We are constantly asked to assist with clients who are keen to build up portfolios but perhaps do not have much time to check individual emails and each property detail – and we know there can be a lot of opportunities to go through!
For this reason we offer a
Portfolio Building Programme
, where we can have an initial free Consultation with investors to discuss their individual needs and then aim to source properties in areas we buy in ourselves that we feel will match those needs.
A typical property and figures will look like this:
Valuation £80,000 (backed by comparables or full RICS valuation)
Purchase price property is secured at: £64,000 (20% discount)
So on average you would invest around £19,500 and on day one you would have an extra £16,000 of equity ie £32,000 of equity for your investment – or a ROI of 64% the day you pick up the keys!
Ongoing estimated costs/profit per month:
Average rent - £450
Mortgage – based on 5% interest only at 75% LTV - £200
Management at 10% of rent - £45
Landlord insurance - £15
Overall - £190 per month
We would aim, based on 5% interest and 75% LTV to ensure you get £150 net profit based on the above assumptions.
So an extra £1800 per annum – based on your initial £19,500 investment, this is a 9.2% ROI per annum.
So not only will you see a huge instant ROI based on the huge equity you secure due to our buying power, you will also see an excellent ongoing passive ROI far higher than would get leaving the money sat in the bank.
The Power of Leverage
It gets better though.
Owning property at good leverage ie sensible borrowing against the value – so around 75% here, allows you to see great ROI over a 10 year period.
In basic terms if you buy a property worth £100,000 for £100,000 cash, and in 1 year it goes up in value to £110,000 – then the return on investment is 10%.
If you buy with 25% of your own money and 75% of the banks ie you invest £25,000 here, and at year end the property is still worth £110,000 what is your ROI? Well this time you have invested a quarter of the amount and still seen a £10,000 uplift. So this time your ROI is 40% - pretty powerful eh?
Over 10 years this compounds up to give you some phenomenal returns – and ensure a very healthy financial future.
So for those clients looking to build a sensibly leverage portfolio giving them phenomenal returns over a 10 year period, based on the above figures, get in touch.
Who will this suit?
Clients with minimum £40,000 liquid funds
Clients with good credit
Clients keen to invest in areas we invest in (where house prices are no more than 4 times the average salaries)
Clients looking for instant ROI of 50% on their investment
Clients looking for passive income of approx 7% per annum
You will be assigned a Portfolio Development Manager who will start the ball rolling, and after the initial discussion, set a clear strategy for you both to work closely together on.
You will get access to our Power team – namely our top mortgage brokers, lawyers, management agents and preferred rates of landlord insurance, and one of our Client Service Managers in our team in Nottingham will keep you updated throughout the buying process.
We currently have over 30 clients on this Programme – some buying 2-3 properties, some buying as many as 20 over 18 months.
Don’t put this opportunity off any longer – investing in 2012 offers massive opportunity, and allows you to secure your financial future - simply enter your details below and one of our Portfolio Managers will be in touch with further details.