Are you going to let us know these cheaper and easier ways?
glenn“I should be content to look at a mountain for what it is and not as a comment on my life” D. Ignatow
Harsh comments on this topic from a friend of mine from the UK:
“If you bought anything for 18-40K pounds in the UK especially around Manchester then you would:
1. Be buying in a disaster area full of druggies, pimps and wino’s.
2. The property would be fit for the wreckers and it would be ready to condemn.
There are no worthwhile properties in or around Manchester for that price that would give you anything like that return.The suggestion is at best misleading, delusional and at worst akin to pyramid selling or buying a high rise in Surfers for the ‘investment’. MAD!
Most of manchester is a tip, a place to wipe your feet after visiting, a place to run not walk from – those prices get you a public housing unit in a REALLY POOR area at best.”
Jimbo,
Would your friend from the UK be an Arsenal supporter, or dare I say it, a Milwall supporter?
Cheers
Jeffyou would have to speak to afloat, i only really understood what to do.
as for slum area’s i totally agree, i would not under any circumstances buy sight unseen over there. but there are definetly oportunities to be had. afloat seemed to know what he was talking about, but then again i dont know him from a bar of soap, which is why i asked to meet with him after his next trip. my sister lives in yorkshire so i have pestered her to find out any information on the area’s as well for me.
i will definetly be looking into it more closely, and at worst ive wasted some time and effort.
will let you know how i get on
cheers
shaunLead, Follow or get out of the bloody way
Hi all, been a bit busy lately but I shall fill in on the queries raised, have had to put off going back to UK for about 2 weeks.
Melbear – It costs me approx 3k for 2 weeks – I stay with family in Chorley and have the use of their motor (but I still gotta pay $2per litre for fuel) and yes it is claimable against my property there.
For the moment I am buying in my own name, it suits me. It is also speedier to get refinanced as buying through a trust/company takes 2-4 weeks longer. Yet there is no problems in buying through either setup.Richmond/Pisces/Pulse69 – I have bought the first 2 properties after going to the area and doing some nosing around. I have done alot of research over the last 4 years in getting to know my target area. I have looked many different ways of approaching Manchester and all the upsides as well as downsides. The professional people I have in place to handle my property have been put through my “mill” and we now work as a team to achieve the best result for my situation. I am now confident in buying sight unseen, yet it is wise for everyone to be comfortable with what they are getting into.
Salubrious – is it too good to be true? mmm well the way I have looked at it is in the similiar way to buying property here in Australia. Just get to know what you are getting yourself into, understand all aspects and ask heaps of questions. I agree that there are some opportunities out there that are too good to be true, yet until some other party tells me otherwise about Manchester, to me it is a good area to pursue.
Shaun – we had a good chat yesterday and I was able to go through much more than my typing speed allows me. If, at the end of the day I have helped someone else in some small way then so be it. I’m just sharing a new area that I found and if someone else benefits, great.
Recoveryman – easier and cheaper to set yourself up for the UK to then be able to but property. This has been gone over in earlier posts, yet in brief, I have used the equity in my home here to buy my first property in the UK. From there the UK/Euro lenders see that you own that first property outright. I then borrow 80% of the new valuation of the first property to buy my second property. Just remember to buy approx 20/30% below FMV each time to then enable the refinancing mechanism to work.(I do all the buying in my own name)
There are a few areas to get around, building insurance as a foreign landlord and applying to the tax dept for an exemption as a foreign landlord. My accountant in the UK is putting together all the necessary info for this position. They are all straight forward processes yet they need to be addresses correctly.
Refinancing is fairly straight forward, the criteria that lenders look for is 1. ability 2. willingness and 3. security
There are no problems for applying for finance as either an individual/company or trust, just the latter 2 take more time.Jimbo James – it would be good if your friend from UK could put some comments up on this post regarding his personal experiences of purchasing investment property. He must obviously be aware of the government/private regeneration programmes that have been in place since the mid 80’s.
Manchester is a very large area (approx 4.2 million people) and yes there are bad areas. Yet there are also good and in between areas. Is it not similiar to say Bris/Syd/Melb where there are all of the above. Also CPO’s property make for buyer beware.Shaun n others – nobody really knows me from a bar of chocolate, yet over time you may get to find out that I am either OK or otherwise. I’m just putting in my 2 cents worth. If it is of any benefit, good, if not then at least we are sharing information in the hope that it makes others aware of what to look for in doing their DD and becoming comfortable with there new investments.
Regards
Afloat – head above water
my apologies if i have offended you mal.
that was never my intention, i was just making an observation.
i have emailed you with a more personal apology and i hope you accept it.
cheers
shaunLead, Follow or get out of the bloody way
Hay Shaun,
I’m pretty thick skinned and I didn’t think in any ways that there was an “offence” committed.
Observations are great, responses are important and freedom to information makes things posibble.
