Investors Only Marketed Properties

The_Fat_el_Hombre

There's a flat I've seen on rightmove and recently it's listing added text along the lines of "Investment offers only". Why is this? Why would someone suddenly not consider offers from first time buyers (amd anyone else)? Is it just because they want all of the cash straight away? Surely the couple of months it takes for them to receive the money from a bank via a mortgage isn't worth not entertaining any offers from people looking to live there?

drdpj

More than likely not mortgageable for one reason or another.

barginboyrob

Might have subsistence problem and therefore no one can get a mortgage on it ?

TonicBristol

I'm also a first time buyer and the ones I've encountered have been flats where the lease only has a few years left to run. It is annoying to see somewhere that seems perfect, but then realise it's only open to investors.

davidmcn

In my experience "investment only" means it comes with tenants in place, rather than vacant possession. "Cash purchasers only" is the code for unmortgageable. But in either case not for FTBs to bother considering.

eddddy

You could phone the EA and ask why they are "investors only" - I'm pretty sure they would tell you straight away.

Although, davidmcn's assessment sounds about right.

It wont be some kind of favouritism or discrimination by the sellers. I'm sure the sellers would love to be able to sell to FTBs needing mortgages etc, at a higher price.

In fact, the EAs are saving you wasted effort in pursuing properties which wont be suitable for you.

The_Fat_el_Hombre

I really hadn't thought it could be any of these things, thanks for the responses.

Putting things to perspective a little - the flat I'm referring to is in Manchester where the rental market is booming. there are lots of new builds that are going on rightmove as "investment only". The flat has pictures of it on rightmove and it looks like it's in good condition, so I doubt it's down to it being not mortgageable. I'm interested in other views on this, but at this stag I think that davidmcn might be right with his suggestion. If it were to be the case could we assume that the seller will be happy with offers from a FTB like me, and I'd have to wait until the tenant moves out? If so then this would be good news for me as I thought all "investor only" properties wouldn't consider an offer from me (I'd based this opinion on flats I'd seen on rightmove for "investors only" that haven't been built yet (some/all of which seem to have management companies in place already)

So does "investors only" not really mean what I initially thought (basically cash buyers) and it is in fact a much looser term and can cover normal FTB's who might just have to wait a bit before moving in? If so is there anything else that it might cover?

eddddy

The_Fat_el_Hombre wrote: »

...
So does "investors only" not really mean what I initially thought (basically cash buyers) and it is in fact a much looser term and can cover normal FTB's who might just have to wait a bit before moving in? If so is there anything else that it might cover?

Not if you need a mortgage. You wont get a residential mortgage on a property that has a tenant in.

But... I suspect your assumptions may not be correct anyway. Otherwise, why wouldn't the sellers just wait until the tenants move out and sell them for more money.

Can you post links to any of the properties you are talking about?

(I'm wondering if they are part of some "investment scheme".)

davidmcn

The_Fat_el_Hombre wrote: »

If it were to be the case could we assume that the seller will be happy with offers from a FTB like me, and I'd have to wait until the tenant moves out?

No, it's safer to assume that they want a quick sale, not the hassle of waiting until the end of the tenancy and risk that you then don't complete the purchase.

The_Fat_el_Hombre

eddddy wrote: »

Not if you need a mortgage. You wont get a residential mortgage on a property that has a tenant in.

I see. So if it's got a tenant in then only a cash buyer will be able to buy the place? This would narrow my options slightly unfortunately

eddddy wrote: »

But... I suspect your assumptions may not be correct anyway. Otherwise, why wouldn't the sellers just wait until the tenants move out and sell them for more money.

Why would they get more money? I suspect there's a very obvious answer but as I am very new to this I'm afraid you might have to spell it out to me in this instance!

eddddy wrote: »

Can you post links to any of the properties you are talking about?

(I'm wondering if they are part of some "investment scheme".)

Can I post links (read on another thread that people can't)?

No I don't think this one is part of an investment scheme - which is what I think I touched upon when I mentioned those with management companies already in place? Are all new build flats "investor only" marketed as yielding certain percentage returns basically investment schemes btw or might you still be able to buy one to live in?

eddddy

The_Fat_el_Hombre wrote: »

....
Why would they get more money? I suspect there's a very obvious answer but as I am very new to this I'm afraid you might have to spell it out to me in this instance!
...

It's just down to supply and demand... Assume there are 3 similar flats for sale:

Flat A is unmortgageable (for some reason)
Flat B has a tenant
Flat C is mortgageable and empty


Regarding, Flat A - relatively few people have a big chunk of cash (say £100k) available to buy this flat.

Regarding Flat B - relatively few people want to buy a flat with a tenant.

Regarding Flat C - relatively lots of people want a mortgageable empty flat, so they can live in it (i.e. people like you.)

So the higher demand for Flat C makes it more expensive.

The_Fat_el_Hombre wrote: »

---
No I don't think this one is part of an investment scheme - which is what I think I touched upon when I mentioned those with management companies already in place? Are all new build flats "investor only" marketed as yielding certain percentage returns basically investment schemes btw or might you still be able to buy one to live in?
...

The schemes I'm talking about are essentially where people invest money in businesses that rent out property. I suspect investors would not be given the option to live in a property.

(The schemes and legalities are complex, and should only be considered by very sophisticated investors - in my opinion.)

At first glance, these look like they may be examples of this:

http://www.rightmove.co.uk/property-for-sale/property-45358163.html
http://www.rightmove.co.uk/new-homes-for-sale/property-26364279.html