How good/bad is this plan?

westernpromise · 13 June 2018 at 9:30AM

You're essentially speculating in property prices and exchange rates, unless you intend at some point to return from miserable grey Dubai to live permanently in beautiful sun-soaked Sheffield. In that case you arguably need to be hedged against UK property prices, but student housing in the north isn't necessarily the best hedge.

AnotherJoe · 13 June 2018 at 9:59AM

bluefukurou wrote: »

So you'd be advising to go down the shares rather than property road? I know very little about shares, but I've read that a tracker fund seems to be considered a popular long term and fairly safe route. As I said, a property, plus a load in shares is something I'm interested in. At the moment I've saved £80k and that will continue to grow each month, so I'd prefer to do something rather than let inflation erode it.

Shares / funds etc will not call you up at 3am when there's a leak in the roof, a broken sink, the heating doesn't work.

Shares will not have a void period.

Shares will not incur a 20% management fee (at elast, once you add on the more than usually expensive costs to have anything fixed if you are absent and leave it to the agent to arrage a plumber, electrician, roofer etc)
Unlike property, shares can be sold fractionally to minimise or eliminate CGT.
Shares allow you to diverisfy, With a property you are 100% in the (say) Sheffield / Student / Terraced house market. In Shares you can be in the global economy.
Shares will not trash the entire investment, do a moonlight flit nor need legal action to evict non rent paying tenants.
You can invest in property via shares, even individual rental (theres at least one company that allow you to buy into a portfolio of BTLs, not for me but better IMO than all-in one one.)

Out,_Vile_Jelly · 13 June 2018 at 10:32AM

You really need to do some research into the student letting market.

Most universities have now cottoned on to the fact that decent quality en-suite rooms in halls are extremely lucrative, as they can be used for conferences/short term lets during holidays (Warwick were the trailblazers in this I think). There are also more international students than ever, especially middle class Chinese, who are not interested in the traditional sharing of a scuzzy mid-terrace; they expect hotel room quality. Most student towns are now seeing expensive accommodation blocks going up.

So the market for your typical student house is falling, not a great time to invest.

It's good that you've got money to think about, why not speak to a financial advisor next time you're in the UK? Or you could aim to buy a nice property outright within the next few years?

tom9980 · 13 June 2018 at 11:15AM

Out,_Vile_Jelly wrote: »

You really need to do some research into the student letting market.

Most universities have now cottoned on to the fact that decent quality en-suite rooms in halls are extremely lucrative, as they can be used for conferences/short term lets during holidays (Warwick were the trailblazers in this I think). There are also more international students than ever, especially middle class Chinese, who are not interested in the traditional sharing of a scuzzy mid-terrace; they expect hotel room quality. Most student towns are now seeing expensive accommodation blocks going up.

So the market for your typical student house is falling, not a great time to invest.

It's good that you've got money to think about, why not speak to a financial advisor next time you're in the UK? Or you could aim to buy a nice property outright within the next few years?

You are describing my Uni exactly they purchased the local YMCA recently planning to convert it into 120 or so units. They already own a lot of accommodation on uni sites as they have expanded a lot in the past 15 years, this has squeezed the buy to let student investors you see a lot of them advertising an empty room or two all the time all year round, so i do think a fair chunk are empty or have had to accept student tenants who have riskier profiles.

Personally as a Landlord myself i think the OP is mad and should invest in something else.

bluefukurou · 13 June 2018 at 2:55PM

westernpromise wrote: »

You're essentially speculating in property prices and exchange rates, unless you intend at some point to return from miserable grey Dubai to live permanently in beautiful sun-soaked Sheffield. In that case you arguably need to be hedged against UK property prices, but student housing in the north isn't necessarily the best hedge.

Bad tenants aside (something that can be mitigated with insurance?) and avoiding student housing with all the potential grief that could bring, I can't see how owning a small property, in a city I will very likely return to, is too speculative.

