7 Tips On Buying Profitable Florida Property

Tip 1: Make Sure You Invest In Areas With Strong Rental Demand

The most important thing to remember when investing in property is to buy in an area that is in demand. There is really no difference between the sunshine state of Florida, or a row of terraces in Bradford in the UK when it comes to choosing the right area.

By right area, we mean one where there is likely to be a good supply of prospective tenants willing to pay the level of rent that will not only cover the cost of your investment, but also generate a decent profit each month. Any rise in the value of the property then becomes a nice little bonus to enjoy.

 

Tip 2: Look For Properties That Have Tenants Already In Place

This may sound obvious, however it cannot be stressed enough that “tenanted” should mean just that. The promise of tenants is really not enough in the Florida market as there should be enough demand in the area you are investing in to have them already in place or waiting to move in.

Florida tenanted properties are the easiest way to generate positive cash flow from day one and cover the costs of ownership. As any serious property investor will tell you, having tenants in your property long term is the best way to make money rather than having your tenant rent short term and the associated hassles that go with it.

 

Tip 3: Is It Close To Major Business Districts?

Back in the old days before the credit crunch, many property investors were fooled into thinking that no matter where you invest in a growing market, as long as your property was within a 30 mile radius of the city centre then you could expect high rental demand and benefit from any ripple effect. This is not the case anymore; with the rising cost of fuel, people prefer living closer to their place of work so that they can avoid travelling on congested roads. They also prefer having access to good local amenities.

Properties are heavily discounted enough to buy without resorting to investing in areas that have low levels of rental demand because they may appear to be a bargain.

 

Tip 4: Research The Local Environment

As you might have heard on the news there are good and there are not so good areas of Florida. Your typical young professional or growing family will not want to live in an area with high levels of crime or where gangs roam the streets at night.

Investing in an up and coming area is one thing, but if an area has gained itself a not so good reputation over the years, this will be impossible to shake off. To avoid these risks, opt for new developments in areas that offer a combination of green space and on good routes into the city centre.

 

Tip 5: If You Want To Invest In A Short Term Holiday Rental, Prepare Yourself For Seasonal Lulls

For those investing in holiday homes in Florida, the potential rental income can bring in between $700 and $1000 a week plus in areas of Orlando.

Again a property will need to be chosen carefully and after the costs of ownership are taken into account, the slow steady route of Florida tenanted property will generate a better return on investment in the long term. Think of it as comparing the tortoise with the hare.

 

Tip 6: Is Your Property Fully Managed?

If you are investing from a distance it is a good idea to have your property managed by a team of competent professionals. This just makes things a lot easier when it comes to the day to day running of the property including maintenance issues, collecting the rent and utility bills.

With the right property management in place, you can, for a fee typically between 8-10% of the rental income, just rent it and forget it.

 

Tip 7: Seek Advice From An Expert

Property prices may be low in Florida, however investing in property can be an expensive business which is why it is useful to have someone looking out for your interests and helping with due diligence in any deals you make.

In most cases, a property consultancy will be happy to help you through the process and any negotiations. This will save you a lot of time and hassle unless you really know what you are doing in this market. It is also recommended that a Florida property lawyer is appointed to review any purchasing agreements and title deeds.

 

>> Have a look at our Florida Properties now! <<

 

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5 Main Reasons Why Student Accommodation Makes A Perfect Investment

I once lived in a five-bedroom house with four other students in what was known as Cardiff’s student village. The house was furnished with second hand furniture, the kind that most people would throw into the nearest rubbish bin and forget about. My friends and I did not care. As for me, I was riding the crest of a wave at just being given that opportunity to study at one of the UK’s leading universities.

I thought nothing about paying the old landlord £300 a month for my room. Most students don’t. Then soon it began to dawn on me – a house that holds many books is also a good store of wealth. Many things have changed in the decade or so since then, apart from one property investment that has always stood the test of time.

 

5 Reasons Why Student Property Makes A Perfect Investment:

  • Student Property In The UK Is In High Demand
  • Rental Yields Are 8% Plus
  • 68% Of The UK’s Top University Cities Have Seen Student Rents Increase
  • Student Property Offers A Low Cost Entry Into UK Property Investment
  • It Is Easy To Invest In UK Student Property From Anywhere In The World

>> Browse Our Student Properties Now <<

 

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Holiday Home Or Investment Property – What’s Right For You?

For investors looking for positive cash flow, the rental market, particularly in South Florida is seeing strong growth. Rents increased 2.9% year on year to 2012 in Florida as a whole, 5.6% in Miami Fort Lauderdale Metro and 3.8% in Orlando Metro area. On the other hand, if you plan to use the property as a holiday home and regular cash flow is not an issue, then a holiday home will be the perfect choice for you.

