London’s buy-to-let pain has become Manchester’s gain says Jean Liggett

London’s buy-to-let pain has become Manchester’s gain says Jean Liggett

United Kingdom

It’s fair to say that uncertainty has been the order of the day in the UK’s buy-to-let property market at the hands of government for the past year.

2016’s shock Brexit decision followed by a hung parliament this year combined with stamp duty hikes, the removal of mortgage interest relief and imminent introduction of tougher lending criteria for portfolio landlords has created an aura of uncertainty and caution in the buy-to-let market.

The UK’s capital, the ever-shining star of London seems to also be fading with house prices down 0.6% and private rental prices behind the national 12-month growth rate according to the latest ONS data.

So, has the last 12 months permanently dampened the appeal of the UK buy-to-let market? Should buyers be investing their funds elsewhere? Critics are divided.

“The uncertainty that the UK buy-to-let market has experienced over the past year has undeniably impacted investor confidence but it seems to be primarily aimed at London. With interest rates remaining so low, investors still see the merit in purchasing bricks and mortar but those seeking maximum returns in 2017 are increasingly looking at other areas than the Capital. By keeping an eye on regeneration plans and new transport links, it is still possible to find great areas to invest in.”

Jean Liggett, CEO, Properties of the World

Indeed, despite splutters in the London buy-to-let market, buoyant activity is being witnessed in other parts of the UK. Greater Manchester has become a key destination for property investors and thanks to its strong demand from buyers and renters alike, the city continues to register a strong house price growth rate of 6.7%, according to Hometrack.

“As we have seen the capital’s market decline, other UK cities have stepped up and taken its place. London’s buy-to-let pain has become Manchester’s gain!”

Jean Liggett, CEO, Properties of the World

Due to its proximity to both MediaCityUK and Manchester city centre, Salford Quays in particular is leading the way when it comes to buy-to-let growth.

2017 marks 10 years since major transformation began in the area, kick started the BBC’s decision to move many of its jobs from London to Salford Quays. This £650m regeneration project has boosted the area’s credentials for buy-to-let investment and Manchester has ascended to one of the top 10 buy-to-let areas in the UK according to a recent report by LendInvest.

The latest HM Land Registry data paints a positive picture for Salford with a 5.9 % growth in house prices recorded between June 2016 and June 2017. Whilst savvy investors will be watching with glee as news of more A grade office space is being snapped up in Manchester (law firm Freshfields Bruckhaus Deringer is taking space in Salford) indicating a thriving local economy and growing rental housing demand.

Jean Liggett, Founder and CEO of investment agency Properties of the World is convinced of the merits of Manchester with her latest buy-to-let offering to investors launching this week.

Manchester Waters in Salford Quays is comprised of five phases and a total of more than 500 apartments, ranging from studios to three beds. All properties will be furnished to the highest standard, and most will benefit from the spectacular view of the waterfront.

The location of this development is unparalleled, with two Metrolink stops located within a 5-minute walk, residents can reach Manchester’s city centre with ease. Additionally, with Manchester Waters being situated right in the heart of Salford Quays, home to MediaCityUK, it is perfectly placed to house local workers and students attending the nearby university campus. Apartments are available to purchase from just £109,995 for a spacious studio apartment and returns of 6%.

For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555. 

 

Doncaster delights investors with cultural appeal and solid property price rises

Doncaster delights investors with cultural appeal and solid property price rises

Uncategorized United Kingdom
  • Doncaster house prices up 15.98% over past 5 years (Zoopla)
  • New Northern Cultural Regeneration Fund to provide £15m for tech, creative and cultural sectors
  • Grade II listed Danum House redevelopment honouring Doncaster’s art deco heritage (Properties of the World)

The northern market town of Doncaster is delighting investors and art aficionados alike, thanks to its extensive cultural offering. Now, the town is also set to benefit from the government’s new £15 million Northern Cultural Regeneration Fund.

“Doncaster is a surprising location in many ways and the government’s commitment to investing in the North of England positions it well as an investment prospect. Right now, Doncaster is a key up and coming location for residential property investment and we’re seeing an unprecedented level of interest in what the town has to offer.”

