Posts

Showing posts from March, 2017

Thinking of diversifying into Commercial Property in Clapham?

Image
Adding value is key in property investing. Following this ethos investors are now moving from comparatively expensive residential property to commercial property. There is relative ease in adding value as there is less competition. They can buy cheaper for starters...

Crescent House SW4. This old office block was bought for £4 million in Feb 2012 and resold for OIEO £13 million two years later when PD came into force. 38 units will be built and a quick count on their website tells me phase 1 (13 units) is selling at a total GDVof £12.5million.
But I don't want to rent out an office block, you say? You're right, there's less yield in straightforward buying of an office block and filling it with commercial tenants. There's a lot of uses for commercial property, and a lot of types; let me discuss a few and it may get your juices flowing.
Types of property A commercial property could be anything, from shops (with flats above) to purpose-built office blocks, gyms, churches, …

Yields are attractive in South London - if you invest right!

Image
I'm hearing a lot of my investor clients say "I'm thinking of investing my money up North for better yields." I think it's an interesting point of view of course, basing your investing mindset on a gross figure. It is true, of course, that there is an inverse relationship between gross yield and capital growth. Often times investors that are new to me me have been used to very little cash flow and, as often with period property, spates of repairs further eating into their rental profits. So, they've got masses of equity tied up in these properties and no way forward. They think that buying with gross yield in mind is the way forward.
What can I do? If you, like most of my new clients, are stuck with lots of equity and little option to release it for further investment, then it's time to review your portfolio. What can you do to enhance the cash flow? I had a call from a fellow investor who had several properties geared at only 30%! He was very astute and …

5 helpful tips on getting the best out of your refurbishment in Clapham

Image
Any astute investor will know that one of the ways to make a profit from property is to add value by improving the property. Often times investors will look to significantly improve the property before they offer it back to the market for rent. After all, there should be some "sweat money" factored into the purchase price. So if you are buying right a £400,000 should be worth significantly more than £420,000 if you are looking to spend £20,000 on improvements.
So here's 5 improvements that will add the most value to your next refurbishment (weigh up the costs vs the extra you will achieve in rent though, each project is different):
1. Redecoration - nobody wants a tired looking property. The attraction of shiny new builds is real for tenants. The kitchens, bathrooms and all the finishes are brand new. They however do not present the best investments for landlords. If you are looking for better returns a simple coat of paint with perhaps a feature wall thrown in will wor…

5, no, LOTS of Reasons why you should NOT let your property in Clapham using Gumtree

Image
Honestly I could write a book about this. Time and time again through my agency career I would have landlords calling me, desperate for advice after they've placed a "lovely" tenant in their property using a free (or low costs) DIY advertising website. The tenant presented themselves as honest, open, and above all very capable of paying the rent.
But the truth is a different matter. They got into the property by deception, and ended up costing these landlords thousands of pounds in damages, unpaid rent, and above all stress. These landlords had to cover the mortgage whilst funding the legal battle. One made very difficult because they weren't aware of all the legislation surrounding lettings. This could prejudice their position in court. Didn't serve the Prescribed Information? Didn't register the deposit within 30 days? That means the tenant could actually sue YOU for 3 times the deposit amount! And there's more...
It has been said that some 30% of the …

Rents are set to rocket in Clapham - are yours?

Image
The title will have many investors licking their lips with joy of course. Rents on the up, lovely. Mortgage rates at an all time low, excellent - all ingredients for a nice slice of profit pie. Let's take a moment though and analyse the why, how and what effect this will have on the medium to long term future. Don't worry, on the whole it's good!

The Royal Institute of Chartered Surveyors (RICS) reckons that rents will rise 20% over the next five years (source: Landlord Today). That's not actually that much I believe, some 3.7ish% compounded. That's really low in my opinion. But I'm a London investor and my clients are London based. The RICS also reckons that property prices will rise 18% over the next five years. If you are reading this and you know anything about the property market within the M25 you will laugh. Fact of the matter is that it is very well possible to get gains like that in 2 years! So why the "pessimistic" statement from RICS? Well…

5 reasons why the phrase BMV is a complete and utter farce

Image
There, I've said it. I absolutely hate the phrase "below market value," or BMV. Hate is a strong word, but there is simply no other way I can describe my feelings. BMV does not exist. It is merely a throwaway phrase to describe "a good deal." Let's delve further into this...


So what is BMV? As the phrase indicates it is a purchase price lower than what you would normally expect to pay for a property. So if all the flats on Clapham Road with two bedrooms and approximately 600sqft are £550,000 and this particular seller sells at £440,000 you will be buying at 20% below market value.
Why? Yes, indeed, why on this green Earth would someone give you £110,000 off simply because you can complete quickly, or act confidentially, or any other rubbish that the "gurus" spout that will help you convince sellers to sell cheap? In a market such as London one merely has to drop the price a smidgeon to get interest. And don't tout the old "it was £550,000 …

Build to rent in Clapham?

Image
Thank you all very much for joining us back at the Jam Tree for another great evening of networking and learning from true property professionals.
Martin Smedley gave us valuable insight into the world of commercial property finance, Trevor Cutmore updated us on the latest market trends and I told our guests more details on my projects and how to generate 20% returns in Zones 2 and 3 in London!








For next month we have Lloyd Girardi joining us and telling us about his Build to Rent strategy. You'll know I'm a very big fan of passive income so I hope that you can come enjoy his talk, I'm sure I will!
Lloyd Girardi & Andi Cooke started property investing through developments. In less than 3 years they have built up a portfolio of 42 properties using none of their own money. They have raised to date around £7m of joint venture finance and have done 100% funded developments AND after paying the investors off, they have maintained the properties as their portfolio generating a g…

Maybe Airbnb isn't the way forward for your rental, be it in Clapham or elsewhere...

Image
Let me start this article by saying that I admire entrepreneurial spirit. Naturally maximising return on your investment should certainly be applauded. Things that are, however, high on my agenda are sustainability and longevity when it comes to property investment. Oh, and I like passive income...


So with that in mind, let's delve deeper into the phenomenon of Airbnb.
What is it? In case you didn't know, it's essentially a property website for tourists that matches would be hotel guests to property owners that are in the position to rent out a room, or even the whole property for a "short let." So anything from a night to say... 365 nights.
Why Airbnb? Well simply put, a property is worth more by the night than it is by the week/month/year. A bit like a hotel. For £150-200 a night you can book a room at the Ritz, but you can also rent a swanky 2 bedroom 2 bathroom penthouse with some river views. Self-catering mostly, but there is something awesome about staying …