Each type has its advantages and disadvantages, especially in the US where land is divided into long-term ‘residential’ zones and short-term ‘holiday’ zones. Before you invest your money, make sure that you’ve found the right property type!

 

Holiday Home

A holiday home investor will crave the excitement Florida has to offer, the beaches, Disneyland and the fantastic climate. The chances are you will make a good return on your investment by renting the property and this is why historically, people are so attracted by the idea of a property in America’s Sunshine State.

Thanks to the great USA real estate downturn, property is now so cheap you can pick up villas in Florida with a pool for less than half the price of a two bedroom apartment in Bolton, UK. However, before we dive into the pool let’s take a closer look at some of the pros and cons, which one unfortunate investor failed to do fully before taking the plunge.

As the story of one UK investor tells us… “I bought a villa in Florida three years ago. I chose a location I knew attracted a fair amount of tourism. I figured that I could enjoy the twin benefits of a rental income in peak season and a place to spend my vacations and get away from the cold grey winter days back in the UK.”

So far so good, however he didn’t consider all the associated costs that he failed to cover due to longer void periods than he would otherwise have had with a Florida tenanted property. If we look beyond the obvious attractions and take off the rose tinted specs, we find there are costs associated with running this particular holiday home that this investor didn’t foresee at the time. Consider the following:

  1. Council Tax
  2. Community Fees
  3. Property Booking Fees
  4. Property Management Fees
  5. Property Cleaning
  6. Building Insurance
  7. Contents Insurance
  8. Furniture
  9. Pool Cleaning
  10. Electric Bills
  11. Water Bills
  12. Telephone Bills
  13. Internet Bills
  14. Lawn Cutting
  15. Annual Hotel Licence

As you can see owning a holiday home in Florida can be an expensive business and you will need deep pockets, even if the property appears to be a bargain. That said, depending on the area and the season, you might also see the benefit of $700 to $1,200 a week for a four-bedroom detached property in Florida.

You will need to rent the property for more than 30 weeks a year in Florida to make a potential return. Outside of peak season it will be more challenging to find regular tenants without you or your management company putting in some hard work on advertising your property and even more work dealing with the needs of multiple tenants during the main holiday season.

However, if you are looking for a lifestyle investment, then a holiday home is the right choice for you, but you must be prepared to accept the higher running cost that comes with such an investment.

 

Investment Property

The most profitable way to make money from Florida property is to choose properties that already have the tenants in place. Like any good investment this will require a degree of sacrifice, you won’t be able to spend your holidays in it, but it will turn the notion of a “holiday home” on its head.

A tenanted property in Florida will fund your holiday and more importantly pay for itself with steady cash flow. Your tenanted property is then your “holiday property” for a few reasons:

  • It will reduce your associated property costs by more than half.
  • It will produce a constant and steady flow of income.
  • You can use the savings and profit to spend on holidays.

A famous economist named Paul Samuelson once said, “Investing should be more like watching paint dry or watching grass grow, if you want excitement take $800 and go to Las Vegas.” 

Before you fly west, the exciting thing about Florida tenanted property is that there are now opportunities to earn a profit of up to $8,000 per annum based on net yields of between 7-10%. This is after you have paid out the following:

  1. Council Tax
  2. Community Fees
  3. Property Management Fees
  4. Building Insurance
  5. Contents Insurance

Now doesn’t that sound more exciting than watching paint dry? Also imagine those extra holidays you could have with that sort of rental profit. So, instead of taking a bet on a holiday rental, I would recommend a more relaxed route to property wealth generation, where the tenant pays your mortgage and costs – allowing you time off to enjoy your holidays.

If you have any questions or comments, please put them in the comments section below and we will get back to you! In the meantime, have a look at the properties we have for sale in Florida.

 

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10 Good Reasons To Invest In Florida’s Cash Flow Positive Properties

Reason 1: Grab Yourself A Bargain!

We all like a bargain and as property investors we like them even more so. However, there are signs that those huge $150,000 discounts are coming to an end as the market recovers and growth returns. Property remains undervalued, so taking advantage of this window of opportunity should be high on any investor’s agenda.

 

Reason 2: Strong And Growing Tourist Market

Tourism is worth an annual estimated $57 billion to the Florida economy and a 4.1% increase in hotel bookings in 2012 has been greeted as a sign that Florida is well on the road to recovery. The extra jobs this brings to the state will provide an extra boost to the rental market in areas close to tourist hotspots like Orlando.

 

Reason 3: No State Tax

There is no state tax in Florida which has positioned the state as a shelter state for wealth for both individuals and corporations and of course you, the property investor.

 

Reason 4: Unique Combination Of Knowledge And Infrastructure

No other location in the western hemisphere can match Florida’s unique combination of a strategic geographic position, strong knowledge base, state-of-the-art infrastructure, entrepreneurial spirit, and concentration of corporate and financial resources.

