__dazzler__

Thanks - and I'm complete agreement with you. The initial yield on the purchase is actually in the region of 6%pa of purchase price (inc management fees) so I'm guessing this is a fairly decent return for a city centre appt. It would cover the mortgage and then some, so I'm not too worried. On the capital gains front, I'm certainly not expecting to make a lot between the equity I've bought into and the sell price in the next couple of years....but I'd always treat property the same as stock and not buy into anything that I couldn't afford to keep hold of for a while. There's definitely more than a sign that prices are falling....I've certainly lost money in the last 2 years (which now appears to have stabilised, and dare I say started increasing again based on the last sale), although I'm still fairly convinced that if you look at everything in a 7-10 year timeframe and you don't put your **** too much on the line there's not a lot to worry about. The 'Post-Apocalyptic' ambience is also something I can very much relate to! Having lived in a Linden new-build (after being assured a fence would be erected between the development and the Housing Association properties) and seen things go from bad to worse in a short space of time it's something I'm very wary of. After putting the ASBO line on speed-dial things improved slightly, but I'm amazed at the amount of new developments that lack security and CCTV. I believe that the social housing within the development was placed seperate of Charter House (at the side of the cinema), and the parking is secure so I'm hoping for the best! Have learnt the hard way that the Ground Floor is bad news...after losing several Sky dishes and woken up with various adornments on the balcony......:-( On the other issues side I can only verify the info I have on my unit, but as the buildings insurance is now fixed and Persimmon/NHBC appear to be doing a decent job, I'm guessing the others are going the same way. ...and thanks for your advice!

Sorry chaps - wasn't frightened away....have just got out of hospital and still recovering from a near-drowning incident caused by poor window-seals! I did a fair amount of research before signing my life away....and was just using Telephone House as a comparison for a new-build. With regard to 10% return being a poor investment for a rental.....this is a 10% return just on rent v costs and doesn't take into account long-term inflation. Take your pick of any city-centre appt in Southampton and it's likely to be lower, or indeed negative! I'm not saying it's the best investment in the world....but the main purpose of this one is to be my home, and allow me to rent it and accrue long-term capital gain without costing me anything if I go and work overseas in the near future. To clarify on the other comments: Was taking mngt fees and £100 a month to cover ad fees etc into account (although I have no intention of letting this one at the moment, it's nice to know it'd pay for itself) The management fees for the block were projected at almost £2k per unit for the year due to the insurance issues, but £700 has just been credited back after the revised costs after this was sorted. Approx costs for next year should be ~£1100K...which is fine for me (Imperial Appts over the road is >£2.1k per year....but obviously a lot prettier!) On the problems, after having several surveys I'm well aware of exactly what the problems were/are and what's being done to resolve....I can't really say any more than that! If there's no condensation between the panes, the brick-work is sound, there's a dribble of water coming through a gap between a window and a stained carpet below it....I think we'd all agree it probably is a window seal! I mentioned that wasn't the only issue...and had the balcony metalwork removed and a new membrane fitted below it last week under the NHBC. There is a remaining guarantee, the builder has admitted liability and employed a team full-time to resolve any problems....which mainly do revolve around poor window installation due to a cow-boy contractor (as the roof/plumbing issues were all fixed a while back). Provided this is taken into account during the purchase decision and seriously reflected in the price, I'm really not too worried. Had I bought new, suffered a deflation on the value of the property and had to wait several years for it to be resolved then I'd be upset! The major drop in prices at Charter House is/was due to build faults and insurance issues....the second of these is solved and the first is 80% of the way there, with acceptance of liability and ongoing work to resolve the remaining problems. In many respects I agree with the 'doom and gloom' view and the 'standard 2 bed flat' situation in Southampton City Centre has spiralled out of control, hence the correction in prices over the last two years. One of my flats just outside the city centre was ~£190k just over two years ago and an equivalent went recently for £165. Supply and demand rules, and on a new average sized 2 bed flat the current pricing is going to leave a lot of people disappointed when they go to sell. Taking the correction over the last 2-3 years into account, and as long as you don't go new-build at a vastly inflated price, there's still reasonable investments to be made....but mainly in either 3 bed in the city, or something a lot larger just outside. Anyone trying to make a fortune overnight by buying flats is going to have a very difficult job....but as long as you could survive 7% interest rates, buy something a bit different to the norm and look at it as a long term investment then I don't think you're not necessarily going to go bankrupt...... On bog-standard 2 bed 'luxury' city-centre appartments....I'm definitely with everyone on the bear front....and it'll be very interesting to look back on this thread in a year or two's time and see how things have panned out!

Sorry that was confusing....rental income >110% vs mortgage interest...whereas Telephone House/Oceana coming in around 70% based on current prices...ie. BTL would bring in 30% less revenue than you were paying out on mortgage interest. Charter House decline down to build issues and insurance 'dodginess'. Management fees for this year were ~£2k due to the problems and no guarantee of buildings insurance....all now fixed, and letter from management company since the one quoted in which insurance has been acquired at 20% less than last year, rather than the 100% hike that was budgeted for in this years management fees. After having three seperate surveys done, it is (basically) poor seal installation....a couple of parts need fabricating and powder coating to match the delicious shade of blue, a new membrane is being installed below a balcony and...that's it! The previous problems with the roof and plumbing were all resolved by NHBC, hence the reduced insurance quote....and Zurich obviously performed full survey of the building to ensure everything was sorted.

Quick update on the situation at Charter House: Management company now being taken over by residents NHBC have assumed all responsibility, along with Persimmon, for build problems and are on-site fixing them All issues to be resolved within 2-3 months Insurance renewal has now taken place...and is over 20% cheaper than it was for 2005/6, very much conflicting with the correspondence from CPM! The letter quoted was a case of the management company attempting to shift blame...when the main issue was actually caused by them claiming from the insurer rather than NHBC. I've just bought a unit there that was the steal of the century because of potential buyers getting spooked by iffy window-seals (put in by a company that's now bankrupt!) and a drainage problem because the balcony tiling wasn't angled to allow run-off. The building is rather 'Blue'(!), but considering an appartment around half the size (with one less bedroom) at Telephone House would have cost £80k more then it's a no-brainer. New-builds are still being snapped up for BTL which, at current interest rates, will leave give rental income around 70% of mortgage payments (based on 90% LTV) in Oceana Boulevard and Telephone House. Combine this with the fact that they'll all be second hand in two years....and the 110% rental return (at current prices) for Charter House makes a lot of sense...especially when you consider the cost per sq ft is ~40% lower! ....and before asks....no, I'm not desperately trying to sell a 'damp, squalid little flat' here