Property Investment UK - Capital Growth or Yield - What is YOUR Strategy?

With your financial appraisal complete and your mortgage offer issued, you will then be equipped to make a decision on your investment property. It's vital that we understand what you are looking to achieve first, so we structure your mortgage products accordingly and make sure we are looking for the right properties for your budget and game plan. For instance if you have a 10 year plan we could look for a strong rental income with focus on growth. If you are looking for an immediate income, then you might want to look at our Student Rental HMOs in Cardiff which pull in a huge monthly income. Lets take a look at some capital growth strategy properties first. These are past examples and are in line with our research criteria giving you a great return on your investment. Hayes - Highpoint Village Hayes Highpoint village stands to benefit from several growth indicators which offer investors attractive returns. Firstly, the location is set to benefit from being at the start of the £16bn 2018 Crossrail project. Just 6 minutes from Heathrow and 17 minutes from Paddington Station, this site beside the canal and the Hayes & Harlington Station offers everything we look for in an investment. The old EMI record factory is being re-developed as major multi-million town centre developments. These properties come with concierge service, gym, Jacuzzi and communal area. • Price for 1 bed studio - £145,000 • Rents £800 pcm (6.5% yield) • Parking worth £10,000 discounted from the purchase price. Stratford - Lett Road These one bedroom apartments on Lett Road, Stratford were perfect for investors because the site had a ready made growth story to buy into, with the Olympics being held in 2012 and the use of the stadium and local area guaranteed from an economic point of view. West Ham FC took the stadium and Westfield Shopping Centre, the largest in Europe brought 30,000 new jobs to the area. The image on the right hand side was taken from the rooftop of the property, and in the distance you can see the Olympic stadium. So this site fitted our research criteria of seeing a growth story emerging and where an unloved area is becoming loved, with lots of investment in the area for the long term. Here is how the numbers stacked up for this property. • Market Price from £235,000 • Negotiated Discount Price from £199,750 • Equity= £35,250 (17.6% discount) • Rental PCM - £1300 (7.8% yield) • Deposit required £49,940 • Mortgage Monthly Payment £998 • Management Fee £196 • Monthly Income £106 This property has now re-valued in 2013 at £255,000, so the investor is able to remortgage and draw down further equity to build his portfolio. Ann Arvor - Cornwall Two bedroom apartments with open plan living / dining room and kitchen. A fantastic holiday home or first time property! All have allocated parking spaces and overlook mature woodland. These new homes are located close to St Austell and Truro making them ideal for first time buyers, home movers, investors, or as a holiday home as it is close to The Eden Project and two golf courses and a private beach. • Market Price £160,000 – • Negotiated Discount Price £134,995 • Equity= £25,005 (18.5%) • Rental PCM - £625 • Deposit required £33,750 • Mortgage Monthly Payment £422 • Management Costs £110 • Monthly Income £93 (5.5% yield) • Value in 10 years £355,592 assuming 8% per annum growth. David WIlson Show Home Leaseback Here is another strategy that the Midas team can offer when the timing is right. It's called a Show Home Leaseback and is a strategy which offers a guaranteed rental income at twice the market rent. It also offers a guaranteed capital growth strategy because the first owner on the plot benefits from the price rises that occur for equivalent properties within the development as each phase is completed. This one was in Yeovil with David Wilson Homes. They required a 25% deposit at the time, but some lenders will start at 20% deposits. Basically, you are the landlord and David Wilson become your tenant and they are probably the best tenants you could wish for because they keep the property in immaculate condition as it's their sales office and show home, so it has to be in top condition. After the rental guarantee period is over you can keep all the fixtures and fittings. • Purchase price £345,000. Discount £15,000. • Rent guaranteed at £2512.00 per month for 3 years. Mortgage payment of £873. Rental profit = £19,668 per annum. (5.7% yield) Wyndham Park is a stunning flagship development of two, three, four & five bedroom homes set on the edge of stunning countryside. The development will encompass both relaxing riverside walks as well as new local amenities such as a planned new community centre, sports hall and swimming pool. The environment has been a key factor in the design of Wyndham Park. There is provision for children's play areas and green public spaces as well as new public transport links and cycle ways. Wyndham Park is also ideally located for the A303 and the Yeovil Junction mainline station. Frederick Mews - Fistral Beach - Newquay With 247 flights per week, Newquay is arguably the best location in the UK for surfing and its the most desirable holiday hot spot for its wonderful Cornish beaches and coastline. Jamie Oliver and Rick Stein both have restaurants in Watergate Bay and Padstow and with rental incomes being so high during peak season, the apartments we source can be run either as a holiday rental home or on 6 month tenancies. Frederick Mews is kitted out with surfboard racks and dry rooms for the wet suits, so it's tailor made for the surfer. • Market Price £220,000 • Midas Price £180,000 (40k equity = 18% discount) • Rents £825 pcm on 6 month tenancies (5.5% yield) For all of the showcase properties we have shown you so far, the strategy is to get you maximum capital growth so we can grow your portfolio as quickly as possible. So, we are looking for a growth story in the medium term to help us do this. Without any capital growth, your capital will be tied up and not working for you. We understand that for a truly diversified portfolio we must source properties that are going to give massive value in terms of yield. So we have identified a very effective strategy which delivers both capital uplift and a yield in a stunning manner. Cardiff Student HMOs An HMO is a House of Multiple Occupation and we know that in Cathays, the most densely populated and most desirable student location in Cardiff, we have found the "Golden Triangle" as it is affectionately known to investors. With our excellent relationship with local agents, we are able to source a three bed terrace student house for £160k and then with £100k investment, turn it into a money making seven bed HMO, generating a massive £25,600 per annum rental income. After expenses, this works out at £1159 per month net income. What's more, after six months, these properties can be re-mortgaged at £300k, which means a full £97k is drawn back out of the deal for the investor. This represents a 22.4% return on capital invested and the yield is a stunning 10.5% after 1 year. Take a look at the build process. The entire build process is managed by the Midas team, and your property is rented out for you with minimum fuss and maximum income for you. These are just a small fraction of the properties we have on offer at any given time at Midas. We'd love to take the opportunity to show you what we can do for you to get your money working really hard for you. The sooner we achieve financial freedom for you, the closer we are to achieving our aims. Wishing you every success. Robin Robin Campbell (Director @ Midas) ....helping people profit from property and design a life of choice 0117 9117590 | 077 6660 6662 | Website | robin.campbell@midasestates.com Watch our Online Property School >