 

Reason 5: Industry Growth

The area’s industry growth is focused on the professional medical and business service sector; all these are likely to see significant growth and investment both now and in the near future.

 

Reason 6: Strong Rental Demand For Quality Real Estate

Rental returns on tenanted properties in carefully selected areas can yield approximately $10,000 per annum.

 

Reason 7: Foreign Direct Investment

The state has emerged as a hotspot for foreign direct investment (FDI), where total holdings by non-US companies are valued at $40 billion. Investment brings employment and demand for housing.

 

Reason 8: Fastest Growing U.S. State

Over 350,000 people move to Florida every year, making it the fastest growing US State. The Gulf Coast is particularly popular with second home buyers and investors.

 

Reason 9: Strong Demand

Baby Boomers are retiring in record numbers and flocking to the Sunshine State to invest in second homes. These are joined by investors notably from Canada and other international investors looking for their own piece of the Florida sunshine. This trend is likely to continue for the foreseeable future.

 

Reason 10: Price Growth

Prices are rising in the large metropolitan areas, most notably in Orlando, Tampa and Miami, which have all seen astonishing growth, even before the recovery was underway.

 

Are you ready to invest in Florida? Have a look at our properties here.

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Why Is Student Investment Better Than A Typical Buy-To-Let?

Student property in the UK is all about high rental yields. Investors can invest remotely and have the whole process and hassle removed by the management company who will take care of collecting the rent and any maintenance. There is absolutely zero hassle, and rental returns are higher than from any other buy-to-let investment.

Getting a college degree is a minimum requirement to get a good job – it opens more doors. UK universities will continue attracting home and international students. UCAS, the company which deals with applications to Britain’s universities, reported that an additional 19,000 students applied to go to university in 2013 compared to 2012 and the trend is said to continue.

Student property has always been a way for buy-to-let investors to benefit from houses of multiple occupation (HMOs). Student houses offer higher yields, simply because each individual person who lives in the property has to pay rent. This is quite unlike the typical buy-to-let investment where one family pays the rent for the whole apartment or building.

A major benefit of investing in student accommodation over other property types is almost no void period. Because of the huge demand and low supply levels, you can count on 99% occupancy rates and students with year-long tenancies.

According to one survey, leasing property to students on a per room basis, landlords were able to achieve yields of 6.45% on average in the UK, compared to 5.94% from properties rented out to families. Have a look at the selection of our Student Properties.

Have you got any questions? We’d love to hear from you! Please leave your comments below and we will get back to you.

 

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How To Use Cement To Predict Property Growth

Today, I will explain how you can predict housing markets, just by watching how much cement is being bought. 

My analysis will focus on one of the fastest growing property markets in the world today, Istanbul. We have seen growth of 17% in 2013 and Istanbul ranks 1st in the latest Price Waterhouse Cooper survey, “Emerging Trends in Real Estate Europe 2013.”

There are many reasons for the strong house price growth in Istanbul, spanning from the demographic dynamics of a young and growing population, the growth of income and tourism, the growing foreign investment, through to the domestic real estate market. 

When assessing a property market there are many factors that you can use – most of them you probably know already. However, reviewing data that shows how “the cement” is flowing, is another method that can give you great insight. 

turkey-cement-prices.png

As we look at the chart above, it is logical to conclude that the growth of house prices is accompanied by a strong increase of Cement Domestic Sales, indicating a rising demand in the real estate sector. 

If I reviewed the Cement Domestic Sales in say two years’ time and saw a drastic downward curve, I would keep a closer eye on the market place and probably limit my investment into the region. A slowdown in Cement Domestic Sales, could mean demand is falling – which is never a good ingredient for property growth. 

The vibrancy and forward motion is with Istanbul for sure. The government is undertaking a series of major infrastructure projects, such as; the construction of the third Bosphorus Bridge, the building of an artificial canal connecting the Sea of Marmara to the Black Sea and a new airport is also planned for Istanbul. 

In summary; the Cement Domestic Sales are booming, international investors are pouring in from 183 countries and double digit growth has been achieved every year since 2009… No wonder Istanbul is ranked the number one in emerging market investments today. 

Top Istanbul Opportunity To Add To Your Portfolio 

Inci Palas

Inci Palas

  • Prices from £44,000 / $69,150
  • 12% Rental Guarantee Over Two Years
  • Key-Ready
  • One, Two and Three-Bed Apartments
  • 50% Projected Growth
  • No Finder’s Fee Guarantee

>> See More Details About Inci Palas <<

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Why Do Investors Flock To Florida?

