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Post by henders on Nov 26, 2014 9:32:02 GMT
Not P2P related but a prospective investment (maybe?!). I've never invested in property (almost defo a big mistake) apart from family home. Been talking to this outfit ( Select Property ) who have purpose built student accommodation in a number of cities (Exeter, Bristol, Manchester, Sheffield). They guarantee an annual yield for 5 years of 7%+. The outlay is approx £100K for ownership of the apartment. Their developments sell like "hot cakes" and are mostly sold out within a few months (all sales are pretty much off-plan). Anyway link below is their Newcastle brochure that they have sent to me. I'm talking myself out of investing (cos I'm a coward when it comes to property - always fearing a crash etc.) but worth a discussion, I think. www.selectproperty.com/vita-student/vita-student-at-westgate/ |
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Post by jevans4949 on Nov 26, 2014 11:41:19 GMT
Out of my league, but would suggest anybody looking at this should read the small print carefully.
Presumably this is a leasehold type deal. Are you free to sell your investment to a third party, or are there clauses that prevent you from doing so without the co-operation from the owner of the block?
Who manages the letting - you or the management company, and what is their cut?
Are you liable for repairs, etc?
Sounds like it could be as full of pitfalls as park homes or time-shares.
Somebody was trying to sell hotel rooms in London a few years back on a similar basis. Don't know what happened to that.
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Post by henders on Nov 26, 2014 12:35:30 GMT
Just to clarify.
Yes they are leasehold (200 year plus, I think).
Yes you can resell (and according to the company units have sold in some locations with capital appreciation of around 10% per annum).
All ongoing costs (service charge, management and maintenance) are taken out before the 7% yield; so the 7% is net.
The prospective market is largely foreign (typically chinese, japanese etc.) students who want this time of modern well kept living (apparently).
I am trying to dissuade myself from being tempted; but it doesn't look like a bad deal to me.
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shimself
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Post by shimself on Nov 26, 2014 13:47:33 GMT
ask for corroboration about reselling. All reselling, not just the one good one.
Is there some place for their customers to chat amongst each other (like here but different)?
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j
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Post by j on Nov 26, 2014 18:57:39 GMT
Not P2P related but a prospective investment (maybe?!). I've never invested in property (almost defo a big mistake) apart from family home. Been talking to this outfit ( Select Property ) who have purpose built student accommodation in a number of cities (Exeter, Bristol, Manchester, Sheffield). They guarantee an annual yield for 5 years of 7%+. The outlay is approx £100K for ownership of the apartment. Their developments sell like "hot cakes" and are mostly sold out within a few months (all sales are pretty much off-plan). Anyway link below is their Newcastle brochure that they have sent to me. I'm talking myself out of investing (cos I'm a coward when it comes to property - always fearing a crash etc.) but worth a discussion, I think. www.selectproperty.com/vita-student/vita-student-at-westgate/, look at THC, some of their investments, not all, offer 7.5% fixed pa with I think 3 or 5 yr term. Do read their T&Cs though as many of us fell foul of the initial wording on actual returns until it was raised & clarified by them a few months ago. You should not have that issue though if you opt for the fixed income option though. I'm probably a little like you but it is worth having a look if you want to invest a small amount to diversify. GL
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Post by valerieb on Nov 26, 2014 22:32:46 GMT
One of my sons has been talking about investing in student pods. There seem to be a number of such developments across the country with pods/studios starting around £60k and assuring net returns up to 9% p.a.(121move.co.uk list several). Look interesting but we're currently sitting on the fence!
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Vero
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Post by Vero on Nov 26, 2014 23:17:06 GMT
I hear there could be some available in Ipswich pretty soon...
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pikestaff
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Post by pikestaff on Nov 27, 2014 9:46:19 GMT
The yield is "assured" for 5 years, not guaranteed. They are not allowed to say guaranteed. Check the fine print. Who is giving the assurance and what financial backing has it got?
Assurance from the Vita Student alone - bad. They could go bust.
Assurance from the Vita Student backed by credit insurance from a reputable insurance company or a bank - better but you are still at risk if Vita Student go bust because who will manage the property then?
In any event the capital value of your investment is at risk. That's not to say these types of scheme are necessarily a bad idea - they are common enough for hotels and this is just a variant on the theme - but you do need to understand the risks.
This kind of property is pretty specialised. To my mind the main risk is of oversupply in the local student market if there are too many similar developments, exacerbated by uncertainty about future student numbers - including overseas students, who form a significant part of the market for premium accommodation, and who many universities rely on to balance their books. With politicians of all hues hell-bent on cutting immigration, and with further spending cuts looming after the election, I'm not that confident about the long-run prospects for student numbers.
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Post by henders on Nov 28, 2014 8:28:14 GMT
Thanks for your interesting perspectives.
Still wrestling with it.
I try to be really negative and talk myself out of opportunities (and if they still look appealing after this; then I tend to go for them).
I accept many of the potential "pitfalls" outlined here, but the more I research the more it looks like a decent deal.
I believe the company to be sound (trading since 2004 and properties all over the world)
They have an excellent track record in this field.
Premium student accommodation is highly sought after (whole buildings selling out in days/weeks).
I accept the immigration "threat" but foreign (wealthy) students are a significant positive to our economy and it would be madness to clamp down in this area. Also may universities would go bust without this business.
The biggest threat is the uncertainty after 5 years of the ongoing maintenance as there is a leap of faith there but it would be massively damaging to their ongoing business should they choose to "fleece" existing owners that I think it is highly unlikely.
Will be having another discussion with them on Monday.
Still think I'll wimp out in the end and regret it in 5 years. Such is life!!
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