Wouldnt a small rental property bring in a steady income even if there's not much capital growth? I wouldn't have a mortgage around my neck and be subject to interest rate rises. I would also expect to have the property until retirement.

bluefukurou · 13 June 2018 at 3:03PM

Out,_Vile_Jelly wrote: »

You really need to do some research into the student letting market.

Most universities have now cottoned on to the fact that decent quality en-suite rooms in halls are extremely lucrative, as they can be used for conferences/short term lets during holidays (Warwick were the trailblazers in this I think). There are also more international students than ever, especially middle class Chinese, who are not interested in the traditional sharing of a scuzzy mid-terrace; they expect hotel room quality. Most student towns are now seeing expensive accommodation blocks going up.

So the market for your typical student house is falling, not a great time to invest.

It's good that you've got money to think about, why not speak to a financial advisor next time you're in the UK? Or you could aim to buy a nice property outright within the next few years?

tom9980 wrote: »

You are describing my Uni exactly they purchased the local YMCA recently planning to convert it into 120 or so units. They already own a lot of accommodation on uni sites as they have expanded a lot in the past 15 years, this has squeezed the buy to let student investors you see a lot of them advertising an empty room or two all the time all year round, so i do think a fair chunk are empty or have had to accept student tenants who have riskier profiles.

Personally as a Landlord myself i think the OP is mad and should invest in something else.

Thanks for raising these issues. I have been doing research and part of it is this thread.

bluefukurou · 13 June 2018 at 3:13PM

AnotherJoe wrote: »

Shares / funds etc will not call you up at 3am when there's a leak in the roof, a broken sink, the heating doesn't work.

Shares will not have a void period.

Shares will not incur a 20% management fee (at elast, once you add on the more than usually expensive costs to have anything fixed if you are absent and leave it to the agent to arrage a plumber, electrician, roofer etc)
Unlike property, shares can be sold fractionally to minimise or eliminate CGT.
Shares allow you to diverisfy, With a property you are 100% in the (say) Sheffield / Student / Terraced house market. In Shares you can be in the global economy.
Shares will not trash the entire investment, do a moonlight flit nor need legal action to evict non rent paying tenants.
You can invest in property via shares, even individual rental (theres at least one company that allow you to buy into a portfolio of BTLs, not for me but better IMO than all-in one one.)

You mention a lot of good points there. What happens when the stock market crashes though?

I get that long term, you can't beat shares, and you avoid all the possible landlord woes. I hope to invest in both a rental property and some shares, stocks, etc.

Gwendo40 · 13 June 2018 at 6:04PM

westernpromise wrote: »

Remember that if you own anything you are hated by all political parties, we are closer than ever in history to having a Marxist PM, and that as a property owner you are very easily robbed..

I assume you're referring to (and probably losing sleep over) the prospect of chairman Corbyn becoming PM... If he does gain power and if he stops hosing money at the banks and the housing market it would actually be the most capitalist act that any PM has done for at least 2 decades. Ironic eh?

bluefukurou · 14 June 2018 at 9:29AM

genau wrote: »

If I were to advise you then I'd do the following to start with.

1. Choose a vanilla type of freehold property and definitely absolutely not a flat
2. Location location location with future potential uplift (Always locations will have uplift even in a national decline)
3. I would not buy up north unless it was in very specific areas.

North:

Manchester/Leeds/Sheffield/Birmingham and certain other parts like Harrogate/York etc

Anywhere down south but not as far as the South west beyond Bristol

My plans are in line with those three points. I'm looking for a freehold, good old fashioned terraced house in not posh, but decent area of Sheffield. When I say decent I mean relatively crime free, near schools and with good transport links.

Something like this:

http://www.rightmove.co.uk/property-for-sale/property-65266054.html

westernpromise · 14 June 2018 at 9:34AM

bluefukurou wrote: »

I'm looking for a freehold, good old fashioned terraced house in not posh, but decent area of Sheffield. When I say decent I mean relatively crime free

That made me laugh out loud for some reason....

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