Florida is the home of the Kennedy Space Center, Disneyland and more importantly for us, properties available at heavily discounted prices with the potential to generate high returns on investment. This might be the home of Disney, however this is no fantasy world – there is an exceptional opportunity to invest while property prices are at the bottom of the cycle. Investors should already be taking advantage in an area with outstanding growth and economic prospects.

Apartments, townhouses and villas in select communities and desirable areas are available with prices starting from less than $100,000 and these properties certainly offer high cash flow rental returns and some are offered with tenants already in place. The key to being successful in this market is selecting heavily discounted property in areas with high tenant demand. It really is that simple.

As the US economy slid into recession and property prices fell dramatically, developers and homeowners in Florida faced incredibly tough market conditions. The consequences of which are still being felt today – the good news for investors is that there are now clear signs of a sustainable recovery.

The rental market is also healthy as you might expect, with demand for property high in this recovering market. Many families are also seeking rental property as tight mortgage lending conditions continue. Developers now feel brave enough to begin developing land they have been holding too for the past few years, which is another green light for investors.

We have carried out extensive research into Florida, narrowing down the focus to specific hotspot locations and places of interest that have rock bottom prices. These are already showing signs of an upward trend that will continue to rise throughout 2014 because:

Florida is on course to break the 20 million population mark during 2016. This will make it the third most populated state, surpassing even New York.

Low property prices will continue to attract cash buyers and particularly foreign investors.

The first wave of the baby boom generation will be hitting retirement and many will want to spend that retirement living in Florida as we are already seeing. The U.S. national recovery is already underway.

>>See what you can get in Florida!<<

 

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UK Student Property Investment Guide

Why invest in student properties?

The answer is simple – the returns are guaranteed.

There is huge demand for purpose-built student accommodation in the UK because there is a national shortage. The number of local and international students is also increasing rapidly. Most people need a degree to have a chance of getting a job in the 21st century.

Student property in the UK is all about high rental yields. You can count on 100% occupancy rates and 1-year or longer tenancies – this means no void periods and stable profit from day one. Investors can invest remotely and enjoy the returns brought by a fast growing student population in the best University towns and cities.

>>Download The UK Student Guide Now!<<

 

We have prepared a selection of student properties you may be interested in – click on the link below and let us know if you have any questions.

>>Browse Our Student Investment Properties<<

 

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Florida Investment: Economic Snapshot

The Overview

After a long period where there seemed to be no end to falling property prices, there is a positive mood emerging in Florida thanks to stabilisation. It had to come – property prices have fallen dramatically from the peak of the US housing boom.

Investors can be confident that the Florida property market is on a sustainable path to recovery due to a rare combination of low prices, an improving economic picture, low interest rates and media obsession with highlighting how Florida property is such excellent value for money.

We anticipate that the Florida economy will follow a pattern of recovery similar to that of the U.S. as a whole. The state broadly follows the same trend lines with the slow recovery in recent years just beginning to pick up speed after a stuttering start between 2010 and 2012.

 

What’s The Rush??

Prices are at rock bottom which is encouraging domestic and international cash investors to snap up property before prices begin to increase. More upward pressure on prices will come as a consequence of growth in the state population.

With a whole generation of so-called ‘Baby Boomers’ reaching retirement and looking for second homes in areas around the coast, competition for property will force prices higher in the longer term as the market recovers. The baby boom generation now represents 39.7% of Florida’s total population according to Florida Office of Demographic Research.

 

The Green Light

Economic indicators are an important consideration for any property investor and in Florida we have established that recovery is underway; albeit at a slower pace than was the case following previous recessions. There are plenty of green shoots appearing in Florida, but it will take more than sunshine to get it growing to the levels that brought the last housing boom.

To a large extent Florida’s economic recovery will depend on what happens at a national level. The good news for those investing in real estate is that the worst appears to be over and all the indications are that Florida is entering a new growth cycle. This is the time to maximise profit from your investment. Although there are new properties being built, the developers can’t keep up with the increasing demand for accommodation.

For investors looking for positive cash flow, the rental market, particularly in South Florida is seeing strong growth. Rents increased 2.9% year on year to 2012 in Florida as a whole, 5.6% in Miami Fort Lauderdale Metro and 3.8% in Orlando Metro area.

The outlook for rents in Florida overall is positive and if we look more closely at Orlando and Miami in recent months all the evidence points toward significant increases in the medium term. The continuing restrictions on lending will only add to the absorption of good quality rental properties for the foreseeable future restricting supply and increasing rents.

 

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Facts and Figures About Florida, The Sunshine State

It’s no wonder that Florida’s combination of temperate climate, outstanding recreational amenities, economic opportunities and no state income tax has consistently made the Sunshine State one of the most desired places to invest. It has beautiful beaches, fabulous weather and a friendly business climate with no state income tax. These are the things that brought people to Florida in the first place, and will continue to attract them.

