World wide rental property
Discussion
Gents.
i'd be interested in some opinions on the best places in the world to buy rental properties. Income stream from rent is the main driver here. Capital gain, whilst nice to have, is of secondary importance although of course both would be nice.
Looking for residential or commercial, budget around £200,000 plus. Nowhere dodgy or unstable. Seen some interesting figures from Detroit and Chicago, any other ideas?
i'd be interested in some opinions on the best places in the world to buy rental properties. Income stream from rent is the main driver here. Capital gain, whilst nice to have, is of secondary importance although of course both would be nice.
Looking for residential or commercial, budget around £200,000 plus. Nowhere dodgy or unstable. Seen some interesting figures from Detroit and Chicago, any other ideas?
Agreed. A few minutes of due dilligence reveals lots of too good to be true property investments in depressed areas of the States. No doubt the same scams are readily available in non English speaking parts of the world making them even more of a hazard for the gullible who don't understand the lingo.
I don't know about the best but Australia must be about the worst. The gross yield on our house there is about 3.5%, out of which we have to pay agents fees, a $15,000 land tax bill (like council tax on steroids but charged at a different rate for non owner-occupied property), mortgage etc. The capital gains and keeping a toe in the market have made it worth hanging on to so far but as an income generating proposition it sucks.
If you are feeling adventurous why not leverage into listed property in the U.K? A number of good trusts / REITs out there paying 4%+. With 50% leverage at, say, 2.5% (or less if you don't fix) even assuming the interest is not deductible one can get to around 6%. E.g. £100k into Tritax big box, 100k into f&c commercial property would get you approx 9k. a year in divs against 2.5k of interest so 6.5% net. No ongoing costs, no agents fees. First 5k tax free if you don't have other dividends. You need to keep an eye on the loan to value etc and one would obviously diversify more than just a couple of stocks but all up I think there's an opportunity to take advantage of the low rates for a couple of years in this sort of play. Clearly not a play for the widows and orphans but I bought some tritax with borrowed money shortly post brexit and so far am very pleased that I did.
If you are feeling adventurous why not leverage into listed property in the U.K? A number of good trusts / REITs out there paying 4%+. With 50% leverage at, say, 2.5% (or less if you don't fix) even assuming the interest is not deductible one can get to around 6%. E.g. £100k into Tritax big box, 100k into f&c commercial property would get you approx 9k. a year in divs against 2.5k of interest so 6.5% net. No ongoing costs, no agents fees. First 5k tax free if you don't have other dividends. You need to keep an eye on the loan to value etc and one would obviously diversify more than just a couple of stocks but all up I think there's an opportunity to take advantage of the low rates for a couple of years in this sort of play. Clearly not a play for the widows and orphans but I bought some tritax with borrowed money shortly post brexit and so far am very pleased that I did.
cowboyengineer said:
Can I suggest student property in Bath.
I think the ship has sailed a bit with that.Most of the student houses that come up for sale are massively overpriced and low yield.
Then with the planning changes, it's mostly impossible to get planning in the popular student areas. So then you're left with something on the outskirts of the popular areas and will probably have to settle for smaller rents.
That and house prices have gone bonkers, so it's hard to get anything worthwhile where the numbers stack up.
I did notice this the other day - http://www.rightmove.co.uk/property-for-sale/prope...
Outside the planning area, I think, and with some jigging downstairs, could easily make a 3 bed, possibly a 4 bed, but would need a lot spending. House of that age probably has no internal load bearing walls, so can all be redone.
4 rooms at £400, 12 month contract, £19,200 a year. 7.6% against £250k. Not too bad.
I currently have some student properties in Plymouth which I have been pleased with. They have outperformed my HMO's in the town, the last of which is in the process of being sold for that reason. My initial intention was to buy another student renter, but due to the building of large purpose built student developments right next to the Uni, the market has really tightened for private landlords and you need to have a house in the "Golden Triangle" to compete. Luckily my properties are in that area, but of course no more are coming onto the market as landlords like myself hang on to them. Plenty of stuff outside the triangle but now doubtful if they will remain viable, hence the fact i am looking to cast my net wider. Hull is looking good but i am a bit twitchy about the consequences of Brexit when it comes to investing in more UK property right now, hence my question about places abroad.No doubt all will become clearer with Brexit as things develop but it's all going to take a long time. I don't want the money burning a hole in my pocket in the interim.