Jean Liggett, CEO, Properties of the World

 

The £15 million Northern Cultural Regeneration Fund follows a series of government commitments to the North of England. The level of investment is such that Philip Hammond MP, Chancellor of the Exchequer, observed, “if the Northern Powerhouse were a country, it would be amongst the biggest economies in Europe.” The cultural fund will boost the extensive investment by focusing particularly on the region’s tech, creative and cultural industries.

This £15 million fund is a fantastic chance for towns and cities to develop inspirational projects that could have a transformative local effect – particularly in communities that have seen less cultural or creative investment in the past…. We want as many people as possible to benefit from the Great Exhibition of the North, and this fund will boost the Northern Powerhouse and help build a lasting legacy across the whole region.

Karen Bradley, Culture Secretary

Within Doncaster, one of the city’s landmark art deco buildings is leading the way when it comes to showcasing the region’s regeneration. The grade II listed former department store, set in the heart of the town, is the subject of a major redevelopment that will see it transformed into spacious, open plan apartments, complete with rooftop cinema and concierge service. The emphasis on keeping the original character of the building – known as Danum House – is turning this into one of Doncaster’s most exciting and unique residential developments.

As well as the town’s cultural attractions, investing in buy-to-let property in Donacaster makes financial sense too.

“Prices in Doncaster are extremely low at present. From as little as £83,000 here, you can buy a one-bedroom apartment of 465 sq. ft at Danum House. These are seriously spacious apartments that offer a high standard of living and their central location is perfect for attracting tenants looking for the best that the town has to offer.”

Jean Liggett, CEO, Properties of the World

 

Doncaster has enjoyed house price rises of 15.98% over the past five years, according to Zoopla. Property market experts such as those at Properties of the World are keeping a close eye on values, with prices tipped to be on the verge of rising at rates similar to those that we’ve seen in northern cities such as Manchester. With so much being invested in the local area, it’s only a matter of time!

For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555.

Stamp duty free UK hotel room investments heat up as summer staycations soar

Stamp duty free UK hotel room investments heat up as summer staycations soar

United Kingdom
  • 55% of British adults will opt for staycation this summer (Travelodge)
  • UK tourism thrives with overseas visitors on the rise (ONS)
  • UK named top European target for hotel investment (CBRE)
  • Hotel room investments exempt from stamp duty tax (Properties of the World)

It’s fair to say that Brits are getting less for their money abroad as an enduring weak pound draws more and more to ‘staycation’ this summer.

Travelodge reports that 55% of British nationals are expected to spend their holiday in the UK this summer with ‘staycationing’ thriving as sterling continues to bear the brunt of economic uncertainty at home.

Alongside the increase in staycations from domestic tourists, ONS reports a spike in overseas residents coming to the UK for a holiday, with an increase of 19% when compared with April 2016. The hottest June on record and the drop in sterling has boosted demand from overseas visitors.

“It is very encouraging to see the continued growth of the UK tourism industry from both British nationals and overseas visitors especially as we are heading into the peak summer season where coastal resorts are gearing up for a very busy period. With increasing demand for UK holidays, now is the perfect time to branch out and make a hotel property investment and Devon is the perfect place for it.”

Jean Liggett, CEO, Properties of the World

 

Indeed, this dynamic growth in the UK tourism industry is also set to yield the investment potential of UK hotels.

Investors have named the UK as the top target for European hotel investment in 2017, according to a survey by CBRE. And as investment in traditional holiday homes wobbles due to recent stamp duty changes, hotel room investment offers an attractive alternative to buy-to-let property.

 

“One of the main appeals of hotel room investment is that stamp duty is not payable, potentially saving owners thousands of pounds. Owners can still enjoy personal usage of their hotel room but they will also receive regular income without hefty upfront taxation and management costs.”

Jean Liggett, CEO, Properties of the World

 

The opportunity to make a hotel room investment has reached the hugely popular holiday shores of Devon, crowned by Travelodge as the favourite staycation destination for 2017, with 4* hotels such as Atlantic Bay.

 

Comprising 96 bedrooms, not only will Atlantic Bay be prominently positioned above Woolacombe beach – ranked in the top 10 seaside towns with the highest property values according to Zoopla – but it will also offer sea view across the Atlantic Ocean.