Have a look below at some of the key figures about the state of Florida, and if you would like to know more, please ask your questions in the comments below.

Nickname: The Sunshine State

Population: 18,000,000

Capital: Tallahassee

Languages: English/Spanish

Time Zone: GMT -6

Climate: Tropical

Commercial Airports: 19

Land Area: 139,697 sq. km

Currency: United States Dollar (USD)

GDP: $38,000 (per capita)

Foreign Direct Investment: US $33.6 billion

Exports: US $45 billion

Imports: US $55 billion

Interest Rate: 25%

Inflation: 27%

Unemployment: 9.4%

 

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How You Can Make More Money Without Turning Up For Work

I spent several years of my life working for someone else.

For a decade I worked in engineering. I gave that up to do a full time degree. Then I worked as writer. 

All the jobs I had led to one place – a dead end.

The dead end is the point where you have reached your ceiling.

Until you reach this point, a job really isn’t such a bad thing.

You get paid and someone else worries about the business side of things. All you need to do is turn up, do your job well, get paid and go to sleep when you get home.

Then you hit the ceiling and suddenly work becomes a chore. It isn’t exciting anymore and you’re not making any more money than you did a year ago. Instead of feeling like you are making progress in life you feel like you are being held back.

While inflation eats into your take home pay the demands of your job keep getting bigger.

Then you start looking at the more tempting things on offer elsewhere. The kind of things that will rescue you from this treadmill you find yourself on.

One of those things might be property. Or buy-to-let property.

With property you can make money without having to turn up for work in the morning. Eventually you won’t need to deal with the boss or staff appraisals that tell you that you must improve.

With buy-to-let property your tenant pays you and you are in charge.  You can also spend time doing the things you enjoy rather than the things you don’t.

But here’s the thing, the job is what gets you the property in the end. If you begin to look at your job as the way to achieve your investment dreams then it becomes easier to do that job.

Property investment is your long term life project. Your job is the vehicle that gets you there. Don’t give it up too soon and don’t give up on your dreams of escape.

Are you ready to escape soon?

Kind regards

Brett Tudor
Property Expert

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Are You One Of The 76% Of People Who Have Broken Promises This Year?

By the time I finish this blog, 76% of people who made a promise to themselves for the New Year will break it.

If you happen to be one of the 76% but you want to join the 24% of people who kept their promise to change their lives, then you will need to understand one thing. It’s all about making progress.

And progress can be made in so many ways.

You can commit to losing a few pounds. You can  organise your life better, get fit or and take care of that desk full of paperwork.

Progress doesn’t even need to be about you. You can help others make progress.

Making progress is easier than you think if you know where you want to get to.

If your goal is to make money from property you need to make progress first. Find the investment that suits you best and make your way towards it. 

One of the things I learned when I climbed a mountain was to concentrate on the steps. Don’t think about how hard it is climbing on those rocks, the achy knees, the sweat and how far away the summit is.

Focus only on taking one step at a time. Then you make progress and it doesn’t feel painful.  

By taking one step at a time you can become more powerful and wealthy than you ever imagined at the beginning.

Are you making progress with your investment goals this year?

Kind Regards

Brett Tudor
Property Expert

 

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What Will The 24-hour Tube Mean For London Property Prices?

The Tube is London’s underground. It also has a big say in what happens overground.  

The Tube has been part of this great city for 150 years.

In that time we have had two world wars. We have seen national events that live long in our memories.

We have seen David Beckham racing along the Thames in a speed boat. Deep underground the tube made everything possible – it made London what it is today.

The Tube helps people get around the city. It helps them to do their jobs or go out for a drink at the weekend. Take the Tube away and you have more traffic, even more crowded buses – you just get stuck. The artery gets clogged.  

People are excited by the idea that they can go out at the weekend and have a faster way to get home or go out at night. The young office worker who wants to party at the weekend will soon feel better connected to where he lives.

Instead of taking the bus, the 24-hour tube will make it so much easier for him and his friends to get back to their homes in the city.  

Talk to the people who look after statistics and they will tell you property that is within a five-minute walk of a Tube station can add up to 20 per cent to its value and its rental price.

Talk to the property investors and they are thinking that a 24-hour tube can only push prices up further. People who live by them will be getting a whole new service.

Ask anyone on the New York Subway and they will say, “What’s the big deal?”

In New York, they have an underground train 24 hours a day, 365 days a year. For London though, it is a big deal.

No more crowded buses, no more expensive taxis needed to get to and from wherever they might be travelling after midnight.

But not everyone is excited by the 24-hour Tube. Talk to the people who work on the underground and they will tell you about losing their jobs as the Tube becomes more automated.

