£150 - £200k to invest
Discussion
My mother and I are enduring power of attorney for my Grandmother who has been in care for many years with severe Dementia. As of 2009 her care costs have been covered by the NHS as they are deemed a "health" issue - I won't get started on the costs prior to that - and there is pretty much zero chance of us having to fund any further care.
There is circa £300k of her estate remaining and the current investments (fairly simple bonds) are not performing terribly well so I am looking at alternatives.
My gut feel is to buy a brand new apartment in a plush development in Bath for around £160k and rent it out. I believe I could negotiate hard from a no chain cash deal position.
Any thoughts appreciated.
There is circa £300k of her estate remaining and the current investments (fairly simple bonds) are not performing terribly well so I am looking at alternatives.
My gut feel is to buy a brand new apartment in a plush development in Bath for around £160k and rent it out. I believe I could negotiate hard from a no chain cash deal position.
Any thoughts appreciated.
I think that is possibly the worst idea possible - in the nicest way.
New build flats have performed dreadfully and provide awful yields when you take into account service charge, ground rent, agents fees and aggravation you will incur.
If it was me I would buy shares - maybe 20 companies with 10k in each. If you require the income then there are plenty of high yielding FTSE100 stocks out there (think VOD, GSK, BATS) all producing around 5%.
New build flats have performed dreadfully and provide awful yields when you take into account service charge, ground rent, agents fees and aggravation you will incur.
If it was me I would buy shares - maybe 20 companies with 10k in each. If you require the income then there are plenty of high yielding FTSE100 stocks out there (think VOD, GSK, BATS) all producing around 5%.
raptor600 said:
I think that is possibly the worst idea possible - in the nicest way.
New build flats have performed dreadfully and provide awful yields when you take into account service charge, ground rent, agents fees and aggravation you will incur.
If it was me I would buy shares - maybe 20 companies with 10k in each. If you require the income then there are plenty of high yielding FTSE100 stocks out there (think VOD, GSK, BATS) all producing around 5%.
Looking at rents, you'd probably get better than 5% on a flat in Bath and you'd probably be looking at an appreciating asset.New build flats have performed dreadfully and provide awful yields when you take into account service charge, ground rent, agents fees and aggravation you will incur.
If it was me I would buy shares - maybe 20 companies with 10k in each. If you require the income then there are plenty of high yielding FTSE100 stocks out there (think VOD, GSK, BATS) all producing around 5%.
Shares, as we all know, can go up and down! Not sure I'd want to risk all my money in the stock market...
M.
marcosgt said:
Looking at rents, you'd probably get better than 5% on a flat in Bath and you'd probably be looking at an appreciating asset.
Shares, as we all know, can go up and down! Not sure I'd want to risk all my money in the stock market...
M.
Fine, but it isn't the OPs money he's gambling with....Shares, as we all know, can go up and down! Not sure I'd want to risk all my money in the stock market...
M.
marcosgt said:
Looking at rents, you'd probably get better than 5% on a flat in Bath and you'd probably be looking at an appreciating asset.
Shares, as we all know, can go up and down! Not sure I'd want to risk all my money in the stock market...
M.
Yeah because property is a one-way bet and only goes up in value! Over the long term both property and shares will appreciate in value.... history shows that shares have tended to go up much more than property though. 10 years too late to be hoping to make big capital gains on property I'm afraid, rental income is everything.Shares, as we all know, can go up and down! Not sure I'd want to risk all my money in the stock market...
M.
marcosgt said:
Looking at rents, you'd probably get better than 5% on a flat in Bath and you'd probably be looking at an appreciating asset.
Shares, as we all know, can go up and down! Not sure I'd want to risk all my money in the stock market...
M.
Why do you think a property will go up in value yet shares in a growing business won't?Shares, as we all know, can go up and down! Not sure I'd want to risk all my money in the stock market...
M.
It is a very odd assumption.
You are just hoping property prices in general go up in value as you are not able to add any value yourself (especially in a new build).
When you take into account all costs like I listed above I very much doubt you will get over 5%.
It depends on the purpose of the investment.
Are you trying to achieve:
- income for your grandmother?
- capital appreciation for her in her lifetime?
- capital appreciation for her future estate?
- Inheritance Tax mitigation?
Is liquidity an issue - for example there is little point spending all her money on one property if you expect to have to sell it to distribute its value to several hiers later...
Are you trying to achieve:
- income for your grandmother?
- capital appreciation for her in her lifetime?
- capital appreciation for her future estate?
- Inheritance Tax mitigation?
Is liquidity an issue - for example there is little point spending all her money on one property if you expect to have to sell it to distribute its value to several hiers later...
Ultimately capital appreciation for her future estate. I would like my mother to be able to enjoy her retirement rather than spend it, like my Grandmother did, stashing money away to leave to her family only to see half of it get spent on care costs.
Liquidity is not a huge issue - the sole beneficiary would be my mother.
Liquidity is not a huge issue - the sole beneficiary would be my mother.
Have to bump this one as I'm in a similar boat...I'll be ploughing a significant portion of it into my start-up but aside from Stock options, I'm not immediately drawn to much else.
Property as many have said does appear to be more time/hassle than it's worth right now, the inclination is for something essentially low maintenance with a respectable yield until an opportunity arises (But who isn't after that at the end of the day?!).
Classic cars is an interesting idea though
Property as many have said does appear to be more time/hassle than it's worth right now, the inclination is for something essentially low maintenance with a respectable yield until an opportunity arises (But who isn't after that at the end of the day?!).
Classic cars is an interesting idea though
Avoid the new build flats, I have one - a particularly nice and high spec one that rents very easily so far, and I wish i didn't.
If you really want to buy property then think about buying a house, terraces are always good and attract the first time movers and couples that typically rent - and in my very limited experience seem to sell better too.
If you really want to buy property then think about buying a house, terraces are always good and attract the first time movers and couples that typically rent - and in my very limited experience seem to sell better too.
AnnuityAdviser said:
I would say go for the apartment, but check how local prices have fluctuated in recent years
It can work, but you have to be very selective. Quick, usually cash, purchases of low end property in low-appeal areas. Sellers anxious to complete quickly. Can be profitable, but you need to know your area and be decisive. 20% to 30% gross return is possible if you get it right, and are selective about tenants.Gassing Station | Finance | Top of Page | What's New | My Stuff