested in at least 3 of them. If you have a location you are looking at and a reason why, post it below!
My top 5 places to invest for 2010 – Part 1
The property market in many countries has taken a real hit over the last few years, however this sometimes is not a bad thing.
If your looking at property investment as an alternative to stocks and shares then the time may be ripe to invest.
Below are my top 5 places to invest.
1. Cape Verde:
When looking for an overseas investment opportunity the first thing you should always ask yourself is “would i go there”. If the answer is no, the chances are your not in the minority.
The next question is, if you would go there, why?
For me Cape Verde offers a unique proposition, 360 days worth of sun that you can access via a 5 hour flight.
Combine these 2 points and it narrows the field down considerably; quite honestly the competitors i’ve either been to or i’d never want to.
The reason for this is as follows, not only does Cape Verde have a Caribbean climate but also a laid back lifestyle unlike many of its competitors.
The Prices are still relatively low compared to the likes of Tenerife and some Caribbean islands, this is mainly due to the infancy of the islands that make up Cape Verde.
This will not be the case for long, already some major 5 star hotel operators are building on the islands of Sal and Boavista, this will increase tourism and put more pressure on Airline operators to increase their flights.
One such 5* hotel operator is Sol Melia – the worlds largest hotel resort operator, they are taking over the running of our Dunas Beach Resort investment opportunity.
Conclusion:
Risk = Medium
Returns = High
Yields = High
Minimum cost to invest = £33,640.
2. Barbados:
If you have deeper pockets abd want slightly less risk then Barbados may be for you, offering the true 5* lifestyle with prices to boot.
The reason i think this is a good investment is that even though prices are high, you can still achieve yields in excess of 10%, as witnessed in our opportunity on the West Coast Barbados.
Yields this good along with the knowledge that you are investing in the holiday makers favourite Caribbean island means that occupancy rates should remain strong. Most other Caribbean islands are so far behind that no threat to this crown seems anywhere near appearing.
Demand is Barbados is so high it has become the place for celebrities to have second homes, as proved by a host of premier league footballers, golfers and tv personalities.
Conclusion:
Risk = Low
Returns = Medium
Yields = High
Minimum cost to invest = £64,990.
3. Spain – Barcelona:
I love Barcelona, its my favourite city by a long ways.
Sea, Sun, Football, Great Beaches, Great Nightlife andf now a grand prix! I don’t know another city that offers so much.
I also think its a bit of a hidden gem, 1 bed apartments on the outskirts of Barcelona can be picked up for around €160,000 and if you can rent them for 40 weeks of the year you should be on for close to a 8% yield. Not bad for one of the most cosmopolitan cities in the world.
Demand will always be strong because of the sheer size and climate of Barca.
Combine this with the fact that house prices in Barcelona have hardly been effected by the global financial crisis and you know that values will remain robust in all but the most dire of circumstances.
Conclusion:
Risk = Low
Returns = Medium
Yields = Medium
Minimum cost to invest = £27,111
Too see what numbers 4 and 5 are, click here!
What will the election mean to the property market?
This election could mean boom or bust to the already fragile property market in the UK.
As we all know, possibly the largest challenge facing the new government will be our economy. The 3 big parties have outlined the steps they will take to try to deal with the £170bn deficit in the UK’s finances.
With it looking increasingly like a hung parliament, what will be the main points of debate from these parties on our property market?
Listed below are some of the key points of each party.
Conservative:
- Scrap home information packs
- Keep the £250,000 stamp duty threshold for the foreseeable future
- Add a new 5% stamp duty threshold for £1m properties from April 2011
- Increase inheritance tax threshold to £1m
- Regards Northern Rock, they have not stated whether they will consider remutualisation
- Include more local initiatives rather than large scale regional building plans
- Will look to split state and part owned banks into 2 parts, retail and investment
Labour:
- Add a new 5% stamp duty threshold for £1m properties from April 2011
- Keep the homebuyer direct scheme for low earners
- Keep Home Information Packs
- The £250,000 stamp duty threshold is due to expire in March 2012
- 10,000 affordable homes to be built a year by 2014
- Northern Rock: Manifesto pledge to consider remutualisation as an option, ‘while ensuring the sale generates maximum value for the taxpayer.’