These are the sides of the story that you will be hearing a lot about before the Night Tube is launched in 2015.

London’s underground is the oldest in the world. It hasn’t changed much in 150 years but as Winston Churchill the famous leader who kept London going in the Blitz once said, “To improve is to change; to be perfect is to change often.”

Unlike the tube – change and progress won’t come for those who wait.  

What are your thoughts about the 24-hour Tube? I would be interested to hear them.

Kind regards

Brett Tudor
Property Expert

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How To Banish Inflation From Your Wallet

There are really only two kinds of inflation you should be worried about:

  • The inflation that starts costing you more money
  • The inflation you can’t see

You notice the first one when you go and do your weekly shopping and leave the supermarket scratching your head and thinking ‘what did I put in the trolley that made it cost this much?’

The inflation you can’t see is different.

It comes in cycles. This kind of inflation sneaks up on you when your attention is on other things.

There is no need to worry about the inflation you see – it is already here and there is nothing you can do about.

The second kind? Well the sooner you start thinking about it the better. It is going to cost you a lot of money if you ignore it.

Just because it said on the news last night that inflation was falling, don’t let that fool you. Inflation is still there. Inflation is always there. It doesn’t go away unless you happen to live in Japan, but that’s another blog.

So how does this inflation affect you?

It starts with interest. Interest for most people comes in two different forms: High interest and not-enough interest.

For example if you are earning 1% on the money you have sitting there in your current account and inflation is running at 2% then you will be losing 1% of that money every year.

The more you put in, the more money you will be losing even though you are in credit.

So if you have £1,000 in your account and leave it there for 12 months the bank will give you £10 worth of interest and inflation will take away £20  leaving you £10 worse off. You probably won’t even notice inflation doing this.

There is absolutely nothing you can do with money sitting in a bank account. Unless you have it in a high interest account, Inflation will keep taking your money and that’s just the way it is.

To beat inflation you need to do something radical. This is something most people don’t like to do because they worry about losing money, paying bills and surviving.

What you need to do is invest your money. Yes you take a risk, but it is the only way to beat inflation. 

The easiest and safest way to invest money is in property and other real assets. Property is something you can see, touch and live in.  

Inflation can’t touch property because property doesn’t sit in your wallet.

Do you know what’s even better?

Inflation actually works with you when you invest in property.  If you own a property you can put the rent up. Then the price when it is time to sell.

The value of property doesn’t stand still – only the paper money you use to pay for it. Yes property prices can fall as we have seen but in the long term they always rise.

There is just one thing to think about – high interest.

High interest is something the banks won’t give you unless you allow them to take your money and tie it up for a long time.

You won’t have access to it and you won’t be able to put it straight back in your wallet. High interest can also hurt you.

The banks are much more generous with the interest they add on to the money you borrow. Back in the late 1980s lots of people could afford to buy property, until high bank interest rates came along.

People could no longer pay their mortgages when interest rates soared to 16% and they were forced to hand back the keys. The high interest rates were needed to keep down inflation.  

The great thing is, it is easy to protect yourself from high interest and inflation.

You just need to invest in the right property at the right price. Then find the tenants who will cover your costs.

So go and beat inflation – your wallet is depending on you. 

Have you ever been caught out by inflation? Please leave your comments below.

Kind regards

Brett Tudor
Property Expert

 

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Is It Worth Setting Up An LLC To Invest In USA Property?

I am often asked questions about the possible tax advantages of investing in overseas property.

This latest one came from Peter who tells me that he has been interested in investing in the USA for some time but he is nervous about tax. He likes the idea of setting up an LLC with a friend however he is unsure what advantage this will provide.  

If you don’t happen to know what an LLC is, it is a Limited Liability Company.

An LLC is sometimes used to invest in property in the USA because people think it will give them tax advantages.

The bad news is – it won’t.

The good news is there are other advantages of setting up an LLC.

First though, it is worth noting that the USA’s Inland Revenue Service (IRS) will treat your one-member LLC as sole a proprietorship when it comes to tax. If your LLC includes more than one member it will be treated as a partnership.

So the LLC will not pay the tax, that responsibility will fall on you the owner and your partners if you have them.

So you will still need to file an annual tax return.

If you decide to sell your property then you will also need to pay capital gains tax and withholding tax.

Accountancy fees for this will be approximately $550. It can also cost up to $900 to set up the LLC. (Don’t worry if you need more advice on this our USA tax experts can help).

So what does Peter have to gain from setting up an LLC for his USA Property?

Whenever you set up a limited company you reduce your personal liability.

The same applies when you invest in USA property. This can be an advantage.

If anything goes wrong with your investment, for example if someone decides to sue you for something, (remember there is a strong claims culture in the USA) the company is liable rather than you personally. 

