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To buy or NOT to buy??

To buy or NOT to buy??

Old Jan 7th 2015, 9:30 pm
  #106  
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Default Re: To buy or NOT to buy??

CM,

Firstly, let's take it as a given that nobody can predict the future. I think we should all be able to agree on that.

I strongly disagree that Spanish property would be a better investment, and you're talking to a person who has recently bought Spanish property (although not for an investment). The acquisition costs are higher, the disposal costs are higher, the yield in between is not as good in many areas, and the potential for capital growth is low, IMO.

As for not investing in property as an investment at the moment... I am not over-bullish about property. There are people all over Europe who have been stung badly over the past few years with France and Spain being particularly bad spots. In England, I see plenty of properties on sale at what they were 10 years ago. But, with a FTSE 100 at the same level now as it was 15 years ago, even some of the poorest performing properties have out performed the stock market.

If a person is looking for a diverse set of investments, property absolutely should be part of it. If you have a pension, you most likely have investments in property albeit indirectly.

What's the alternative, bank rates? A flat FTSE?

Originally Posted by cricketman
I said that Spanish property would probably be a better investment than London property if you were buying at the moment

However, I would not advise investing in property anywhere at the moment, unless it is to live in, or unless you have loads of cash and this is just part of an investment portfolio

As for returns, depends on whether it is yield or capital return and depends on area and type of property. For capital returns, you can't predict the future and anyone who says they can are lying. For yield, anywhere between 0-8% depending on circumstances
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Old Jan 7th 2015, 9:30 pm
  #107  
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Default Re: To buy or NOT to buy??

Originally Posted by Horlics
It must differ by area then, as the Spanish I know all have at least 2 apartments, one they live in, the other they rent out.
Many Spaniards have two or more properties. Maybe one in the city and one in their old village or one by the coast.

My in-laws have a flat in the city, a house on the country and their old houses they were born in back in the villages that are jointly owned by their siblings. These houses are worth next to nothing and are used for the odd weekend away by the extended family

However, not many people rent out their properties as rents are so low especially outside the cities and there is little demand and a lot of hassle

I am talking of Spanish people aged 60+ who lived through the "economic miracle" of the 1970s. Young people under 35 own nothing
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Old Jan 7th 2015, 10:31 pm
  #108  
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Default Re: To buy or NOT to buy??

Originally Posted by Horlics
CM,

Firstly, let's take it as a given that nobody can predict the future. I think we should all be able to agree on that.

I strongly disagree that Spanish property would be a better investment, and you're talking to a person who has recently bought Spanish property (although not for an investment). The acquisition costs are higher, the disposal costs are higher, the yield in between is not as good in many areas, and the potential for capital growth is low, IMO.

As for not investing in property as an investment at the moment... I am not over-bullish about property. There are people all over Europe who have been stung badly over the past few years with France and Spain being particularly bad spots. In England, I see plenty of properties on sale at what they were 10 years ago. But, with a FTSE 100 at the same level now as it was 15 years ago, even some of the poorest performing properties have out performed the stock market.

If a person is looking for a diverse set of investments, property absolutely should be part of it. If you have a pension, you most likely have investments in property albeit indirectly.

What's the alternative, bank rates? A flat FTSE?


Best post so far from someone who knows what they are talking about!

I do worry that some people on here that are talking with a great deal of "expertise" maybe are not quite as qualified or experienced as they like to think they are, why not share a little about the investment experiences you have?

Am I an "expert"? Nope, but I did buy my 1st spanish property of 7 in 1989 & my last 1 in 2001 (I own 3 today, all in coastal areas)...I bought my 1st London property in 1997 and my last one in 2005 (still have it today) ...so all I can do is share MY experince based on THOSE investments, and that is that London has performed WAY better in all departments over Spain, but Spain has given us a wonderful "lifestyle" over that time!
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Old Jan 7th 2015, 11:27 pm
  #109  
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Default Re: To buy or NOT to buy??

Originally Posted by Horlics
CM,

In England, I see plenty of properties on sale at what they were 10 years ago
I was comparing Spain to London. Not the rest of England

In central London, a one bed flat will set you back £400k. You might be better off investing in 3 or 4 one bed flats in Madrid instead for the same outlay?

You are correct, there is a high acquisition cost for property in Spain which is why I have said that I would not invest in it

But I most definitely would not be investing in London at the moment, that would be even worse!

Btw, it is perfectly possible to get a good rate of return on 5 year bonds. I bought a large sum from 3 different institutions last year at a rate of between 3.5 to 5%. Now that is a safe bet
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Old Jan 7th 2015, 11:54 pm
  #110  
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Default Re: To buy or NOT to buy??

Originally Posted by cricketman
I was comparing Spain to London. Not the rest of England

In central London, a one bed flat will set you back £400k. You might be better off investing in 3 or 4 one bed flats in Madrid instead for the same outlay?

You are correct, there is a high acquisition cost for property in Spain which is why I have said that I would not invest in it

But I most definitely would not be investing in London at the moment, that would be even worse!

Btw, it is perfectly possible to get a good rate of return on 5 year bonds. I bought a large sum from 3 different institutions last year at a rate of between 3.5 to 5%. Now that is a safe bet


I have never invested in bonds,only property, how does it work? How do you do it? I would be interested to know, thanks!
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Old Jan 8th 2015, 12:32 am
  #111  
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Default Re: To buy or NOT to buy??