- Will look to break up large banks but probably not into retail and investment
- Maintain the standard interest rate on the Support for Mortgage Interest Scheme at 6.08 per cent until December 2010.
Liberal Democrats:
- Charge VAT on new homes
- 1% “supertax” on homeowners with properties worth over £2m.
- Create a new “Safe Start” mortgage that keeps buyers from slipping into negative equity
- Propose a green loan for people to invest in home energy efficiency and micro-renewables
- Get rid of home information packs and keep energy performance certificates
- Consider remutualisation regards Northern Rock
- Will split state and part owned banks into retail and investment
- Concentrate on local rather than large regional building plans.
Fresh Invest is a property investment company with the aim of maximising our investor’s funds whilst minimising their risk. For more information see www.freshinvest.co.uk or phone 0800 043 69 56.
Lack of property boosts asking prices
I’ve done it again!
If you remember i blogged in september regarding a lack of supply leading to increased prices, well it seems mortgage solutions agrees……better late than never! See their article here.
I personally i think they missed the biggest point which is the slow down in new build development. But you get the same result.
We still have a few new build developments with discounts available, if you are looking for a property investment click the link!
Another option is to buy a student property, some of our wealthiest investors specialise totally in student accommodation investment. A couple of them have yields close to 20% on massive portfolio’s!
Some investors don’t like the hassle of student property but if you have a management company set up all you need to do is collect the profits!
Dunas Beach Resort, What our investors say…
For months we have been talking about how great an opportunity Dunas Beach Resort is, it has obviously worked as we were overwhelmed by the amount of interest we have had in this overseas investment opportunity.
We thought prospective investors may like to hear what previous buyers had to say about this investment.
Mrs Carole Winters – Shrewsbury.
“In 2009 we approached Fresh Invest initially looking for a holiday home, we had a budget in mind but were aware that we were stretching ourselves, however we knew that if we did not buy now then we may never have!
Over the next month or so i had various conversations with Dan regarding various properties in various locations. In the end we settled on Cape Verde and Dunas Beach Resort. We loved the idea that we could invest in a good size 1 bed apartment with just £32,000. We were also very interested in the equity release scheme which mean’t that we used £30,000 worth of equity in our home and topped up the £2,000 ourselves!
Seeing as we had set aside money to buy the flat, to know that we could use equity in our house was a massive relief to us.
Dan gave us a financial breakdown on the apartment based on comparables in other developments showing that we should look to make at least £6,000 per year after all costs including mortgage payments. He also showed us what we could mortgage the property for on completion, at the moment it looks as if we should actually be able to pull out all of our deposit on completion!
We have decided to enter into the hotel agreement meaning that Sol Melia will take care of all rentals ensuring we get the best rates for our apartment. We also get 5 weeks use of the apartment for free.
Since then we have found out that Dunas Beach has been upgraded to a 5* resort which was great news.
I have to admit the investment was a little daunting in the first instance but once we got our heads around it the process started to make sense.
Now we are looking forward to a lovely apartment that has cost us £32,000 that we didn’t even know we had and receiving 5 weeks use and £6,000 per year! thanks Fresh Invest!”
….Just one investor that took advantage of the various money saving options on Dunas Beach Resort!
Spending cuts for universities….Great News for investors!
The UK Government has announced they are looking to implement spending cuts in the region of £350m for the 2010/2011 academic year.
Now many people may think this is a major set back to investors investing in student accommodation, but in actual fact that could not be further from the truth.
What this actually means is that Universities have to concentrate their funding on their core facilities. For instance, up keep of their academic buildings is obviously very important, where as building accommodation for students is secondary.
You may argue that without the accommodation, attendances will drop. Actually this may not be the case.
What the university is hoping for is that third party developers will step in and build for them.
This has always been a much maligned area for Universities because they know that the more accommodation they own, the more revenue they will generate.
Problems arise when spending is cut, they can’t afford to develop so are almost completely reliant on commercial developers.