You can also sell your LLC rather than the property which can reduce the capital gains you pay on the sale. 

(If you are still unsure about your position regarding tax I can put you in touch with our accountant who can sort out any issues regarding your personal circumstances).

What are your experiences of tax on USA property? Please leave any comments you have below.

Kind regards

Loxley McKenzie
Managing Director

 

Disclaimer: Please note that the information in this article is of a general nature and should not be taken as a substitute for advice from a qualified tax advisor. If you need professional advice on property tax matters one of our advisors will be happy to guide you.

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3 Mind Blowing Things I Learnt About Investment From A Boxer And A Book

Funny isn’t it how life can point you in a direction you would never have thought of going.

I like boxing and one day I decided to look up this boxer and how he became a heavyweight champion by beating Muhammad Ali in 1973.

This was a fight nobody expected this boxer with a unique, unorthodox style to win. Four years earlier he had lost to an unknown fighter from Puerto Rico, even  getting himself knocked out in the process.    

The boxer was Ken Norton and he would go on to fight Ali twice more after that shock win giving him further scares both times. He became one of the most feared heavyweight boxers giving most of his opponents a hard time in the ring with his hard to beat style.  

His inspiration for that first big win according to his autobiography was a book about personal development written in the 1930s. The book is called Think And Grow Rich.

I had never read this book or heard of it until I found out about it through the story of this boxer, yet this was a book that inspired him to greatness. Here’s what I learned when I read it myself:

  1. We are free to do whatever we want in life. We are free to marry who we choose .We are free to set up a business doing whatever we want or we are free to get a job. We are free to learn what we choose to learn and choose the books that will teach us those things.

    WE ARE ALSO FREE TO INVEST IN AS MUCH PROPERTY AND  WEALTH AS WE WANT TO ACCUMULATE. People in the past did not have these freedoms. People in many countries in the 1930s did not have these freedoms. Use that freedom.

  2. Do you know what is top of the list of the main causes of failure? FAILING TO MAKE A DECISION. Failing to act when the time is right. The world’s richest people will all have one thing in common – the ability to make quick decisions and stick by them.

    They don’t take their time and they don’t change their minds often. Changing your mind all the time is one of the biggest threats to achieving something in your life – be decisive. 

  3. AND FINALLY, a quality all the world’s most successful people have is persistence. Without persistence you will not stick to your goal.

    At the first sign of failure most people give up. You see this everyday in sport. The head goes down and faith disappears. Faced with having to fight the most feared and successful boxer of his generation, Norton didn’t give up, just like all the successful investors who keep their head up and believe they will grow rich no matter what. They usually do.

Have you ever been inspired to achieve something by a book you have read? Please share your successes with us below:

Kind regards

Brett Tudor
Property Expert

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Is Owning A Rental Property Worth It?

One of the best decisions I ever made was to invest in a rental property.

When I started out, I bought a property that was nothing to write home about and I ended up sleeping on the floor. I worked very hard to make the house look presentable enough for tenants to want to move in.

A lot of people will make you question the wisdom of property investment. There are times when might question it yourself in the early years.

I learned an important lesson from that first rental property. Everything comes down to cash flow.

All the wealth you get from owning property comes from cash flow.  Without cash flow, property is an asset that doesn’t pay you back anything until you sell it.

So owning a good rental property is worth it if you want to put some real cash back in your pocket.

The return you get from property investment comes from the rent your tenants pay you every month, less the amount it costs to run the property.

So if a property has a rental return of 5% you need to figure out how much of that you get to keep for yourself for the investment to be worth it. 

Sometimes that 5% may not all the profit you make from the property – unless it is calculated as a net return.  

The net rental return is what you get when all the things like management charges and taxes are taken out. You will need as much of that monthly return as you can keep hold of to make your investment worthwhile.

The gain you get from appreciation comes much later. This is why property investment should be a long term strategy. Historically property prices have always gone up.

So property is worth the effort if your plan includes getting a good monthly rental return.

The real magic begins when you invest in more than one property:

Let’s say John invests in a 5 unit apartment complex.

The apartments cost £125,000 per unit and he gets a conservative 3% appreciation growth per year for 5 years. 

This gives him a return of £79,000 on paper.

Rent those same 5 apartments out and the rental income is £125,000 over 5 years.

If John stopped at just one property he would miss out on all this extra income.

Real estate investing can be a headache if you don’t plan long term and you can’t find someone who is willing to help do at least some of work for you.

It is not only about investment, you will need to spend some time taking care of the investment property.

You can hire people to do the work for you, but like any investment, the more people you hire the less money you will make.

So always allow for your expenses. It will have an impact on the amount of money you can make as a property investor and save you some headaches in the future.

Is owning a rental property worth it for you?