Investment in rooms at the coastal hotel is from £85,000 with 14 days personal usage per annum and returns of 10% for 10 years. The hotel will also boast a lounge area, large conference room, swimming pool, fitness suite and cocktail lounge bar – ideal for the growing number of visitors to this hugely popular resort.

 

For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555. 

 

This summer’s most exhilarating investment!

This summer’s most exhilarating investment!

United Kingdom
  • New Afan Valley Adventure Resort to cover 485 acres in South Wales
  • Visitors set to generate £6.5 million of consumer expenditure per year
  • Luxury lodges available to investors looking to be part of the immense project from £149k
The brand new Afan Valley Adventure Resort is set to bring massive economic benefit to South Wales.
£130 million of investment will create 1,000 full time jobs and it is estimated that visitors will generate £6.5 million of consumer expenditure per year which will be spent on site and within the local area.
Just ten miles south of the Brecon Beacons, mid-way between Cardiff and Swansea, the outstanding natural beauty of Afan Valley will be the location of ‘the world’s ultimate outdoor adventure’ covering some 485 acres.
From high octane flights down zip wires, to scaling challenging climbing towers and exploring treetop playgrounds, visitors will be offered an adventure experience like no other.
“Afan Valley Adventure Resort will offer activities for the whole family. From seasoned adrenaline junkies to those looking to try paint balling, go-karting and water zorbing, there’s plenty to do for everyone.
“Another unique appeal is the Alpine Zone, home to a wealth of invigorating and challenging snow sports activities. The area has all the thrills of a popular and traditional ski resort complete with lifts, time gates, slalom courses, tubing, moguls, ski-school, toboggan runs and finishing the day with a backdrop of music, fireworks, professional ski displays and the bustling alpine bars are just some of the amazing selling points to this multi-million-pound project.”
Jean Liggett, CEO of Afan Valley investment agency Properties of the World
A superbly designed 100-room hotel and 400 elegant lodges, along with high end restaurants, bars, retail outlets and Rejuvenation Centre plus a host of other activities (mountain biking, a luge track, roller-skating and more) will complete the impressive offering.
The luxury 2 – 4 bedroom lodges are available from just £175,000 through Properties of the World. Managed by an experienced resort operator, the lodges will be leased out to holiday makers earning the owners an 8% NET return for 7 years as well as the opportunity to enjoy 2 weeks free personal usage per annum.
The team behind Afan Valley have committed from the outset to associating only the best international brands and global icons with their undertaking – hence the recruitment of the ultimate adventurer Bear Grylls to represent the adrenalin-fueled project and to bring his Bear Grylls Survival Academy. The result will be a truly world-class experience that is set to have a significant impact on the tourism industry in South Wales.
With the Brexit-related reduction in sterling’s value making the UK an attractive holiday destination both to those from overseas and to Brits staycationing, Afan Valley Adventure Resort has come at the perfect time.


For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555.


UK versus Europe – where to invest as Brexit unfolds

UK versus Europe – where to invest as Brexit unfolds

United Kingdom , , ,
  • Currency fluctuations put volatility at the heart of many sectors (easyMarkets)
  • UK property investment offers exciting opportunities in new sectors (Properties of the World)
  • Spanish property investment provides long term lifestyle benefits (Kyero.com)
  • UK’s fundamental shortage of housing unaffected by Brexit (Aspen Woolf)

The UK will be very publicly facing off against the EU over the coming two years. Whether you voted for or against the split, the political and financial implications of the UK’s decision to leave the EU are huge. Now, Prime Minister Theresa May has called a snap election called for 8 June, in order for the Conservatives to take advantage of their largest lead in the polls over Labour in nine years (according to YouGov). Sterling’s turbulent journey since the Leave vote doesn’t look set to enter calmer waters anytime soon.

Sterling will be one of the most responsive barometers to the political machinations of the Brexit process. While many sectors will be affected by the UK leaving the EU, few react in real-time in quite the same way that currency markets do. The impact of changes in the pound’s value is felt in myriad ways, putting volatility at the heart of many sectors over the coming years.”