In short, third party commercial developers have the universities over the proverbial barrel!
Take a look at our Student Property Buyers Guide for more information!
Cape Verde Looks to the Future
Known by many as “The European Caribbean”, Cape Verde is showing signs that it could be Europe’s saviour when it comes to affordable holidays with year round sun or overseas property investment.
With the credit crisis hitting most, holidaymakers are looking closer to home. Spain and the Canary Islands have both seen increases in tourism as well as many locations in the UK. However, if you really want year round sun in a secure location Cape Verde has to be at the top of the list!
Now Cape Verde is looking to boost tourism by implementing a Tourism Strategy Plan which will aim to increase tourism by 500,000 visitors by 2013.
Between the year 2000 and 2008 the total holidaymakers visiting Cape Verde rose by 11.4%!
This plan has been given the green light by ministers and looks set to boost tourism sector employment by as much as 60%!
This will obviously have a knock on effect for holiday apartments and villas, many average builders have fallen by the way side leaving some select developers to take up the baton. None more so than The Resort Group and it’s Dunas Beach Resort, the first developer in Cape Verde to sign up with a 5* developer. Sol Melia is the largest resort hotel group on the planet and their 5* hotels are widely recognised as some of the best in the world.
The best part is that you can purchase an apartment on this select development from just £72,326.
Deposits needed are just 35% so just £27,986 gets you an apartment in a 5* resort in Cape Verde; due to be the best hotel resort on the island! Check out Dunas Beach Resort Now!
Conclusions of 2009 – Opportunities for 2010
2009 – A year when then the smart investor used their time to set them up for 2010.
I think you will be in the minority if you haven’t suffered some kind of hardship this year, many investors have seen thier dreams of retirement severely set back.
This has not been confined to property, if you had shares or your money in some banks you could be in a worse situation!
So what should this year have taught the average investor?
1. The only way to build a profitable portfolio for the long term is by investing smart.
For me that means keeping at least 20% worth of equity in any property so you build yourself a buffer to combat any drop in values.
Investors have been stung by dropping loan to value rates, an unwillingness by lenders to remortgage on to rates previously offered has seen investors have to increase the equity in their properties, leaving them severely stretched.
Over the last 2 years i have seen investors with portfolio’s worth in excess of £100m go bankrupt, how can this be i hear you say.
What some property investors seem to misunderstand is that if you have a portfolio worth £100m, with lending on it of £90m. You actually have a portfolio worth £10m. If property prices drop 10%, what is the worth of your portfolio…Nothing!
If this happens you are entirely reliant on the income that your portfolio brings in, investors too highly geared normally cannot withstand more than a couple of months of empty properties.
2. Property Investment is not a get rich quick scheme – investors that use it as such usually find they have leveraged too high.
I am one of the biggest exponents of flipping property, i think that if you have the time and the know how it is possible to make decent profit this way but it is entirely dependent on a couple of factors.
Firstly, you need a massive amount of knowledge of the local market, this is not something that can be learnt quickly, so for this reason either keep to one area or find yourself a property specialist that you trust completely.
Secondly, always have another exit strategy, so if you are buying to re-sell, make sure that if worst case you can’t do this immediately, you can let the property out and pay your mortgage that way.
I have refurbed properties for over 6 years and we are also in the middle of developing apartments, i value every property investment opportunity by the number of exit strategies it provides.
3. The good times will come again, use times like these to research the market and decide where the best profits will be made next year and in the future.
If i could focus on the single most important factor i have taken from 2009 it’s that within the next month or so the vast majority of new build developers will completely run out of stock.
At Fresh Invest we are in contact with all major new build developers and 9 months ago all of them decided to stop all build that wasn’t already past footings. This decision was made because the last thing the market needed at that point was more new build stock. They are all building again now but this has created a back log where all finished sites have been sold and the next tranche of stock is still around 6 months away.
We have seen average discounts reduced from 40% 9 months ago, to 15%-20% now, and thats if you can find any stock. We have 2 developments left on our books which are selling at around 2 a day.
The first 6 months of 2010 will see property prices increase due to a lack of supply and increased demand as more confidence seeps back into the market.