Kind Regards

Brett Tudor
Property Expert

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8 Ways To Achieve Your Property Investment Goals

Did you ever dream of owning a rental property? Or a whole portfolio?

Investment is no longer for the special few or rich people. It is open to anyone at any age or from any walk of life. 

The trouble is most clever people like you don’t really believe they can build a million pound property portfolio

How do I know? Well I had a long list of excuses myself before I started out as a youngster. They went something like this:

  • I don’t have any money
  • I have no idea how to invest in anything
  • I don’t have any experience.
  • It looks so scary. Oh dear, what if anything goes wrong and I lose all my money?
  • It’s too early for me, nobody becomes a property investor at my age

I had plenty more. What you realise is that all these excuses are the obstacles your brain puts in the way. They’re the lies you tell yourself whenever you decide to do something that makes you feel a little uncomfortable.

These obstacles are bad for you and make you want to give up. Bad for you, bad for your future and bad for your motivation.

I can tell you the reason I chose to be a property investor was because I didn’t want to spend my days helping my boss get richer. I didn’t want to work in a record store even if I had access to all the rare records I wanted.

My advice to you is don’t let the obstacles in your mind hold you back. Start investing now and follow these 8 ways to achieve you property dreams. 

1. Think big. Follow your investment ambitions, you never know where they might lead.

2. Don’t waste time. The time to start investing for the future is now, not tomorrow, next week or in a year’s time.

3. Don’t be afraid of failing. If you fear failure you end up wasting time, (see list of the objections above).  

4. Get help. All successful investors had a little help at some point. Don’t be afraid to ask for it.

5. Practice self-belief. Tell yourself you are going to be a successful investor every day. Then you will believe it. 

6. Ignore the doubters.  Particularly when you start out.  The chances are the people who doubt you haven’t achieved any investment goals. Prove them wrong. 

7. Be patient. Property investment isn’t a sprint, it’s a marathon. Plan for the long term.

8. Don’t be afraid to share your experiences with others. Giving advice and helping others should be a habit right from the start. You never know when you might need that help and support yourself.

There has never been a better time to invest in property than now. Are you chasing your dream yet?

 Kind regards

Loxley McKenzie
Managing Director

 

 

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Florida Guide – Everything You Need To Know About Investing In Florida

Florida Property Investment Guide

Have you ever wondered why Florida is such a popular destination among investors? What makes the Sunshine State so attractive? Maybe you’re after detailed information about running costs, management fees and what locations offer the best returns? Perhaps you would like to learn about the things that can go wrong and how to avoid them?

Download our free, 54-page guide and maximise the chances of making a safe and profitable investment. No need to sign up or fill up forms, simply click the download link below and enjoy. You will learn every aspect of investment in Florida, including:

1. What Makes Florida So Special
2. Florida Economic Snapshot
3. Property Investment In Florida
4. Florida Facts And Figures
5. The Investment Opportunity
6. Florida Hotspots – Investing For Cash Flow
7. Property Market Cycles
8. Property Types
9. Property Ownership
10. Choosing Your Property
11. Renting And Management
12. Exit Strategy
13. Our Expertise
14. Summary
15. Florida FAQs

If you have any questions, please place them in the comments below and we will get back to you with the answers!

>>Download The Florida Investment Guide<<

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Mickey Mouse Saw This Happen 85 Years Ago And Nothing Has Changed

85 and not even one grey hair. If Mickey was a property investor he would probably have the world’s biggest portfolio because he would know the worst kept secret in the business.

You see Mickey was born in a house-building boom. This boom saw rising house prices, home ownership rates that soared and banks thinking of all kinds of ingenious ways to make finance available to those who either wanted it – or needed it.  

Soon dark clouds were gathering; property prices were hitting a peak – then came a crash when property prices fell by a third.
The suburbs of cities were overbuilt and houses stood a long time untenanted.

Even the apartment buildings that helped investors make quick capital gains stood empty as low occupancy rates took their toll.

Mickey was busy doing Steamboat Willie when all this was happening. 80 years later he saw the exact same things happening again.

But if Mickey was a property investor he would tell you one important thing. Be patient. As the saying goes; patience is bitter but the fruit is sweet.

He would repeat the old saying and ask you, “Have you ever noticed how overnight success takes about 10 years?”

People lose on property when they look for overnight success and they don’t look at the long term. You need to be older and wiser to see that.

The good thing about property is that unlike Mickey Mouse you will not need to have lived through the two world wars or have seen the first man land on the moon to understand one basic truth about investment.

We have just seen the end of one cycle – the next one is just beginning. Property markets move in cycles, they always have and they always will. Just like Mickey, property investing never goes out of fashion.

Do you agree or disagree? Please leave your comments below:

Kind Regards

Loxley McKenzie
Managing Director

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