Property investment in Liverpool

Ibsin

Hi
This is my first thread in this useful website.
I came a cross a company in North of England who claim that their new build property will yield 7% return.
The property is going to be in modern skyscraper building in City centre we are looking to by a one bed flat in the range of £140k initial payment of £40k then the final payment end of December 2020 this will suit our budget.
We were told rent in Liverpool City center is around £900 a month and there is always demand for such new build.
Some of the questions we are asking : is this rent value correct? Does the demand for rent is high in the area? Does £140k is the actual price for such new build? And I'm not sure what other cost that new build may incur including concierge and maintenance cost?
Most importantly is this sound good value for our money any advice will help.

Reaper

Buying a new build to let is the area where most of the scams are, so be very careful.

Even if you get lucky and they are not a scam and it actually gets built you will be competing with hundreds of other identical properties in the same skyscraper all competing on price to try to rent.

If you really want a buy-to-let property in Liverpool research the market then buy an existing second hand flat.

SonOf

£900pm rental equates to 6% of a £180k purchase price. Not 7%.

Then take into account stamp duty on the purchase.
The fact that new-build flats nearly always lose money immediately on sale and the running costs of being a landlord and the tax.

Longer term, flats always lose money more than houses during downturns.

How about you name the company promoting this as there is a good chance it matches the spam emails that have been going out.

barnstar2077

I agree with Reaper. Do your homework first, once you know the property / renting market in your chosen area inside and out then it is time to find a property. Asking random people on the internet if you should gamble 140k in a new development being built by a company you are not that familiar with is insanity.

Having said that, the 7% yield has my alarm bells ringing. It sounds like the sort of thing a company might say to reel people in.

Is there nowhere near where you live that you could buy a property in? Somewhere you are familiar with.

Eco_Miser

barnstar2077 wrote: »

Asking random people on the internet if you should gamble 140k in a new development being built by a company you are not that familiar with is insanity.

Considering gambling 140k in a new development being built by a company you are not that familiar with is insanity; asking about it on a forum on the internet specialising in investments is not, especially if they then follow the overwhelming advice to not touch it with a bargepole.

OP, if you think renting out a flat in Liverpool is a good idea, why not buy a small share in thousands of flats and spread the risks? I think there are Real Estate Investment Trusts (REITs) that do that, although my own property investments are in commercial property, not residential.

verybigchris

Liverpool city centre is drowning in failed property developments. Even the ones that manage to get built are sitting empty. It's a huge bubble, largely funded by foreign investors who don't have a clue what they're letting themselves in for.


Run. A. Mile.

doe808

Ibsin wrote: »

Most importantly is this sound good value for our money

No.



For reference, I'm a property lawyer by trade.

Ibsin

It is a company called rw investment and they are endorsed by Zooola as well.

Ibsin

Funny enough when I enquired about their investment in their Manchester investment opportunity my name was there and that I was better off to ring Liverpool office not sure why and was told Manchester is not the place to invest in property

Ibsin

What has attracted us is the payment as it is down payment of 40k then the rest after a year which suit our situation that is why, but now I'm hesitant as reading from your answers seems to be there is a lot of hidden cost as well as there is no guarantee of rent income

Reaper

Ibsin wrote: »

It is a company called rw investment and they are endorsed by Zooola as well.

I think you mean "RW Invest" and "Zoopla". In what way are they endorsed by Zoopla?

Their web site fails to include the minimum required legal info such as company registration number, place of registration and registered office address. They are by no means the only web site to fall foul of the law but it never installs much confidence in me when the info is missing.