James Trescothick, Chief Global Strategist, easyMarkets

Property investment is certainly one sector that is sensitive to sterling’s shifting value. So should buyers be looking to pick up property in the UK right now, or investing their funds elsewhere? Sector experts’ opinions are divided.

“Those buying in pounds may find their second home overseas is suddenly worth a great deal more – or less – as the pound and the euro dance around each other. The same is true of the pound and the dollar, with the US experiencing its own unique style of political upheaval right now. UK buyers seeking stability from their investment might find it prudent to seek out domestic property investment opportunities over the next couple of years.”

Jean Liggett, CEO of visionary property investment consultancy Properties of the World

Liggett points out that domestic property investment still offers a wide range of opportunities. The UK’s hotel and care home sectors are offering some of the most exciting property investment possibilities at present.

While UK hotel investments often come with the benefit of two or more weeks’ use per year, many investors want a property that comes with the promise of sunshine, and continue to look overseas to make their money work for them.

“The fact that investors can pick up a property in Spain, use it themselves whenever they want, then leave it to their children as an inheritance or sell it a few years down the line, means that many British buyers are looking beyond short term currency fluctuations and pushing their pounds into properties in the Spanish sunshine. UK visitors to Kyero.com surged by over 30% in the year to March 2017, demonstrating that many are looking at investment in Spanish second homes over the longer term. The comparatively low cost of property in Spain also means that UK buyers can get more for their money when they invest abroad.”

Richard Speigal, Head of Research at Spanish property portal Kyero.com

For those seeking a purely financial investment, with no lifestyle benefits attached, the stability offered by buying in pounds is certainly a strong draw at present. The UK’s buy-to-let sector continues to perform well and the nation’s city centres look set to remain short of homes for many years, irrespective of Brexit.

“The UK’s decision to part ways with the EU does nothing to change the fundamentals of this country’s housing shortage. That shortage, along with a shift from ownership to renting, is driving demand for city centre homes like never before – and Brexit has done nothing to change that. Each year the UK falls further behind its target number of homes and until that alters, the logic of domestic buy-to-let investment is clear.”

Oliver Ramsden, Director of  Aspen Woolf

Ultimately, then, the decision on where to invest as the Brexit process unfolds will depend on the kind of benefits that individual property investors are seeking to get out of their investments, as well as how short or long term their outlook may be.

 

On the market:

Gramont House – care home investment from £75,000, based on a sustainable and ethical business model. 8% NET returns for 25 years, with four exit strategies and two purchase options. (Available through Properties of the World.)

Alicante penthouse – three bedroom, two bathroom penthouse apartment with large pool and tennis court on site. 600m from the beach. €185,000. (Available through Kyero.com.)

Eldon Grove – a refurbished, Grade II listed building housing 45 one, two and three bedroom apartments. Designed by experienced and successful architects. Prices from £94,950 with 7% NET yield assured for two years. (Available through Aspen Woolf.)

 

For more information, please contact:

easyMarkets: +44 203 1500 748 or www.easymarkets.com

Properties of the World: +44 (0)20 7624 5555 or www.propertiesoftheworld.co.uk

Kyero: www.kyero.com

Aspen Woolf: +44 203 176 0060 or www.aspenwoolf.co.uk

 

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Bristol is top of the class for PBSA investment

Bristol is top of the class for PBSA investment

United Kingdom
  • The University of Bristol has over 22,000 students yet provides just over 6,000 beds (The University of Bristol)
  • Latest UCAS data reveals that whilst applications might be down nationally, the University of Bristol remains a popular choice (Pro Vice-chancellor, University of Bristol)
  • ‘Perfectly situated next to the new university campus, The Grosvenor is the ideal PBSA investment’ (CEO, Properties of the World)

Bristol is a thriving city, situated just 120 miles from London and home to over 22,000 students studying at the University of Bristol (2016/17). However, just over 6,000 beds, just 27%, are available to these students via the university according to their website.

It is clear that demand for student accommodation in the city is high not only from the booming student population but also with investors looking for a cheaper way to enter the buoyant market. With property prices rising faster than London (Hometrack) and around 16,000 students not being offered accommodation by the University itself, investment into PBSA (purpose built student accommodation) In Bristol is an attractive proposition.