I accept your observations, and all others for that matter
Regards
afloat – head above water
Morning all,
It has been at least 2 weeks since we started out on this topic and I’m interested to see how much homework has been done by people’s.
It has been good reading back over all the posts, some good comments and some negative comments.
Has anyone done some digging on the Manchester region and would like to share their finding. There was some very negative posts, was this either through personal experience or just lip service. Was there any following up of this lip service to clarify the situation? The positive posts had comments/queries that were very logical and believable. They appeared to be from property investors already holding property, and asking very simple, straight forward questions with relevance to their own positions. They seemed to know what questions to ask and from there determine if there was substance in the answers.]
Maybe the newbies and people not yet holding property( yet with alot of theory behind them) could learn from this, the type of questions that are asked that would seem legal, logical and believable.
It is always best to do your homework and become comfortable with the field your are involved in. Yet there is a point that you will go to where the next place to learn more is the “real thing”. Purchasing that first property, on the job training, that will give you that confidence and be able to put all your theory into practice!
So I encourage both ongoing thoery and practical training to everyone.
Regards
Afloat – head above water
Afloat,
I have been researching the UK market in general for some time. What I have found talking to friends and relatives and re agents is that their market is booming and most major cities have experienced high growth, but there are still aeras lagging in North England and Scotland. 10%yields are common and up to 15%. There is talk over there about a correction being well overdue in the South and cool off in other areas.
The London press are tipping some areas of North England as being good growth spots maybe just playing catch up to surrounding areas. London and southern landlords selling in South and buying in North.
Other differentiators are lower interest rates, tennat pays rates and no stamp duty under 60K pounds. The oz $is realtively okay against the pound right now but might slip in the future.
With respect to Burnley the British and European Govt are providing regeneartion funding in an attempt to raise the local amenitey as the area has been depressed for a long time. The local press are talking about active crime reduction and there are many stories on private busines setting up in the area and old disused mills etc being bought up by investors with the view to turning them into tourist attractions and theme homes.
One other differenatior from OZ and NZ is that instead of more houses being built the authorities are actually purchasing property and demolishing it. You wouldnt want to invest in one of them flip side is there shouldn’t be an oversupply.
So thats what I have found on this subject. Hope it proves useful to someone.
Hi Bardon,
Certainly some good points there to be taken on board.
The point about the government demolishing unsafe property is very valid.
Just for others in their DD, check in the searches that the property doesn’t have a CPO (compulsory purchase order) put on it.This has been an area where many “investors” haven’t fully understood what they are getting into.
This means that even if you paid £35k for the property, the gov’t will pay you £9k, so this is where investors have come unstuck. At the end of the day they haven’t done their DD.Thanks bardon
Regards
Afloat – head above water
In Australia, when a property is designated for government acquisition (for example, for road widening purposes) they would be paying full market value (if it ever came to them actually exercising their right to buy).
Wouldn’t the same kind of rules apply in the U.K. ?
Carlos
Hi Carlos,
Different rules for each country.
There are many properties that have CPO on them and it is a mix of private and council housing. Majority is council.
Just remembering that there are dozens of property that you could buy today for £3k, yet when you search they all have CPO’s. The gov’t don’t actually state when the property is to be demolished, yet if you look into the “big picture” of what the government are doing in that area it may give you an idea of when. Just look at areas of regeneration and this is a general clue as to what is going on both short and long term.
There are rows and rows of property just boarded up (like on Coronation St) unsafe for habitation. There are unsuspecting people being sold these properties and suffering because they don’t do their homework. They believe the sales agent and these buyers are usually from outer town.
Thats why it pays to get to know your target area and understand it fully
Regards
Afloat – head above water
I wonder how the ATO would view the claim of one deductible trip to area in which investment property is located annuannly.
Do people pay rent in Iraq?
Hi madhun,
Accounting for your trips to your investment property is a legitimate expense. Whether they be in your adjoining suburb in Aust or on the othe side of the planet (Manchester or even Iraq).
It doesn’t matter to the ATO how effecient you are in your travel arrangements (you could fly first class or economy) to the other side of the planet or you could get a chauffeur limo or walk to visit your adjoining suburb, as long as you can afford the expense. (time and money wise).
You are going to your investment property/ies to check on the running of your “business” operation. I don’t think you would “set and forget” or live in the hope that they look after themselves. Monitor and maintain.
Regards
Afloat – head above water
Hi Afloat
Im going over to london in july. I might have a look around for an ip while over there. It is that easy to buy property in uk. Can is use the equity in a place over there to purchase in uk.
Hi there nathfromperth,
London in July, at least it will be a touch warmer than usual I think.
It is very similiar to purchasing property in Aust. Equity to purchase property works well in both countries. Just go and soak up information that is relevant to your needs/requirements.
