Podcast Summary
Lessons from Rejected Properties and Investments: Experienced investors like Rob and Rob reject potential deals for various reasons, providing valuable insights for listeners on what to avoid. Understanding the reasons behind rejected investments can help make informed decisions.
Key takeaway from this episode of Ask Rob and Rob is that even experienced property investors like Rob and Rob reject potential deals for various reasons. They shared some recent examples of properties they passed on, providing valuable insights for listeners on what to avoid. To submit your own question for their consideration, visit thepropertyhub.netforward/ask or call 013808 triple 035. Rob and Rob emphasized the importance of understanding the reasons behind why certain investments may not be suitable. Anthony's question asked them to discuss rejected properties and investments, and they were happy to oblige. They shared that while they come across many opportunities, not all of them align with their investment strategies. For instance, Rob shared an instance where he was interested in a property, but the location didn't fit his criteria. Rob and Rob also discussed the importance of considering factors like property condition, market conditions, and personal circumstances when making investment decisions. Rob emphasized that they share both successes and failures on the podcast to help educate their audience. By discussing rejected properties, they hope to help listeners avoid similar mistakes and make informed investment decisions. Overall, this episode underscores the importance of careful consideration and due diligence when evaluating potential property investments.
Assessing Real Estate Deals: A Case Study: Thorough research and analysis are essential when evaluating real estate investment opportunities. Check comparables, recent sold prices, and potential risks before making a decision.
Conducting thorough research and analysis is crucial when evaluating real estate investment opportunities. Using recent examples, the speaker explained how they assessed two potential deals and why they decided against them. In the first instance, they were offered a discounted deal on a block of apartments in Northampton. However, upon investigating the comparables and checking recent sold prices on Rightmove, they found that the prices were not significantly lower than market value. Therefore, they decided not to pursue the deal. In the second instance, they were wary of a development in Greater Manchester due to the type of construction of the office block being converted to apartments, which raised concerns about mortgageability. These examples demonstrate the importance of assessing comparables, checking recent sold prices, and considering potential risks before making a real estate investment decision.
Importance of thorough research in property investments: Thorough research can prevent investors from losing money on off-plan developments by uncovering potential risks like mortgageability issues, hidden fees, and unstable developers.
Thorough research and due diligence are crucial in property investments, especially when dealing with off-plan developments. A mortgage broker's warning about a Manchester development saved potential investors from losing money, despite the property's attractive price and location. The developer's offer of high commissions was a red flag, and the company eventually went under. By conducting extensive checks upfront, investors can minimize risks and avoid costly mistakes. It's essential to consider mortgageability, location, and potential hidden fees when evaluating investment opportunities.
Don't overlook deposit protection in property investment deals: Investors must verify deposit protection's legitimacy to avoid losing millions, especially in off-plan investments. Seek professional advice and thoroughly investigate deal details.
While checking the fundamentals of a property investment deal is crucial, it's equally important to ensure adequate deposit protection. The speaker shared a personal experience where they almost lost their deposit due to insufficient deposit protection in an off-plan property deal. Despite the attractive location, discount, and other factors, they were advised by a solicitor that the deposit protection was not reliable. This experience serves as a reminder that deposit protection should not be overlooked and that investors should take extra measures to verify its legitimacy. The consequences of inadequate deposit protection can be severe, with potentially millions of pounds lost, as seen in past cases involving off-plan investments. This is a particular risk for overseas investors. To avoid such tragedies, it's essential to go beyond the traditional checklist and consider the deposit protection as a critical aspect of the investment. This discussion highlights the importance of seeking professional advice and thoroughly investigating the details of a property investment deal, including the deposit protection, to minimize risks and maximize returns.
Considering Selling a Flat for a Cash Injection: Tom may benefit from selling a flat with limited growth potential to release cash for a new home and investment, checking its location and potential equity first.
Tom and his girlfriend are considering selling a flat they own in Edinburgh to release cash for purchasing a house in New Zealand and potentially investing in another property. The flat, which is a 2-bedroom unit, has been owned for nearly a decade, and Tom is seeking advice on the best course of action. The flat's value hasn't significantly increased over the past ten years, and the mortgage is a standard residential mortgage, not an interest-only or buy-to-let mortgage. The flat's lack of growth is surprising, considering Edinburgh's recent strong property market performance. However, Tom should check the property's location and consider the potential equity growth from the repayments made over the past decade. If there is substantial equity, selling the flat could provide a significant cash injection for their new home purchase and investment.
Should I sell my underperforming buy-to-let property?: Consider property improvements, switching to a buy-to-let mortgage, selling for a new residence, or investing in another property before deciding to sell an underperforming buy-to-let property.
If you're considering selling a property that's not performing well as a buy-to-let investment, it's essential to weigh the pros and cons carefully before making a decision. First, assess whether improving the property could increase its profitability. If switching to a buy-to-let mortgage is an option, consider the potential benefits, such as increased cash flow and long-term appreciation. However, be aware of the higher deposit requirements compared to residential mortgages. If enhancing the property's performance isn't feasible or won't yield significant improvements, evaluate what you could do with the sale proceeds. Contemplate using the funds to buy a new residence or invest in another buy-to-let property. Remember, there's more to life than just focusing on investments. Ultimately, the decision should be based on your personal circumstances, financial goals, and emotional attachment to the asset.
Weighing the pros and cons of selling a property for cash vs keeping it as a buy-to-let: When deciding whether to sell a property and invest the cash elsewhere or keep it as a buy-to-let, evaluate potential returns and choose the best investment for your financial future.
When considering whether to sell a property and invest in something else, it's important to evaluate the potential returns of keeping the property as a buy-to-let and selling it for cash to invest elsewhere. If the potential return on the buy-to-let is not satisfactory, it may be worth considering selling and investing the cash in a more compelling opportunity. This decision can be a tricky one, but having a framework to evaluate the potential returns of both options can help in making an informed decision. Ultimately, the goal is to maximize returns and make the best investment for your financial future. The podcast will be back on Thursday with more property-related insights and advice. Stay tuned for Ask Rob and Rob next week.