The Grosvenor, available through Properties of the World is the ideal student accommodation investment option within the city, offering 144 studios located next to the new £300 million University of Bristol campus set to open in 2020.

The University of Bristol is one of the most popular and successful institutions in the UK according to the QS World University Rankings for 2016-2017. It is firmly in 9th place and according to Dr Erik Lithander, Pro vice-chancellor, the latest UCAS data has revealed that applications might be down nationally yet the University of Bristol remains a popular choice.

Dr Lithander explains that the total student numbers attending for the 2016-17 academic year were 22,427 and that the university’s aspiration was to grow their student body by around 3% for the 2017-18 academic year.

Indeed, with the University of Bristol so determined to grow its population so too is the local student property market.

Jean Liggett, CEO of visionary property investment consultancy Properties of the World explains further why the Bristol market is a great opportunity for those looking at student property as an investment choice,

‘Perfectly situated next to the new University of Bristol campus for 2020, The Grosvenor is the ideal investment. Demand for student flats in this area is expected to be high as the convenience of being able to access campus quickly and easily will be a top priority for students.

“The site is also opposite Temple Meads train station so if you are looking for a promising investment in this booming city where the average price per student bed is over £10,000 more than the Grosvenor (Knight Frank), then now is the time to act as units are selling fast.”

The comfortably sized student apartments offer a modern living space in Bristol Temple Meads. The apartments consist of a single bed with en-suite bathroom facilities, a kitchenette finished to the highest standard and facilities such as a laundry room, gym, secure storage, communal lounge areas with pool tables and ample study spaces.

From £99,000 per studio, the 6-floor block, with 144 apartments are a unique investment opportunity that provides a passive property investment that delivers 7.5% NET return for 5 years with an option to extend. For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555.

Adventurous families choose the UK for holidays AND investments as Brexit approaches

Adventurous families choose the UK for holidays AND investments as Brexit approaches

United Kingdom
  • Family staycations to jump from 29% to 37% in 2017 (Travelzoo)
  • Inbound visitor numbers hit record levels in Nov 2016, up 17% in 1 year (ONS)
  • Blended UK holiday homes and investments set to benefit from Brexit (Properties of the World)

The UK’s tourism industry is looking forward to a bumper summer this year, if current trends continue to play out.

According to Travelzoo, 37% of Brits plan to take their main holiday in the UK in 2017, compared with 29% in 2016. Pre-Brexit wobbles and an austere budget are no doubt playing their part in families’ plans, but it’s not just cautious Brits who are choosing to spend their leisure time in the UK.

The country is also proving an attractive destination to overseas visitors. Figures from the Office for National Statistics (ONS) show a trend of increasing inbound visitors over the course of late 2016.

Visits by overseas residents to the UK increased by 1.5% in July to September 2016, when compared with the same quarter of 2016. November then saw a record-breaking month for inbound tourism, with numbers leaping by 17% compared with November 2015 and spending up by 14%, at 3.1 million visits and £1.7 billion respectively.

 

“The charms of the UK as a holiday destination have never been greater. For UK-based families, it’s a chance to take a break without the hassle of long-haul travel, luggage restrictions and bumper flight prices over the summer holidays. For those from overseas, the UK represents great value for money – something which the triggering of Article 50 may well boost further.”

Jean Liggett, CEO of visionary property investment consultancy Properties of the World

 

It’s not just short-term circumstance that is causing families to look to the UK. Adventurous investors are looking at the country’s longer-term potential, with investments like Afan Valley Adventure Resort in South Wales bringing a new dynamic to family breaks.

Investment at the resort is from £149,000 for lodges and luxury villas, with returns of 8% NET for 7 years. Families who invest can enjoy 2 weeks’ personal use of their investment property each year – ideal for those looking to enjoy one of the most breath-taking areas of the UK during their summer break.

There will be a kaleidoscope of adrenalin-fuelled and health and wellbeing activities at the resort. These will range from fabulous spa facilities to more active pursuits, including a water challenge, high jungle rope zip-lining, parachuting and a host of challenges to test teamwork and stamina. The resort promises an action-packed adventure for the whole family and is the ideal way to enjoy the best of the British countryside.

