Serviced apartments

alexbray

Hi all,

I've been looking at investing in a serviced apartment and just wondered whether anybody else had any experience of investing in one? With regards to the one I'm looking at I get a guaranteed rental income for the next 7 years and only have to pay ground rent and the service charge. From what I can gather I don't have to pay maintenance charges or anything else. Obviously this sounds way to good to be true so I thought I'd ask here to see if anyone else has taken the plunge.

Thanks!

silvercar

Impossible to mortgage.

Difficult to sell on with no future guaranteed occupancy rates.

alexbray

Yeah like I said, if it sounds too good to be true… :-)

Pete9501

What happens in 7 years time when maintenance is needed and there is no sinking fund to pay for it? Do owners suddenly receive a large bill?

Who manages the service charges and who controls the managing agent to ensure they are constantly seeking value for money not there preferred contractor because it is convenient?

Pete

G_M

I remember reading about scams in this market a while back, but can't remember the details.

The posts above raise good Qs but I'm sure there are other issues.

sniggings

alexbray wrote: »

Hi all,

I've been looking at investing in a serviced apartment and just wondered whether anybody else had any experience of investing in one? With regards to the one I'm looking at I get a guaranteed rental income for the next 7 years and only have to pay ground rent and the service charge. From what I can gather I don't have to pay maintenance charges or anything else. Obviously this sounds way to good to be true so I thought I'd ask here to see if anyone else has taken the plunge.

Thanks!

if it was that easy, why would they let you take all the profit.

eddddy

alexbray wrote: »

Hi all,

I've been looking at investing in a serviced apartment and just wondered whether anybody else had any experience of investing in one?

<snip>

This is an unregulated investment. I would treat this in the same way as if a guy I didn't know said to me in a pub "Do you want to invest £50k (or whatever) in my business idea?"

It could be a great business idea - or the guy could be completely deluded - or he could be a conman.

At the very least, I would want to do a shedload of research about the company, the people involved, the business idea, the other investors, the legal stuff etc.

But TBH - for very many reasons, my instincts would tell me to walk away.

eddddy

... just to add. The hype around these schemes reminds me of the timeshare boom in the 1980s.

People paid £20k, £30k, £40k for timeshares. Now, if you search 'timeshare' on ebay, you'll find many for 10p, 50p and 99p - and nobody wants to buy them.

I suspect that many hotel room investments, student pod investments etc., will end up the same way.

lisyloo

What stands out for my is what sniggings said in post #6.
Q. If it was that good then why isn't the person selling it letting their mum, dad, brother, sister, friends or have it themselves instead?