Originally Posted by Pablo the sailor
I have never invested in bonds,only property, how does it work? How do you do it? I would be interested to know, thanks!
I was just talking about 5 year bank bonds. You simply find a product you like normally advertised on the bank's website and fill in the application forms

The difficulty is finding an attractive bond for sale. The best rates might only be advertised for a month or two
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Old Jan 8th 2015, 12:34 am
  #112  
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Default Re: To buy or NOT to buy??

Originally Posted by Pablo the sailor
Best post so far from someone who knows what they are talking about!

I do worry that some people on here that are talking with a great deal of "expertise" maybe are not quite as qualified or experienced as they like to think they are, why not share a little about the investment experiences you have?

Am I an "expert"? Nope, but I did buy my 1st spanish property of 7 in 1989 & my last 1 in 2001 (I own 3 today, all in coastal areas)...I bought my 1st London property in 1997 and my last one in 2005 (still have it today) ...so all I can do is share MY experince based on THOSE investments, and that is that London has performed WAY better in all departments over Spain, but Spain has given us a wonderful "lifestyle" over that time!
Nobody is an expert, but we can learn from the past and think ahead. It depends when you bought, what you bought and how much you paid for it. Of course you paid too much for an apartment in 2001 and it might be in the wrong area. I agree that London performed better than Spain, but now we've come to a point where Spain is more affordable. Prices in London are already falling, because it's unaffordable. If you have no buyers, how can you expect the prices to rise. At least in Spain there's a lot of potential, because with lower prices you get more investment and with more investment you have growth. The 5 year bond thing is always a safe option, but you still need enough money to get a good return and aren't as flexible
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Old Jan 8th 2015, 12:38 am
  #113  
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Default Re: To buy or NOT to buy??

I know you were. It was obvious from my response that I understood that.

Originally Posted by cricketman
I was comparing Spain to London. Not the rest of England
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Old Jan 8th 2015, 12:44 am
  #114  
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Default Re: To buy or NOT to buy??

The online trading platforms enable you to invest in all sorts, including bonds. I like iwebsharedealing which is backed by the Halifax.

I don't bother with bonds, though. Using these platforms it is easy to get into and out of just about every fund run by just about every fund manager in the country. With so much choice it makes bonds seem restrictive although they do have a major benefit in their favour, which is a guaranteed return (just about) at good rates in return for fixed length investment.

There's lots of choice, which is best depends on the individual's outlook.

Originally Posted by Pablo the sailor
I have never invested in bonds,only property, how does it work? How do you do it? I would be interested to know, thanks!
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Old Jan 8th 2015, 12:55 am
  #115  
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Default Re: To buy or NOT to buy??

There is nothing to compare to London or even the UK it is a matter of supply and demand. It is a small Island with a lot of people in it. They all need somewhere to live either renting or buying.
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Old Jan 8th 2015, 12:58 am
  #116  
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Default Re: To buy or NOT to buy??

Originally Posted by cricketman
In central London, a one bed flat will set you back £400k. You might be better off investing in 3 or 4 one bed flats in Madrid instead for the same outlay?
No, you'd be better off looking a little outside the centre of London (but still in London) where it costs less than 400k for a 1 bed flat. You would avoid high acquisition and disposal costs and you'd be buying in a place with a better economic outlook. In the meantime, and to your point about rental (which you made in an earlier post), you'd be in a place where you're practically guaranteed to have it occupied at good rates.

Look, I am no big fan of London property. My son rents there now. I know what the flat he rents is worth and if I were to buy it at market value and rented it out at market value, it would not pay for itself over 20 years. I own a flat near my UK house and over 20 years I will get back in rent more than it cost me.

Would I buy in central London now - no. Would I buy elsewhere in London and the UK now - yes. Would I buy in Madrid now - no.

Well, that's my view for investment purposes. I bought in Spain last year because I want a 2nd home to spend time at, not for a return.
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Old Jan 8th 2015, 12:59 am
  #117  
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Default Re: To buy or NOT to buy??

Originally Posted by surreygirl
There is nothing to compare to London or even the UK it is a matter of supply and demand. It is a small Island with a lot of people in it. They all need somewhere to live either renting or buying.
Yes but when they can't afford the high prices then they can't afford it. Simple!
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Old Jan 8th 2015, 1:02 am
  #118  
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Default Re: To buy or NOT to buy??

It seems to me that you have made good choices over the years.

Originally Posted by Pablo the sailor
Am I an "expert"? Nope, but I did buy my 1st spanish property of 7 in 1989 & my last 1 in 2001 (I own 3 today, all in coastal areas)...I bought my 1st London property in 1997 and my last one in 2005 (still have it today) ...so all I can do is share MY experince based on THOSE investments, and that is that London has performed WAY better in all departments over Spain, but Spain has given us a wonderful "lifestyle" over that time!
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Old Jan 8th 2015, 1:04 am
  #119  
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Default Re: To buy or NOT to buy??

Originally Posted by cricketman
Yes but when they can't afford the high prices then they can't afford it. Simple!
There is always a buyer especially at the higher end. Foreign buyers are everywhere. The Chinese, Russian and even Japanese are investing in property in central London which means that people have to buy a little out of the centre which is where my property is. I have to say when I look at prices I cannot see any prices going down. Anything but however I am sure they well soon and prices will level out.

There are plenty of people out there with money who will buy.
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Old Jan 8th 2015, 1:18 am
  #120  
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Default Re: To buy or NOT to buy??

They can buy into a managed fund based on property ownership and management. There is an abundance of them. Your returns are based on property but you can buy in for 100 UKP if you want to.


Originally Posted by cricketman
Yes but when they can't afford the high prices
then they can't afford it. Simple!
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