You Can Be a Property Millionaire in 6 Months - And other Lies

Reality check -you can do well in property if you follow some sound principles but you can’t become a millionaire almost overnight. (Well you can, but you will also have a mortgage for a million pounds too!)
And yet, lots of very expensive seminars tell you it’s possible.
However, the only people getting rich here are the seminar givers themselves - who also make money by selling property, arranging finance and so on, right down the line.
Of the people I know who have been to these expensive property firm seminars, the biggest beef they have – apart from the high fees - was that the property they bought could not be let out for anywhere near the rent the promoters claimed.
In many cases there was no one to rent them to at all.In last weeks’ broadsheet papers, I see lots of journos are writing about overseas property.
Their editors like these stories because it’s a chance to print a pretty picture of a beach somewhere – and the writers like them because the article copy can be cut and pasted from the property developer’s blurb.
But too few of these writers ever have a good look at who is actually going to rent these new builds and for what rent.
As you may know, I try to tell it like it is – which is what I will be doing at my speeches at Olympia tomorrow and the NEC on Friday and Saturday.
Don’t forget also there is my special seminar evening at the Railway Tavern, Liverpool Street. The cost is just £25 - or £20 if you pre-book. All you need to do is email me at david@lettingfocus.comHere are the details of the event – http://www.lettingfocus.co.uk/enews/enews.htmlIt’s easy to find – the pub is in the heart of the city next to Liverpool St station and tube. Just take the Broad Street Exit. The event is being held in the Engine Room function room upstairs.
Copyright: David Lawrenson 2007

What School Catchment Areas, the Lottery and Buy to Let Have In Common

Ah, our lucky neighbours! Some of them anyway. Their kids go to a good school.
Will I be so lucky with our little fellah when he comes to go to secondary. Probably not. As I mentioned in a previous blog, the only good boys’ secondary is now 22 times oversubscribed -the highest in the UK.
A few years ago, that local good school was the first in the UK to introduce a lottery system for half the kids in an apparent bid to stop middle income parents buying properties up on t’hill near the school.
Now Brighton Council and also Herts are planning going to do the same thing. This means you can no longer guarantee your children a place at a good school simply by buying into that school's catchment area.
So, what’s that got to do with property investment and buy to let, you ask?
Well, for a start the existing property price premiums in the catchment areas of good schools is likely to erode. The Royal Institute of Chartered Surveyors (RICS) has calculated the premiums add 8 per cent to a property's value.
But the policy has not been finalised and parents’ who have already bought into a catchment area are threatening legal action.
The current uncertainty over whether the new admissions rules will pass the legal test is an interesting opportunity because if the lottery plans are stopped from going ahead, the premiums for being near a good school will reappear in full. So, this may be an investment opportunity.
The problem is that while the whole lottery plan is still just talk areas near a good school still command a something of a premium (even if the planned lottery may have eroded some of that)
Me, I’ve never won at any kind of lottery, so the move to sunny Hampshire and out of London looks ever more likely.
See also the recent FT article on this http://www.ft.com/cms/s/85c6b064-d41f-11db-83d5-000b5df10621.html Back to main site: www.lettingfocus.com Copyright David Lawrenson 2007

You Can Still Put Buy to Let Property In a SIPP -Part 2: Buy to Let Hotels

My blog on Thursday was about how you can still put residential buy to let property in what’s called a “Syndicated SIPP.”
It attracted a lot of interest.
Now, another type of investment that is still allowed in a SIPP is hotel investments – as these are classed as a commercial property. The likes of Guest Invest and others also allow you to buy a room in a hotel.
If you are thinking of buying an individual room in a hotel look carefully at the schemes charges and the hotel occupancy rate – both now and in the future.
Also, getting a mortgage may be quite a bit harder too.
And just as with the syndicated SIPP the fine print of the HMRC’s rules are devillish and there are many traps to watch out for.
For example, for a hotel room to qualify for inclusion in a SIPP, there must be shared facilities such as a reception area and restaurant. However, if the room itself has a self-contained kitchen, it may be seen by the Revenue as a residential property and thus not allowed in a SIPP.
The Revenue say you are not allowed to stay there yourself - this rule disbarred many of the UK apartment hotel schemes when they were first launched.
So watch out for the rules and talk to a good tax accountant and pension expert (IFA) who fully understand the SIPP rules before you go in for this.
Back to Main Site: www.lettingfocus.com
Copyright: David Lawrenson 19th March 2007