I would take the first few months of 2010 to pick up the last pieces of good quality discount property around, there is only 1 way values are going to go in 2010.
New Opportunities through Fresh Invest:
1. We are launching a scheme that should give clients access to lender stock, for property investors looking to pick up great quality buy to let property in a particular area this is the one!
2. We are working hard on some student schemes, these should yield over 8%, have really low interest rates and start at around £80,000. With massive demand and industry professionals flocking to this market this is definitely one for the future!
Student Property Report 2009-2010
In a market where many investors have seen rental voids, capital values decrease and Ltv rates decrease, why are many of the UK’s most renowned investors focusing on Student Accommodation?
If you look at the simple economics, student accommodation really does sell itself.
In short, you can purchase a property that will rent at a much higher value to students than an equivalent unit would to a private individual. You also do not have the downfall of rental voids! In fact, many landlords are filling their units 6 months in advance!
Many investors want hands off investments with high returns and no rental voids.
If this is you, look no further.
Demand:
Where rental demand in the residential sector is prone to peaks and troughs, student number have continued to rise from 1.8 million in 1996-97 to approaching 2.4 million in 2009-10*.
Indeed early indications are that the economic conditions have led to even more people looking to higher education.
UCAS data revealed that UK university applicants rose 10% between 2008 and 2009 and overseas applicants rose 13.6% during the same period.
“Overall student numbers are likely to remain stable and in the medium-term there is unlikely to be a substantial uplift in student places as caps remain in place. However, the expectation is that the proportions of both overseas and postgraduate students will continue to grow, underpinning future demand for private professionally managed halls.” Knight Frank
Supply:
Private Student Development is still made up of the 4 main service providers, UNITE, UPP, Opal and Liberty Living. The majority of students have to rely on halls for their accommodation with a small percent benefitting from access to private operated rooms.
Many university run halls are found to be outdated and lacking in necessary facilities. This creates demand for private accommodation but with development finance so hard to come by, this accommodation is nowhere near keeping up with demand.
“Student Numbers are growing at 15 times the rate of new supply in London” Savills
Prospects:
Student accommodation rents have increased by 5% p.a for the last 6 years with growth increasing right into the 2009/10 academic years. Compare this to residential and commercial rents which have both fallen overall during this period and you start to understand what makes this market so appealing.
“Student Housing delivers income during uncertain economic times” Savills
As student accommodation is commercial by class this has also seen an increase in values, this sectors robustness is highly attractive to a growing number of investors who want high capital growth that can be depended on for the long term.
Even in the midst of a global downturn occupation levels for good quality purpose built private accommodation is close to 100% with rental levels for 2010 predicted to increase by at least 5%.
Yields and Values:
Although the rentals gained have not been hit by the credit crunch, one side that has been impacted has been the finance student developers have been able to find. Because of a lack of this many new build schemes have not got off the ground.
If we factor this and the fact that university applications have steadily increased we have a demand/supply scenario which is drastically in the favour of the buy to let investor with student property in their portfolio.
Compound this with the fact that many universities cannot afford to build the necessary accommodation themselves and we have a scenario where these same universities cannot grow to their potential because of this lack of accommodation.
Universities have always relied on private developers to make up the deficit that their own student halls cannot fill.
With many student developers not building because of the lending constrictions, small investors are starting to fill the void with new build 4/5 bedroom houses. These normally comply with the rigorous build accreditations and rent for a lot more than residential lettings.
Through this lack of supply yields have risen steadily and values have followed, we envision this to be the case for the foreseeable future. The student market is continually growing and with many universities operating on shoestrings it falls to the private student developers to build in their place.
How we can help:
You will have seen by previous posts, blogs and emails that Fresh Invest have faith in the student market as a valid buy to let option.
For this reason we are due in the very near future to bring you a selection of landmark student pods which can be bough individually as “completely hands off” investments.
These properties will come already tenanted with high yields and great commercial mortgage options.
Below is an example of a property we are close to agreeing an exclusive for.
Financial Example.
