Podcast Summary
EWS 1 certificate and flat investment: Having an EWS 1 certificate for a flat ensures its value and marketability in the property market, eliminating concerns related to cladding issues and securing financing options.
If a flat comes with an EWS 1 certificate, there should be no issue with its value or marketability in the property market. The certificate negates any concerns related to cladding issues, making it a viable investment option for those looking to buy or sell such properties. Rob and Rob, the hosts of Ask Rob and Rob, clarified that while there's always a risk of unforeseen circumstances, having an EWS 1 certificate ensures that financing will not be a problem. Musa, a listener, had asked about investing in flats with cladding and whether they would hold their value despite recent cladding-related issues. The hosts provided clarity on the matter, stating that EWS 1 certificates eliminate any concerns regarding the value and marketability of such properties.
City center apartments, houses: City center apartments may offer better growth potential than houses due to higher mortgage rates, rebound of city centers, and disproportionate price increase of houses during COVID-19. However, choosing the right asset in the right place and considering EWS 1 certificates is crucial.
While houses have traditionally been seen as better investments for capital growth, apartments in city centers may actually offer better growth potential in the current market. Reasons for this include higher mortgage rates leading to a preference for smaller properties, the rebound of city centers, and the disproportionate price increase of houses during the COVID-19 pandemic. However, it's crucial to choose the right asset in the right place. Additionally, there's a riskier opportunity in buying up flats without an EWS 1 certificate, which can offer a good price due to financing restrictions and uncertain repair bills. But this comes with significant risk and uncertainty. Overall, the trend towards apartment growth is an interesting development for real estate investors.
Valuing new build properties: Assess new build properties based on their merits and find comparables, even if they're not similar new properties. Request sales prices from the developer for valuable insight into market value.
When it comes to valuing new build properties in areas where there aren't many equivalent new properties, it's important not to treat them differently than other properties. Instead, assess the new build on its merits and look for comparables. If there are no similar new properties nearby, the new build may still attract a higher rent due to its modernity and lack of required maintenance. However, if nearby properties have been referred to a high standard, there may not be a significant premium. To find comparables, request sales prices from the developer if possible. This information can provide valuable insight into the market value of the new build property. It's a common practice in the industry, and not considered cheeky or unfair. By following this approach, you can make an informed decision on the value of the new build property.
Property value determination: The value of a property is determined by market demand and evidence such as sales records. Off-plan properties in suburban areas or unique developments with superior facilities may still be justified investments despite a lack of comparables.
The value of a property is determined by what people are willing to pay for it. If someone claims a property is worth a certain price, ask for evidence such as sales records. In city centers, it's easier to find comparables to establish the value. However, when buying off-plan in suburban areas or being the first investor, caution is advised until sufficient evidence is available. Even without comparables, if the property offers significantly better facilities or standards than nearby properties, it may still be justified. For instance, a development with unique amenities like a swimming pool, indoor tennis court, and roof gardens, despite being off-plan, can be confidently invested in if it sets itself apart from the competition.
New build differentiation: Offering additional amenities in a new build property can lead to a higher price point, but it's crucial to ensure these offerings truly differentiate the property from competitors in the area.
While offering additional amenities like a concierge service and a small gym in a new build property can lead to a higher price point, it's essential to ensure these offerings truly differentiate the property from competitors in the area. Merely matching what's already available won't add significant value. It's a niche scenario, and not every situation will allow for such a pricing strategy. However, with careful planning and execution, it's possible to establish a premium for a new build property. Remember, the goal is to provide something that sets your property apart and offers a level of luxury or convenience not commonly found in the area.