FAQs..

Propwealth’s frequently asked questions. If you can’t find the info, please email us.

What is Buy-to-Let property?

In the UK there is a massive demand for properties to purchase and subsequently lease out. The venture is popular with investors, because if the property is bought well in terms of position and area, the rent will come in as positive cash flow

What type of return are we getting?

In Liverpool and some other northern cities investors are looking for a 5% + yield.

We prefer mid-terraced Victorian homes, studios and one bedroom apartments that we can renovate and add value. This is because they are built to last and people like living close to transport links, including undergrounds and bus routes. Properties of interest could include a stand-alone home that we can split into two apartments, or sometimes a property we can split into a number of one or two bedroom units.

Our developer of choice observes each property and decides what is going to be the best plan of action to make the most of the space. Every property we look at requires a different approach.

In London, we work with quality developers to bring as much value to the property as possible. Regeneration areas are key, as well as properties being built around a new station. In London, the Crossrail is currently under construction so we are currently focusing on the new stations across London

 

Are there many people doing Buy-to-Let?

In the UK the demand for a second or third property is huge. The UK has a massive buy-to-let culture. Property meetings are held all over the UK where like-minded investors discuss opportunities and trade properties.
If an area is yielding a decent return, then the competition is steep.

 

What type of property do you look for?

Out focus is value sourcing and currently the best value is found in off plan new developments that are fully managed. In Liverpool and some other northern cities investors are looking for a 5% plus yield. One bedroom flats seem to be best option as yields are better.

 

What areas do you work in?

Our main focuses are Greater London, and Northern market towns and cities like Birmingham and Manchester. Prices range from £ 80000 upwards

In London we explore the “bread and butter” properties. These properties start at around £290,000 for a one bedroom.

 

 

Do you work with many banks?

We have a few preferred lenders that we can introduce to you, however our preferences can change over time and we ultimately work with whichever lender will give us and our investors the finance. .

Banks will only lend on purchases of over £100,000 (and a maximum 60% loan to value) to non-resident investors. Having a UK or EU passport but not living in the UK still classifies you as non-resident.

 

How long do we hold onto the property for?

We suggest never selling. We look at our portfolio cash flow as our retirement fund.
The greatest way to build up a portfolio is slowly and carefully. If it does not show a minimum gross yield of 5%+ then we do not invest.

Why are the yields so high in the North ?

Low property prices mean higher yields. One issue is that the banks are not lending to first-time buyers without a large deposit of up to 40% in many cases.
This drives the rental market and makes it a perfect time for the buy-to-let investor.

How long will this last?

This is a difficult question to answer, as the property climate is always liable to change. However, we make the best of the property market and will look to other areas as the climate changes and adapts. In essence, if we continue to find great yielding property, we will continue to buy.

Nevertheless, in spite of all the changes in the world and the economy in recent times, property seems to always remain the one sure investment.

 

Who looks after finding the tenant?

We only work with developers who offer full management services. That is one of our key criteria. They will also collect the rent and deduct the bills for you as part of their service.

 

 

Do you do new builds?

We only  focus on new builds. Once again we look for the up and coming areas and we only invest with larger , reputable companies.

 

 

How do I know that the area is good for tenants?

We do extensive research in the areas and will not suggest the property if you are going to battle to get a tenant.

We invest a lot of our time looking at areas and identifying their potential. This is part of the Due Diligence and the absolute key to the success of a buy-to-let property. We also encourage our investors to put the postal code into Google and “drive around” the area online.

Are tenants scarce and how long does it take to find tenants?

It depends mainly on the development and area. However there is currently a  huge demand for tenants.Its is normally a few weeks.

 

Are you Buy-To-Let t investors?

This is the core of what we do and how Propwealth came about.

We are continually searching for property deals. We either buy them ourselves or try to package and sell them on to other like-minded property investors.

 

Why one bedroom flats?

We prefer one bedroom and studios as the demand for tenants is strong plus the yield is normally excellent. These properties also suit couples so sharing rent is a viable option.

 

Do you always need to add value?

Buying off plan adds value immediately as the completion date might be 2 years off, allowing for automatic capital growth. That’s why we get in early with these development as to maximise capital returns.