1 bed student pod – First Floor – From £90,000
- Deposit Needed – £31,500
- Rental achievable – £541 (£125 per week)
- Mortgage – £58,500
- Mortgage Payments – £138 pcm (RBS, 65% LTV @ 2.83% Tracker)
- Service Charge and Ground Rent: £70 pcm
- Positive cashflow of £333 pcm!
Register your interest for these opportunities here.
As lending relaxes property investment increases!
It’s what most of us have been waiting for, the small time frame between lenders relaxing their criteria and property prices increasing.
We all knew that lenders were going to need to increase their loan to value rates, and that when they did it would make a massive difference to the property investment market.
Over the past few months half decent rates had been reserved for investors with 40% deposits. Now i do not condone most no money down deals, i think they lead to more problems than they alleviate.
However! the case for the investor with a healthy 20% deposit should be heard, they have a large amount of equity in their property and should now be relatively safe from negative equity.
It seems the lenders now agree.
What are the new rates like?
Since the BOE base rate reached 0.5% products requiring a 15% deposit have risen from 169 to 231. And the number of products requiring just 10% upfront has gone up from 89 to 105 in the last month alone.
This is certainly a massive difference to a year or even 6 months ago.
Nationwide has already announced a new influx of deals, including some at 85% loan to value and they have also released some of their best rates at 70% ltv, from their previous at 60%.
They have even released a special 90% ltv rate for investors that hold one of their flexaccounts. These start at 4.63% for a 2 year tracker.
The Woolwich have also released details of their new 75% ltv rates, this is the first time the lender has made it to 75% for at least a year. The new mortgages include a lifetime tracker on 2.94% and 2 year fixed on 3.99%.
Abbey also have a new range out, these are exclusively for their current account customers. One of their best is a 90% ltv 3 year fixed rate at 5.99%, their cheapest mortgages are now available at 70% from 60%.
So why the sudden change?
It seems that lenders now believe that the worst is behind us, in short if they are offering 90% ltv mortgage they believe that property prices will not drop more than 10%, in fact they believe that prices will increase in the future, as now being reported in most news channels.
Just last month hsbc pledged to lend an extra £500m at 90% ltv by the end of this year!
Add this to the political pressure being put on lenders by the government, this was summed up by the governments own lending house northern rock as they released some of the best ltv rates seen for over a year!
So should i buy now?
If you are looking at getitng into property investment there has never been a better time to invest, there are still seller under pressure but now there is also the promise of some competitive rates. This means that not only can you buy cheap, you can also borrow cheaply!
We don’t expect this to remain the case for long so why not add or start your portfolio with some discounted property now!
Also check out our UK Buying Guide for handy hints and tips.
With stability grows confidence!
Shopping at the weekend I was amazed at how busy all the shops were, now I know it’s christmas and all that but perhaps this could be the final piece of the puzzle that will lead to us climbing out of recession.
It does seem for the first time in months that the public are not as worried as they were about the economy.
According to the times, people are more optimistic about the economy than at any time over the last 18 months.
What are the reasons for this?
- We have just had the highest october high street sales for 7 years.
- The pound rose to it’s highest level against the dollar.
- The ftse closed up 92.5 points, at a two week high.
- Alistair Darling is looking at cutting business taxes to encourage people to have faith in labour.
What do people think about these facts?
Is this a result of the “quantitive easing” which we (the public) are going to be penalised for after the elections?
or
Is this the start of Britain pulling itself out of recession?
Could the points above be the catalyst that leads to us out of our economic quagmire?
What does this mean for the property investment market?
In my opinion it means that the worst is now firmly behind us, the increased confidence on the high street coupled with the low supply of new build property coming on the market means robust values.
Investors can now take advantage of a unique position in the property investment market. There are still a small amount of reposessed property and good discounted new build units available which if bought now are sure to increase in value over the next year.
Investors purchasing these can then re-mortgage on much better loan to value rates.
The property investment market is ripe at the moment, will investors choose to invest or wait until the moment has passed and lament on a missed opportunity?
As always, we will probably see both.
If you want details of some of our UK Buy to Let Opportunities at the moment please let us know, they are selling fast!
Property Investment – Why you actually have no choice!