With so much to do on-site, and the ease with which Wales can be accessed, the appeal of such blended holiday and investment destinations is clear. A holiday home for the whole family that’s also a hands-off investment can provide regular income without the usual hassle of cleaning, repairs and garden maintenance that a fully owned holiday home brings with it.

Afan Valley also offers a lower cost investment option. Land plots are available for £25,000, with a mark-up of 10% per annum for three years and an assured buy-back of 125%. They are ideally suited for families looking to take on a smaller investment, or to spread their investment portfolio across a wide range of assets.

“Resorts like Afan Valley are ideal for adventurous families looking to enjoy the best of the UK, from its scenery to its property investment opportunities. With Brexit about to become reality, UK investments with outstanding lifestyle benefits such as this one are well positioned for a rise in popularity.”

Jean Liggett, CEO, Properties of the World

For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555.

Buy-to-let tax changes pushing landlords to alternative real estate investments

Buy-to-let tax changes pushing landlords to alternative real estate investments

United Kingdom
  • New UK buy-to-let tax changes come into effect from 6th April 2017
  • 44% considering alternative real estate sectors in 2017 (PwC)
  • Student housing, leisure and healthcare sectors emerge victorious (PwC)

It’s fair to say that the UK’s buy-to-let property market has suffered quite a few blows at the hands of government in recent years.

The additional 3% Stamp Duty from April 2016 meant that buy-to-let produced lower yields literally overnight and the scaling back of mortgage interest tax relief from 6th April 2017 is also expected to have an impact. Then there’s the whole Brexit issue, which has created a lingering aura of caution and uncertainty when it comes to the property market (though the market has held up well thus far).

 

“The UK buy-to-let market has displayed an impressive level of resilience in the face of these blows. Investors haven’t lost their despite the tax changes and impact of the Brexit referendum. What has been particularly interesting, though, is the scope that the situation has provided for other asset classes to flourish – care home opportunities and even exciting new adventure resorts are all tempting investors looking for strong returns, which many buy-to-let properties can no longer match.”

Jean Liggett, CEO of visionary property investment consultancy Properties of the World

 

PwC’s Emerging Trends in Real Estate Europe 2017 report confirms this. According to the report, 44% of those surveyed are considering alternative real estate sectors in 2017, with ‘alternatives’ boasting the best prospects as the year unfolds.

Healthcare and leisure are cited as two of those alternatives, as is student housing. In fact, “student housing, retirement/assisted living and healthcare” are listed as the three best 2017 real estate investment prospects.

Care homes are an interesting example. At Gramont House in Bingley, investors can enjoy 8% NET returns for 25 years as part of an investment model that has been developed as an ethical, sustainable way to meet the needs of the UK’s ageing population. Investors’ purchases make a difference to the standard of accommodation that can be offered to those in care, as part of a fully hands-off model. Investment is from £75,000, without so much as a hint of Stamp Duty to worry about.

Meanwhile, adventurous investors are turning to new tourism resorts to satisfy their need for healthy returns, as well as to enjoy the lifestyle benefits that such investments offer. The UK tourism sector is booming. The Q4 2016 Hotel Bulletin from AlixPartners projected that 20,000 new hotel bedrooms will open in the UK over the course of 2017. Meanwhile the Hotel Investment Outlook 2017 report from JLL confirms that Europe is expected to continue to show growth in 2017, despite economic uncertainties.

“The tourism industry has shown resilience and travel remains on the increase. The movement of international travellers is expected to grow 4% annually over the next 10 years, resulting in a lot of heads in beds.”

JLL

The long-term prospects of leisure sector investments have caught the attention of many investors who, before the tax changes, might otherwise have put their money into buy-to-let without a second thought.

Figures from the Office for National Statistics show that overseas residents made 9.2 million visits to the UK over the course of the three months to December 2016, an increase of 6% compared with the same period in 2015. North America and Europe drove the growth, increasing their visitor numbers by 15% and 8% respectively.

