Tag Archives: property investment

The world of UK investment, business and economics

So what’s going on in the world of UK investment, business and  economics?

UK Investment
Did you know UK investment is at a record high? Very little spread online about this. The ONS quietly released the latest figures for Gross Fixed Capital Formation (GFCF) which covers investment across the whole economy, public and private sectors, manufacturing, construction, services and extractive industries. investment grew by 1.1 per cent in the fourth quarter of 2017, to a total of £84.1 billion. This is contrary to the headlines and beliefs that investors have fled the UK following Brexit. It’s not received a lot of news but the FT (https://www.ft.com/) were one media platform that did report it. It would be extremely helpful to all concerned if the public could be fed less propagandist speculation about the future direction of UK investment and the economy, made by organisations which have already been embarrassed by the grim forecasts they made ahead of the referendum, and we got to hear rather more genuine economic news. The way forward with a balanced view.

UK Property
Punitive tax reforms, including the removal of mortgage interest relief, extra stamp duty and tighter rules around mortgage borrowing, are helping to drive landlords to exit the buy-to-let market in droves. We at Barrington Howe have noticed this trend with the number of investors looking to sell properties and invest with a hands off approach. See our buy to let guide http://bit.ly/buytoletguide. Many clients have opted for hands free higher yields with security with our UK investment products Empire Property and Godwin Developments. According to estate agent Savills, buy-to-let lending collapsed by 26pc last year, as diminished profit margins discouraged new investors from adding to their portfolios. According to research by comparison website TotallyMoney, which looked at 580,000 properties across England, Scotland, and Wales to find the areas that offer the highest buy-to-let yields, Liverpool was the most profitable locations for landlords.

UK Economy
UK Prime Minister Teresa May hints at increased taxes to fund the NHS. £20bn will be made available to the NHS over the next 5 years. How is that going to be paid? She has mentioned the public will pay. The Brexit “withdrawal bill” headed back to the House of Lords with a ‘Meaningful vote’ high on the agenda. The Government lost another vote meaning that there will be another vote in the House of Commons on Wednesday. MP’s will voting on an amendment that would give politician a “meaningful vote” on Brexit. This will mean if 21st January passes with no deal being struck Parliament should intervene to prevent the UK from “crashing out” of the EU without a deal.

Overnight, a risk off tone was maintained in the market overnight as concerns surrounding trade wars remain. The White House confirmed yesterday that the US will impose tariffs on an additional $200bn worth of Chinese goods. If we see China retaliates then it will escalate tensions further which could hinder global growth and confidence.

Later in the day, ECB President Draghi is due to speak at the ECB Forum on Central Banking. After his dovish comments last week, the market will be keen to see if he elaborates further. Looking at economic data, we are due to see the housing starts and building permits.

Germany
It is reported that the most new born babies have been born since 1997! The numbers have risen significantly for the fifth consecutive year according to the federal statistics office. So what does this mean? A major reason is the lack of affordable housing as well as not enough child care facilities!

The economic growth rate for Germany has been reduced to 2.1% slightly lower than expected. Dolphin Trust continues to go from strength to strength with further developments taking place in high growth areas in Germany. Germany still remain with a budget surplus over 36.6 billion euros! There still remains a sustainable upswing on German real estate markets thanks to the economic boom.

Whilst news is the usual up and down, our clients profits remain on the up. The average return based on client UK investment for 2018 to date is 12%.

Empire property holdings update

Empire Property Holdings May Update

Empire Property Holdings Update

Empire Property Holdings is an investment opportunity providing a fixed return for up to 4 years at 15% pa. This update is to show you the ongoing developments of the company and how their business model allows for an above average yield for an investor. Empire are developing a number of buildings not just one. To ensure that clients and potential clients can obtain as much transparency from this investment we would like to show you the latest updated photographs from the sites acquired. Empire Property Holdings have been very busy over the last 19 months. With a few developments near to completion, it would be a great time for you to see what they have been up to.

Empire Property Holdings are not just developers but they are investors too.  They have refinanced the majority of the developments they have created to keep in their portfolio. The New Commerce House refinance has recently been completed. Following this successful refinancing, Empire Property Holdings acquired Newspaper House in Blackburn with plans in place to develop 66 apartments.

Newspaper House, Blackburn

Empire Property Holdings have completed the acquisition of Newspaper House in Blackburn.  A planning application has been submitted to build 66 flats with car parking with an extremely positive response.

  • £850,000 Purchase price
  • £2,640,000 Development Costs (£40,000 per unit x 66)
  • £3,490,000 Total Cost
  • £429,000 Income (66 units x £125 per week x 52 weeks)

A benefit to the site is a rear warehouse which has been leased back to the Lancashire Telegraph for 12 months.

The development is near to completions with some of the apartments partially let. And this is even before completion showing the demand for the units.  The remaining work is the lift refurbishment, which is due to be completed within the next month. Some of the external fascia has been modernised to give a fresh modern appeal to the building.

This development is ready to be refinanced at the end of May. In tune with the business model it will then allow Empire Property Holdings to acquire the Thornhill Street site. Buy, develop, refinance repeat!

Thornhill Street, Wakefield

On the refinancing of King Charles House, Empire will purchase the Thornhill Street site which has the benefit of full planning consent to change the current use to C3 apartments.

  • £850,000 Purchase price
  • £480,000 Development costs (16 units x £30,000)
  • £1,330,000 Total Costs
  • £112,320 Income (16 units x £135 per week x 52 weeks)
  • £50,000 Further Commercial Income
  • £162,320 Total income

Thornhill Street

Globe Works, Bolton

Empire Property Holdings have purchased another site as part of their property loan note investment. Globe Works a former town centre mill in Bolton on acquired on 3rd May 2017.