Russwhitehouse said:
I currently have some student properties in Plymouth which I have been pleased with. They have outperformed my HMO's in the town, the last of which is in the process of being sold for that reason. My initial intention was to buy another student renter, but due to the building of large purpose built student developments right next to the Uni, the market has really tightened for private landlords and you need to have a house in the "Golden Triangle" to compete. Luckily my properties are in that area, but of course no more are coming onto the market as landlords like myself hang on to them. Plenty of stuff outside the triangle but now doubtful if they will remain viable, hence the fact i am looking to cast my net wider. Hull is looking good but i am a bit twitchy about the consequences of Brexit when it comes to investing in more UK property right now, hence my question about places abroad.No doubt all will become clearer with Brexit as things develop but it's all going to take a long time. I don't want the money burning a hole in my pocket in the interim.
They've built a load of new halls in Bath as well, which can only be a good thing, as it means first year demands are still high, which means 2nd year/private accomodation will be in demand as well.Most students don't like living in halls, either. So if it comes down to a nice private house at £120pw v halls at £160pw, I expect 90% would take the private house.
This government does seem to have it out for landlords at the moment, regardless of leaving the EU. I would still take a property in this country over another, though. It can be a right ballache here, even with a good agent. I can't imagine how badly things could go wrong with a bad agent abroad.
Russwhitehouse said:
soxboy said:
Mixed use investment in England, in decent enough area, 7.5-8% yield. No enhanced stamp duty as it's classed as commercial.
Sounds far too complicated looking at overseas.
Interesting. Could you elaborate some more on mixed use?Sounds far too complicated looking at overseas.
Residential buy-to-let in the UK is collapsing. Taxes are rising. The UK's two biggest private landlords are selling up. The ship has sailed.
Overseas property is fraught with high risk and hidden costs. Wild currency swings, unexpected legal changes by politicians seeking votes, local corruption, hidden local taxes, remote burglary, etc. etc.
Much easier, liquider and un-riskier to pick a global property fund listed in London and invest by proxy.
Overseas property is fraught with high risk and hidden costs. Wild currency swings, unexpected legal changes by politicians seeking votes, local corruption, hidden local taxes, remote burglary, etc. etc.
Much easier, liquider and un-riskier to pick a global property fund listed in London and invest by proxy.
Great capital gains made in Berlin for those with the sense to invest there a decade ago. Nice conservative and non-volatile rental market too. Good longevity of tenancy from a high proportion of decent tenants.
UK still strong high demand market for rentals. Legislative changes mostly for the better tho' tax regime currently favours the unburdened (which most, I believe, are anyway).
UK still strong high demand market for rentals. Legislative changes mostly for the better tho' tax regime currently favours the unburdened (which most, I believe, are anyway).
Edited by drainbrain on Tuesday 20th December 23:53
drainbrain said:
Great capital gains made in Berlin for those with the sense to invest there a decade ago. Nice conservative and non-volatile rental market too. Good longevity of tenancy from a high proportion of decent tenants.
German market is great at the moment. Great yield and strong capital gains as the market rises. Be very aware of tenants rights though. Not that easy to move a tenant on (especially if they have children). We bought several when the Euro was 1.44 to GBP earlier this year. Not so attractive now though if you need the money in the UKEdited by drainbrain on Tuesday 20th December 23:53
https://www.bloomberg.com/gadfly/articles/2016-03-...
Russwhitehouse said:
The money doesn't need to be kept in the UK, in fact quite the opposite, hence my interest in overseas. If tenants rights in Berlin are anything like here in France, then you are right. One needs to tread very carefully before taking them on.
Yep. we're quite lucky with ours as they all want long term tenancy, some 5 year or 10 year contracts which suits us. Should you need one, mortgage rates in Germany are quite aggressive. We needed a one on the last property we bought and managed to get 1.4% fixed for 10 years (in line with the rental agreement which pays the property off) That said, most German banks wont lend to you if you're not working, residing and earning in Germany
Edited by Candellara on Wednesday 21st December 16:55
Slagathore said:
They've built a load of new halls in Bath as well, which can only be a good thing, as it means first year demands are still high, which means 2nd year/private accomodation will be in demand as well.
Most students don't like living in halls, either. So if it comes down to a nice private house at £120pw v halls at £160pw, I expect 90% would take the private house.
