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How To Avoid The Crap - Doin' It For The Kids


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Right,

Instead of dissing everything, especially property, heres a challenge for you lot.

An investment prediction for 2006, 2007, 2008 & 2009.

Regardless of what you lot like to predict I will keep my 5 owned properties but am curious to see what prediction are made for the period.

If problems (social, financial and political) are as bad as predicted on here, then we are all f****d.

£200k invested over the next 4 years. Growth & security.

Theres the challenge.

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Cripes,

Keep property - is that right?

What about the cycles, crashes, impending social disaster............?

Come on folks, if people are so sure of the impending crash then surely there should be equal certainty in other positive investments?

You haven't answered the question - do you own it or are you mortgaged up to the eyeballs ?????

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Right,

Instead of dissing everything, especially property, heres a challenge for you lot.

An investment prediction for 2006, 2007, 2008 & 2009.

Regardless of what you lot like to predict I will keep my 5 owned properties but am curious to see what prediction are made for the period.

If problems (social, financial and political) are as bad as predicted on here, then we are all f****d.

£200k invested over the next 4 years. Growth & security.

Theres the challenge.

5 houses? thats means nothing. What matters is the yield, your leverage, unrealised capital gains tax liability etc. Provide a bit of detail on this and I would be happy to share my views...

200k or 20m it doesnt matter. If I had to pick one asset class it would be equities. The markets may be 75% up since March 03, but they still look better value than bonds at 4-5%, commercial real estate at 6-7% and residential property at 4%.

Here is a question for you. Why do you own residential property? Commercial real estate is far better value on most measures, plus you can own it without any of the hassle via quoted investment vehicles. I work in equities. My largest investment is my shareholding in the company i work for, so to diversify risk, I have a lot of commercial real estate exposure and all via quoted companies or funds. Returns have far exceeded UK residential and yields are still far more attractive.

One asset not to own is gold. What a joke. No yield, rising production. I wouldnt go near it.

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Yield on original purchase price is 15.2%

Leverage is, I assume, 0 based on above.

The thing that baffles me is the fact that I can borrow £100k at £7k per year pro rata no questions or forms asked and make £10 - £20k per deal and even at 2 deals per year that equates to £20 - £40k per annum for a maximum of 20hrs per annum work.

Where can I borrow to invest in stocks, gold or unit trusts?

Any help.

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Yield on original purchase price is 15.2%

Leverage is, I assume, 0 based on above.

The thing that baffles me is the fact that I can borrow £100k at £7k per year pro rata no questions or forms asked and make £10 - £20k per deal and even at 2 deals per year that equates to £20 - £40k per annum for a maximum of 20hrs per annum work.

Where can I borrow to invest in stocks, gold or unit trusts?

Any help.

Yield on original purchase price is irrelevant. I bought BP shares in 1992. Yield on the purchase price is probably 25%. The important thing is what is the yield on the current market value. For BP thats 3% today.

When I asked about leverage you misunderstood me. What i meant was how much debt you have on the portfolio? i.e. what is the loan to value? As you point out, one of the main attractions of real estate is that you can leverage it. No professional investor owns real estate without leverage.

What do you mean when you say you can "borrow 7k and make 10-20k pa". Sounds good to me. please explain. Show me the maths.

It is very easy to borrow against stocks, shares, commercial real estate, gold or any other asset. There are two ways. If you've got a reasonable amount of investments go to any private bank and they will lend up to 50% LTV at 1% over libor. Alternatively, if you are a small time punter, open a spread betting account with IG Index. They let you trade on margin, and its all the same thing.

So back to my question. Why houses and not commercial real estate? It wins every way versus residential.

You asked for advice, and that is what I have given. Maybe you only came on this site to boast that I own 5 houses while most of you cant afford one? Lets try to answer my questions...