I have noticed many of our investors are holding off investing in buy to let property, instead choosing to make doubly sure that the market is on its way to a recovery before jumping in.
Not a bad idea, it certainly mitigates your risk in the property investment market.
But! are you not missing out on the very time when developers are looking to do discounted deals?
Developers are no different from us, they want to make as much profit as possible which means getting the very best price they can.
If you want to sell your car, your only going to discount it if you really need to.
If suddenly all other cars dissapeared and yours was one of the only ones available you would think you were on to a winner and charge top whack!
This is what will happen with new build property soon. The property investment market is recovering and new build property supply is decreasing!
Soon 20% discounts on new build property will only be available in the very worst developments or the largest bulk opportunities.
When this happens it will be no use complaining you have missed the boat, it will have sailed and you will face the choice of not investing at all or paying top prices for buy to let property.
If you have £20,000 spare at the moment you have 3 choices as far as i can see.
1. Leave it in a savings account.
You will probably achieve 3% on your money but it is relatively safe.
2. Invest it in shares.
But what shares? most people have probably seen their share portfolio’s decrease by at least 30% over the last year so do you want to risk it again? even if you do only the very highest risk shares wiull give you the kind of returns that you can expect from a buy to let property.
3. Buy to Let Property Investment.
Just this week we have sold 15 units in 2 different developments, one in Gravesend in Kent, £21,000 into a mortgage gets you a return of 8% and clear profit of £300 per month. One in Salford costs £20,000 into a mortgage and a return of nearly 9% with profit of £330 per month.
Most of these units are already let, one of our bulk purchasers rented 5 apartments in Gravesend in one day. We only offer property in areas where we know there is high demand.
We are seeing more investors buy now than for many years, all of those that are not have to ask themselves why not? Are you perhaps missing out when others are taking advantage of this unique situation?
We know 2 things for definite.
1. The property market will recover at some point.
2. The yields you can achieve today are some of the highest we have ever seen.
These 2 points make it impossible not to at least consider property as an investment strategy.
Quite simply, if you want a good return on your money with little risk and the prospect of high capital growth do you really have a choice?
3 Reasons why you should start investing in property again.
Property Investment….over the last 18 months probably the furthest thing from your mind!
So why start investing now?
1. Mortgage rates are relatively low.
Ok so the ltv rate isn’t great but the actual rates are pretty good and with our economy suffering i believe there is little chance of the boe base rate increasing.
An average 65% ltv mortgage on a new build flat is around 5% with second hand property mortgages available from 75% at 5% rate.
In historical terms the rate is a lot lower than it has been for a long while.
As ever, if you are building a property investment portfolio you need the mortgage rates to remain fairly low to allow you to repay the mortgage loan, another up shot is that when buy to let mortgages recover the ltv rates will increase, allowing you to remortgage.
2. Property supply is at an all time low!
With most new build developers choosing to stop building last year we now face the fact that it will take these housebuilders a year to get new schemes out of the ground.
This will mean that for around a year from now new properties will be some what of a rarity. New build property accounted for a massive part of the property bought last year, without this supply and with increasing demand prices are sure to increase.
UK Property Investment has always relied to a large part on developers willing to discount their property for either bulk sales or quick completions but if they have no stock….
3. It’s cheaper to buy than rent.
Recent research has shown that for the first time in ages it is actually cheaper to buy than rent, well outside of London anyway!
Abbey found the average rent of £434pm compares to a mortgage payment of £382pm (with a 25% deposit). That’s a saving of £52pm. People in Wales and the north west would save on average £90pm. We can also overpay or save whilst interest rates are low.
So for those looking to start in property investment now looks like an ideal time.
Hotel Managed Resorts – The key to overseas property investment.
We all have heard the horror stories that some overseas property investors have experienced.
Developers going bust, part finished developments, shoddy workmanship, differing specifications…the list goes on.
So how do you negate these risks?
In my opinion the answer is by buying on a hotel managed development.
We offer a number of overseas property investments that will be managed by successful hoteliers on completion and have been overwhelmed by the stringent regulations that these hotel companies put in place prior to completion.