This government does seem to have it out for landlords at the moment, regardless of leaving the EU. I would still take a property in this country over another, though. It can be a right ballache here, even with a good agent. I can't imagine how badly things could go wrong with a bad agent abroad.
The new PBSA developments being built are not exactly halls. Halls are pokey 1 single bed and a chair width desk, if they are lucky a en suite bathroom. Have a look at the private owned student accommodation being offered to investors. Self contained studios, own bathroom, kitchenette, double bed and a bit of space.Most students don't like living in halls, either. So if it comes down to a nice private house at £120pw v halls at £160pw, I expect 90% would take the private house.
This government does seem to have it out for landlords at the moment, regardless of leaving the EU. I would still take a property in this country over another, though. It can be a right ballache here, even with a good agent. I can't imagine how badly things could go wrong with a bad agent abroad.
Students in 2nd and third years are choosing to spend 160pw for their own space, no sharing facilities and then being able to use on site gyms foc, socialise with 100 other students in the games room etc.
£120pw for a bedroom in usually a old house with a bit of damp, taking shifts on the bathroom and having to deal with messy housemates doesnt seem worth the few quid a day. Then you have the fact the PBSA will be closer.
Students are far from the penny pinching 'young ones' most landlords seem to recall from their days at Uni. Students now want a nice place to live, to go with their designer clothes and iPhone 20.
SJK said:
The new PBSA developments being built are not exactly halls. Halls are pokey 1 single bed and a chair width desk, if they are lucky a en suite bathroom. Have a look at the private owned student accommodation being offered to investors. Self contained studios, own bathroom, kitchenette, double bed and a bit of space.
Students in 2nd and third years are choosing to spend 160pw for their own space, no sharing facilities and then being able to use on site gyms foc, socialise with 100 other students in the games room etc.
£120pw for a bedroom in usually a old house with a bit of damp, taking shifts on the bathroom and having to deal with messy housemates doesnt seem worth the few quid a day. Then you have the fact the PBSA will be closer.
Students are far from the penny pinching 'young ones' most landlords seem to recall from their days at Uni. Students now want a nice place to live, to go with their designer clothes and iPhone 20.
They are really nice, but the new stuff in Bath looks to be around £200+ a week, from what I can see from a quick Google. Most people are happy to take that hit in the first year for halls on the basis that it is a 10 month contract and usually includes bills. Those types of halls are perfect for first years who haven't made friends and are getting settled, but after that, I think they'd have limited appeal. Overseas students who are travelling on their own probably like them as well, and they are usually the ones who don't care about costs.Students in 2nd and third years are choosing to spend 160pw for their own space, no sharing facilities and then being able to use on site gyms foc, socialise with 100 other students in the games room etc.
£120pw for a bedroom in usually a old house with a bit of damp, taking shifts on the bathroom and having to deal with messy housemates doesnt seem worth the few quid a day. Then you have the fact the PBSA will be closer.
Students are far from the penny pinching 'young ones' most landlords seem to recall from their days at Uni. Students now want a nice place to live, to go with their designer clothes and iPhone 20.
The students that I've spoken to hated halls. Noise all the time, communal areas getting trashed, people getting drunk and damaging stuff etc. I don't think the new stuff will be much different, except they don't have to share a living room or kitchen with others. Imagine doing a proper degree and needing to actually revise and do work and having someone next door from the s
t uni who never does work and pisses you off with noise etc, as I bet the soundproofing isn't up to much in these buildings. Most private houses are 12 month contracts, and probably averages around £100pw + Bills, so probably only slightly cheaper. You get your own house and can choose who you live with. Damp generally isn't a problem. Black mould, yes, but that's not damp. That's condensation. Most of the houses are within an area close to shops, gym, entertainment etc, infact, Bath is so small, you're never far from anything!
There are plenty of nice private houses about, but you'll have to pay for it. Same with anything.
Those new halls will be nice for a few years, then they'll be f
ked and need refurbing. I expect they are absolutely nazis with the deposits as well.All students and ex students i have spoken to have been unanimous in preferring to rent a house with mates. Halls in the first year whilst they find their feet and strike up friendships, then a student house. The "student pods" are just not popular and as an investor of no interest ultimately because you never actually own them, you only derive an income from them for a set period of time. The hard sell tactics of the people trying to sell them is also very tiresome and persistent.
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