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If you own 5 outright then surely its entirely up to you what you do with them. You might consdider doing nothing and collecting your rent - if your rent income is no good at the moment then you might consider selling a single house as a tie over for when you can get better incomes. If your making nuff money on the 5 you have then stay still. If you dont think the market will ever recover then sell the lot and live happily ever after.

Entirely up to you, the nuBTL who jumped on the wagon the past couple of years, who have built thier property empires on a pyramid structure, who are mortgaged to the eyeballs, whos rents dont cover the interest on thier investment should be concerned.

Personally if i owned 5 outright then i wouldnt even be posting on a internet forum, i'd just be doing my thing. I get the impression that your just here for abit of ftb'r baiting, again thats entirely up to you im sure someone will bite at some point.

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Right,

Instead of dissing everything, especially property, heres a challenge for you lot.

An investment prediction for 2006, 2007, 2008 & 2009.

Regardless of what you lot like to predict I will keep my 5 owned properties but am curious to see what prediction are made for the period.

If problems (social, financial and political) are as bad as predicted on here, then we are all f****d.

£200k invested over the next 4 years. Growth & security.

Theres the challenge.

You haven't said anything about who you are or what you do, only about what you have and how you want more. If you already own five houses your kids are presumably already secure.

If you want growth and security, how about giving up your job, selling one of your houses, and go and do VSO work somewhere in the third world and get some idea how the rest of the world lives? Why not do what you've always wanted to do - read, study, paint, sculpt, ride a horse, or whatever? That way you'll get the growth, as you'll probably grow enormously in a personal sense, and you won't have that "if only I hadn't spent so much time at the office I could have..." feeling. You'll have the security of laying down memories you'll never forget, experiences you can cherish when you're reclining in the old Parker-Knoll with a dry sherry in old age. Rather than reminiscing about that amazing Excel spreadsheet you turned out in '05 for the company budget, the one with the pivot table and the colour-coded departmental bar charts.

Now look at it slightly differently. The more people like you ratchet up the rat-race by pursuing wealth in terms of cash, shares, property, etc, the faster the hamster wheel spins for the next generation. So your actions will make it worse for your kids and, for that matter, for everybody else's. The crap is made by people pursuing the goals you're pursuing.

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Right,

Instead of dissing everything, especially property, heres a challenge for you lot.

An investment prediction for 2006, 2007, 2008 & 2009.

Regardless of what you lot like to predict I will keep my 5 owned properties but am curious to see what prediction are made for the period.

If problems (social, financial and political) are as bad as predicted on here, then we are all f****d.

£200k invested over the next 4 years. Growth & security.

Theres the challenge.

There is no challenge because you have missed the major point - Global Banking - Media control/Market fixing/Interest rate fixing/Manufacture/Transfer of Wealth.

We are in an unprecedented age of blatent Global control.

Those who control it can destroy economies at will and transfer jobs and manufacturing to bankrupt Nations. Trying to predict their next move is almost impossible.

As they are fanatically fixated by Astrological (but then so are Billions of Chinese, Indians) and planetary events, expect weird occurences (in Markets/financial/Govt announcements) when these events are predicted to happen!

My prediction - they will ruin the 'property owning' classes in one form or another within the next decade! Taxation, crazy housing 'rules' driving out or bankrupting landlords etc

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I can borrow £100k at £7k per year pro rata no questions or forms asked and make £10 - £20k per deal and even at 2 deals per year that equates to £20 - £40k per annum for a maximum of 20hrs per annum work.

What kind of "deals" are these? Buy-to-sell? Buy-to-let? Where is this £20-40K income coming from (in your scenario)? Rent? Capital gains? Your descriptions are so vague as to be practically meaningless.

Where can I borrow to invest in stocks, gold or unit trusts?

Spreadbets, CFDs, warrants and options give you leverage on the above instruments, which gives you pretty much the same effect as borrowing (ie magnifying your returns).

My money for the next 5 years would be in oil and natural gas, mostly upstream investments.

Edited by IPOD
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