What I did , before I went to UK, was write down what my objectives were. How much time did I think I was going to need and where was I going to spend my time best.
Much similiar to researching a new area in Aust.I found I spent quite a bit of my time with a referdex (street map) and working out on how to get somewhere, whether it be by car, train or metro. This took me more time than I planned, yet you then get the “feel” of the place in doing this, so it is time well spent.
You say you “might have a look around for an ip while over there”. If you haven’t already, work out at what stage you are at regarding property. Have you done the homework on your area and feel comfortable knowing that all the pieces are in place, your property puzzle is taking shape.
happy hunting
Regards
Afloat – head above water
Thanks for that reply. Sorry i should have been a bit clearer, Im going over there for a wedding and now may spended some of the time to have a look around for a property aswell.
Have fun nath
This is my first post. I found this thread very interesting because I live abroad. One thing that I thought may assist people if they are interested is the multi-currency loan – particularly if you are purchasing the property for a capital gain. National Australia Bank and HSBC both offer these products and you have a basket of 5 currencies (of your choice) and you can change currency with 24 hours notice. The first two changes are free and thereafter there is a changeover fee.
As I am outside Australia I was interested in property in Australia, but so far despite fairly extensive searching have not found any that satisfy the 11 second rule in Aus. Does anybody have any areas to recommend there?
“Harsh comments on this topic from a friend of mine from the UK:
“If you bought anything for 18-40K pounds in the UK especially around Manchester then you would:
1. Be buying in a disaster area full of druggies, pimps and wino’s. “Haha, sounds like what Auckland w@anker friends of mine said mid-2003 when I was buying cheapie houses in Taumarunui, (in fact most of NZ) for 16-30k
The 16k houses needed work, the 30k ones were palaces!“2. The property would be fit for the wreckers and it would be ready to condemn.”
see above!
“There are no worthwhile properties in or around Manchester for that price that would give you anything like that return.”
Paradigm. My Auckland friends said the same thing. They are begrudgingly now admitting that I did get 106 percent cap gains while earning 20-24 percent cashflow at the same time. They are now starting to look at areas outside Auckland.
Even within Auckland the worst suburbs (Otara, Manurewa, Papatoetoe) from memory – are the ones that performed the best in CG’s. More than the blue chip Takapuna type suburbs that everyone who doesn’t know anything thinks will get more cap gains.
“The suggestion is at best misleading, delusional and at worst akin to pyramid selling or buying a high rise in Surfers for the ‘investment’. MAD!
Most of manchester is a tip, a place to wipe your feet after visiting, a place to run not walk from – those prices get you a public housing unit in a REALLY POOR area at best.”OH dear oh dear, if it didn’t sound so damn familiar, I’d take more time to respond, but it is EXACTLY what people were saying about NZ. Now it’s been ‘proven’ that a lot of people did make money and others followed so the legend perpetuates. But I feel as though afloat may be to the UK what Westan and I were to NZ. I.e. the first couple of people to talk about what you could find there deal-wise in a new territory where what we were doing was way way in the minority.
I’d personally bank on Afloat being dead on. And afloat LOVE to talk about doing business with you!
cheers-
MiniPS Allyvn
I am a bird dog in NZ
We have all these local spotters who sign up deals and we provide 50-60 photos, a blurb, title search, etc – everyone who spots deals for us also invests in their area so knows all the good inspectors, rental managers etcour list is free to get on and $2500 upwards to take a deal ($2500 for the typical cheapie deal under 100k.)
Most of our deals are CF+ve unless they are just under – say “9.5 after reno” in a big city like Christchurch. We occasionallly put out “unusual deals” – like we have one at the moment, that are pretty interesting, although not CF+ve – such as we have 3+ hectares of land in a city of 66k for 360K where land is scarce 7k from the CBD which would chop into 17-30 sections depending on size, comes with a feasibility report which we are getting on Monday with costs and timeframesour list is free to be on
Hi Mini,
I would love to get on your list. I am open to NZ (although I haven’t been there) as I have quite a few friends who are posted here right now who are from there, so I can grill them for information. Please let me know how to get onto your list.
I am an accountant and we are posted in Vietnam, with the objective of funding our retirment through our overseas work stint. Obviously, access to information is a little difficult here, especially as the internet is so, so slow.
I am about to do my first CF +ve deal in Vietnam. US$60,000 for a 2 BR apartment returning 125/week in rent. Due to the odd rules relating to property etc here, you can only leverage up to 50% and the rates are ridiculous (11%), hence my knowledge of the offshore multicurrency loan, because I borrowed against property I had in another country which was debt free. The USD fixed rate for 12 months is only 3.65%.
I have helped a few people to financially structure offshore transactions in a cost effective manner, so would be pleased to assist anyone who has questions on that side.
Well, back to the grindstone.
I look forward to joining your list.
Regards
Ally
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