Developments such as the extensive Afan Valley Adventure Resort are benefitting from both the booming visitor numbers and the shift in investor attention. Land plots (£25,000) and lodges (from £149,000) are offering promising returns, while the lodges come with the lifestyle benefit of two weeks’ usage per year.

Student housing is perhaps the most established rival to buy-to-let in the UK when it comes to grabbing real estate investors’ attention. The model is proven to the point that PwC’s Emerging Trends in Real Estate Europe 2017 report noted that it had spread from the UK and Germany to Iberia, Central and Eastern European countries and the Nordics. 61% of those contributing to the report cited student housing as their preferred alternative investment for 2017.

Modern, stylish student accommodation schemes such as X1 – The Campus in Salford, Manchester show why the model has become so popular. Investors enjoy yields of circa 6-7% NET, students experience a standard of living that would have been unimaginable just a few years ago, and overcrowded university cities breathe a sigh of relief at the swift resolution of their accommodation struggles.

 

 “The UK remains a safe, stable investment prospect, but investors who are seeking maximum returns from real estate in 2017 are increasingly being drawn to alternatives for their stronger yields. Expect this trend to continue for several years as mortgage interest tax relief continues to be phased out.”

Jean Liggett, CEO, Properties of the World

For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555.

Buy-to-let makes way for buy-to-NET as April tax changes approach

Buy-to-let makes way for buy-to-NET as April tax changes approach

United Kingdom
  • “Buy cheap and buy smart” to lessen impact of tax changes (Properties of the World)
  • 440,000 landlords could move up a tax bracket in April (National Landlord’s Association)
  • Cash is king when it comes to beating new taxation rules (Properties of the World)

It’s fair to say that buy-to-let investors haven’t had the easiest time of it in recent years. With the government squeezing an increasing amount of tax out of them, the National Landlord’s Association has estimated that some 440,000 landlords will find themselves pushed up a tax bracket next month.

So, will the April tax changes finally ring the death knell for buy-to-let? Not according to industry experts…

“Yes, the taxation landscape for buy-to-let investors is becoming harsher, but there’s still plenty of profit to be made for those looking in the right places. Investors need to focus on buying to NET profits by seeking out developments with strong yields. The right properties can still produce healthy returns. Instead of the death of buy-to-let, we’re seeing the birth of buy-to-NET.”

Jean Liggett, CEO of visionary property investment consultancy Properties of the World

Landlords have already swallowed the 3% stamp duty land tax on second homes that was introduced in April 2016. Now, from April 2017, they’ll see the tax relief from their finance costs phased out, with the percentage of these costs deductible from rental income dropping by 25% per year until it reaches 0% in the 2020 to 2021 financial year.

The restricted finance costs include interest on mortgages, loans, and overdrafts, including borrowing used to buy furnishings, as well as to cover the purchase cost of the property. For those already in possession of one or more buy-to-let properties purchased on finance, the change means a gradual reduction in profitability over the coming four years.

So what can potential landlords do?

“The simple answer is to buy with cash and thus avoid the tax relief deductions entirely. However, that’s not always an ideal solution for some investors. For those still using mortgage or other finance to purchase a buy-to-let property, the best plan is to buy as if it’s 2021.

Calculate the property’s yield based on the end of the phasing in period in order to ensure that it will still be a profitable venture once the tax changes are fully implemented. Work out now whether the changes will push you up a tax bracket and make your investment decision with full knowledge of that fact.”

Jean Liggett, CEO, Properties of the World

There are certainly still plenty of options available to investors looking to avoid being stung by April’s taxation changes. Purchasing lower cost properties that are more achievable as cash purchases is one strategy.

At Victoria House in Liverpool, superb penthouse apartments are available from as little as £68,750. Such a purchase may well prove a better longer-term prospect than opting for an investment of double that value (or more), which would require borrowing.

Opting for a city flagged as a hotspot is another good approach. HSBC has identified Manchester as one of the UK’s top four buy-to-let hotspots, while Jones Lang LaSalle has projected that house prices there will rise by 4.5% per year for the next five years. Such strong figures can serve to offset reductions in tax relief for investors interested in properties there, such as the brand new development at Barrel Yard.