A former mill to residential conversion via full planning permission, which will create 24 one bedroom, 90 two bedroom & 10 three bedroom apartments.

  • £1,700,000 – Purchase Price
  • £6,200,000 – Development Cost (124 units x £50K)
  • £7,900,000 – Total Cost
  • £1,024,800 – Income (24 1 beds x £600 x 12) (90 2 beds x £700 x 12) (10  3 beds x £800 x 12)
  • £12,800,000 – Valuation based on 8% yield
  • £8,960,000 – Refinance exit (70% LTV)

 

Globe Works Bolton

Globe Works Bolton

Globe Works Bolton

The Investment Opportunity

2 Year Income
Year 1: Interest at 10% p.a. payable every 6 months.
Year 2: Interest at 12% p.a. payable every 6 months
Total Interest 22%

2 Year Growth
Year 1: Interest at 10% p.a.
Year 2 (compounded) Interest calculated at 12% p.a.
4% bonus
Total Interest 27.2%

4 Year Growth
Years 1-4: Interest at a total 60%
Total Interest 60%

For further information contact us on 0203 026 8820 or register your interest HERE

uk property market

UK Property Market: How is it doing now?

There’s been lots of uncertainty and apprehension for the UK and specifically the UK property market since Brexit. But some interesting data has been found. THE average UK house price has climbed by £17,000 in a year, continuing a “strong” run of growth, according to an official report. The typical property value was around £217,000 in July, marking an 8.3% year-on-year increase, according to the Office for National Statistics (ONS).

Notably property values have also increased by £1,000 compared with the previous month. While the 8.3% rate of annual growth is a slowdown compared to a rate of 9.7% recorded in June, it continues “the strong growth seen since the end of 2013”, the report said. Property prices are regional. The average house price in England now stands at £233,000, while in Wales it is £145,000, Scotland £144,000 and in Northern Ireland it’s £123,000.

Across the regions of England, London understandably continues to have the highest average house price at £485,000, followed by the South East and the East of England, where house prices stand at £313,000 and £274,000 respectively. The lowest average price continues to be in the North East at £130,000.

Post Brexit the UK Property Market seems to be doing OK to say the least. In fact it’s very encouraging news. This is a great boost for our London Property Bond which continues to be a success. maintaining a strong level of equity and security for investors. Although the pound has weakened it has proved a huge motivation for overseas investment into areas such as London. The Chinese are seeing a 15% improvement on the exchange rate.

Property Hotspot

Want to know the best Property Hotspots?

As investors we are always on the look out for the next property hotspot. But would you have guessed on Bristol being the number one UK property hotspot? In fact, the number of homes sold in the Bristol postcode surrounding Avonmouth nearly doubled in 2014 from the previous year. Are Britain’s latest property hotspots developing into regional house-price bubbles? Well it is looking that way. Avonmouth, next to the Royal Edward Docks (a vibrant area that has benefited from extensive regeneration) was the district with the biggest increase in transactions last year, as sales jumped 94.5pc in 2014, according to new analysis from property agents Hamptons International.

The number of sales rocketed 128 to 249 over the year and house prices grew 21.1pc, double the rate of the national average. In the Hamptons 2014 index of British postcodes by transaction volumes, neighbouring Redcliffe in Bristol city centre came second with sales up 93.2pc last year. It’s all about Bristol!

There has been a huge growing demand to live in and around Bristol. So what are the reasons for this desire to live in Bristol? Maybe because it’s one of the UK’s leading tech scenes. Possibly the relatively large number of new-build developments and high use of the Government’s Help to Buy scheme. For investors, Bristol could be the place for capital growth.

Other UK property hotspots measured by the rise in the number of property sales, included Langdon Hills in Basildon, Essex, which came third in the ranking. Parts of Leicestershire, Cambridgeshire and North Dorset also recorded huge increases in transaction levels. Cardiff also featured in the top ten UK property hotspots, which only studied postcode districts in which there were more than 100 sales in 2013.

Focusing on areas in and around London, Greenwich, Croydon and Dartford all reported an increase in sales too, landing in the top 20 areas by increase in home sales in 2014.

With the extortionate high prices of central London property, these boroughs on the outskirts of London have benefited from those moving out from the centre. High prices for zones one to three for London transport could also be a major factor for first-time buyers buying in Croydon rather than Clapham.

Buy To Let Property By Barrington Howe

Buy to let property on the increase

Buy to let property Investors on the increase! After the last property market crash it seems that the property investor is on the rise again. The number of buy to let property investors in the UK has reached 1.6 million in 2014 according to Her Majesty’s Revenue and Customs (HMRC). This represents an increase of 120,000 from the previous year.

After looking into various sectors of property investment, research found that student property was considered the best and most popular investment opportunity. Approximately 1 in 8 claimed that should they choose to invest, their preference of choice would be in student accommodation. 10 per cent would choose to invest in retirement property, whilst 9 per cent preferred holiday homes. However, this research did not take into account alternative investment or fixed rate investments where the investor did not own the asset. Having raised millions in fixed rate property investments over the years, we can see that there is an increase in property investments as a whole not just in the buy to let sector. Confidence is increasing over time.

However, despite the growing numbers reported by HMRC, certain concerns have been identified, with 36 per cent of UK adults stating that it is too risky to be a buy to let property landlord. Confidence in property investment was also shown to vary across the UK. The highest percentage of investors believing the market will boom was from London at 39 per cent. The next highest was West Midlands with 38 per cent. However, optimism was much lower from those surveyed from the North East and the East Midlands. They showed only 21 and 26 per cent respectively believing that the market will continue to grow. The proportion of optimism seemed to be lowering the further you travel up the country.