For most overseas developers, the pinnacle of success is being able to sign up a world renowned hotel operator to take over the day to day running of your development.
Many developers try and fail, taken back by the sheer level of attention to detail the hotel operators need developers to adhere to.
On average a hotel operated development would need:
- Higher specification
- Much more amenities i.e. public space, leisure facilities
- Higher standard of customer service
- Bigger room sizes
- Larger patio’s or balconies
- Better site locations
- Regimented time scales regards completion
Many investors are put off investing overseas by the unknown, lacking the know how to conduct the desired level of due diligence on their chosen development.
If a developer signs up with a 5* hotel operator the finishing must be exactly that….5*!
If investors have any reluctance in investing in an opportunity where a hotel operator is included, take a look at their other hotels, this is the standard that they must maintain.
For instance, the hotel operator in talks with The Resort Group on Dunas Beach Resort is called Sol Melia. Sol Melia is the largest hotel resort operator in the world with over 120,000 hits on their reservation systems per day!
Dunas Beach will be part of their Melia package meaning 5* plus, so for an understanding of the finish needed take a look at their other hotels in the Melia package.
It may be in the best interest of a developer to cut corners and save money but I can assure you that there is no way that a 5* hotel operator would accept this.
Also bear in mind that all of the developers we use retain an interest in the commercial elements of each site they build, so making the very best development possible is the only way to drive people to the development there by making money on the commercial sales.
Many investors may know all of these points but I think they are worth focusing on to alleviate some scepticism that goes with a lot of overseas developments.
I predict it in september, the halifax and sky news predicts it in october!
Looks like my predictions were true, as the halifax reported on october 6th – article.
If you remember i wrote an article last month predicting that with most developers only just starting to build again there will be a massive drop in supply of property.
The Halifax states “a combination of increased demand and a shortage of properties on the market had pushed prices up in recent months”.
Now i think we all know that this increase is definitely due to ease, its supported by a lack in supply but against that you need to show an increase in unemployment and a definite lack of competitive mortgage products.
My further prediciton is that we will see a mini blip in prices followed by a mini crash then probably stability for the future.
My predictions for the next 12-18 months…
Wow, what interesting times we live in! Property Prices seem to be on an elaborate rollercoaster depending on the area that you live.
One day prices are rising, the next falling, i think the property investment market needs some stabilisation so investors can find their legs again!
Personally i think this may be right around the corner.
I believe that for once the government may have actually got the result that they wanted, even if they will achieve it in a way i doubt they could have expected!
What do i mean?
It’s quite simply a matter of demand and supply and it’s one which could impact us all so pay attention!
Around 12-15 months ago the vast amount of new build property developers stopped starting new developments and started land banking. No property developer would start a site that they thought would actually lose them money!
This was fine at the time, there were more than enough new build developments going to keep most property investors happy, in fact if we are honest there were probably too many!
It’s easy to say that the UK needs to build x amount of housing to keep up with demand, but if that housing is mostly luxury apartments in city centres, way out of the price range of joe bloggs then it does not really equate!
What we are now seeing is the end of many large property developers redundant stock, most sites are now finished and developers are just about to start building again.
This will dramatically impact on property investors and property investment companies, how? because for the next 12 months + we will see little to no new build developments being offered.
“What of all the off plan deals” i hear you say.
Well if you put your hand in the fire and it gets burnt, you don’t go back for a second go do you?
If developers start offering off plan opportunities that is exactly what they will be doing!
It is a lose lose situation for a developer.
- They offer the property off plan and the prices continue to rise – Result – they have lost out on potential profit.
- They offer property off plan and prices drop – Result- what seemed a smart bet turns into disaster as property investors decide not to complete as the promised 25% discount has been eradicated by price decreases!
Summary – Developers can’t win!
So we are faced with developer not offering discount on their property until they have completed the site and explored every other selling option!
This has to be at least 12 months from now for even the quickest builders!
So what would i do?
Buy now!! Were on the way to a mini price rise where property investment demand suddenly rockets past supply!
If you can get it right you can grab the last of the good discounts now and sell or remortgage in 12 months time when prices have risen.