“Really it’s about going back to basics. Buy cheap and buy smart. Don’t be deterred by the spectre of increasing taxation – those who plan carefully should be able to minimise the impact of April’s tax changes and ensure they still buy to net a healthy profit.”

Jean Liggett, CEO, Properties of the World

For more information, visit www.propertiesoftheworld.co.uk or call +44 (0)20 7624 5555.

Town vs country – the investment dilemma

Town vs country – the investment dilemma

United Kingdom , ,
  • Risk-averse investors drawn to city centre buy-to-let developments (Aspen Woolf)
  • Interior design giving landlords the edge (Alexander James Interior Design)
  • Strong returns tempting investors to newer asset classes in the countryside (Properties of the World)

There’s an age-old debate about whether city living trumps country living, or vice versa.

UN figures show that our world is gradually becoming more urban, with 54% of the global population currently residing in urban areas. The figure is projected to rise to 66% by 2050, emphasising the pull of the city on those seeking economic opportunities and a wealth of cultural and entertainment options.

Just as city and country living appeal differently to different folks, so too do the prospects of investing in such diverse locations.

“Investors looking for city centre properties tend to be those who are keen for long-term returns with lower risk. They’re seeking an established asset class – buy-to-let – which has been around long enough to be proven as a model that generates consistent yields. The solidity of the asset class is paramount, even over and above considerations like the tax relief reductions for landlords, which the government is phasing in from 2017 onwards.”

Oliver Ramsden, Founder and Director, Aspen Woolf

 

As well as buy-to-let investors looking for brand new developments, cities tend to attract those investors who want to take an active role in their property investment. Buying a house and refurbishing it can result in capital gains as well as healthy rental yields and many investors enjoy the buzz of managing their own properties. It can be a competitive occupation, and those at the forefront of the industry are continually seeking new ways to ensure that their properties stand out from the crowd. Engaging professional interior design consultants is the hottest new trend.

“We are working with a growing number of individuals who never imagined they would be employing interior designers to create a beautiful interior for their home. Interior design used to be the preserve of the very wealthy. Now, there’s a growing trend for people at every level of the property ladder to use expert services of this nature.”

Robert Walker, Managing Director, Alexander James Interior Design

 

Those investors who favour properties in the countryside tend to have a different focus than their city investor counterparts. They’re prepared to take on newer and more innovative asset classes in the pursuit of higher returns and lower taxes.

“Hotel investment can generate excellent yields, and buyers are free from the concerns of Stamp Duty Land Tax and the hit to income that void periods can cause. Strong returns and fewer taxes to worry about is an attractive combination. Many countryside investments also come with a personal usage element, meaning that investors essentially get two weeks of free holiday accommodation thrown into the deal each year.”

Jean Liggett, CEO, Properties of the World

The restrictions on tax relief for residential landlords has the potential to mark a step-change in investor preferences. From 2017 to 2018, only 75% of finance costs will be deductible from rental income. The figure will reduce annually, until it reaches 0% for the 2020 to 2021 financial year.

As city centre buy-to-let developments become gradually less profitable for all those other than cash buyers, will former city investors head for the hills? Only time will tell.

 

On the market:

The perfect city investment: Set on the edge of the vibrant Liverpool city centre, the New Eldon Grove offers the perfect balance of past and present comprised of 45 apartments including 1,2 and 3 bedroom units. Carefully designed to preserve the heritage of the site while serving the needs of a new generation, from just £94,950, New Eldon Grove provides investors with an assured 2-year NET rental of 7%. Available through Aspen Woolf.

Escape to the country: In the Valleys of South Wales, lodges and land plots at Afan Valley Adventure Resort allow investors to be part of a thrilling new adventure experience. Lodges are priced from £149,000 and offer 8% NET returns for seven years, with two weeks’ personal usage. Land plots offer a mark-up of 10% per annum for three years, from just £25,000. Both available through Properties of the World.

 

For more information, please contact:

Aspen Woolf: +44 203 176 0060 or www.aspenwoolf.co.uk

Alexander James Interior Design: 020 7887 7604 or www.aji.co.uk

Properties of the World: +44 (0)20 7624 5555 or www.propertiesoftheworld.co.uk