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  • Property-a-holics

    Investing in property funds is a breeze

    When I was 25 I was sold £7500 worth of shares in a fund, that was all my money back then, I was told by a very knowledgeable looking expert that it’s a safe bet, will double my money , etc etc

    in the next 10 years I watched as my money whittled down to £2500. I was still told to wait it out etc etc, and over the next few years it might have climbed back to its original value ???. But I was done with it.

    I finally took my money out , £2200, I remember very well, paid commission left, right and centre and never looked back. I am not giving my money to any smooth talking salesman, they always take their cut even if they make massive losses.

    I know what’s happening with my properties and they will definitely never lose 70% of their value.

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    Can I ask what fund what fund you invest in and the date it started and when you sold out

    was the person who advised you an IFA or direct sales


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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.

    sorry I cant remember the details, i tried to forget this as quickly as I could, it was a standing joke at family Christmas parties: so how much money did you lose this year ha ha?

    it was an IFA though. And I was very green


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    I think the IFA was greener than you

    it’s normal for funds to go up and down

    but even in the crashes it’s always recoved long term

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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.

    One thing I would say is if you needed the money tomorrow, you're not going to be able to easily get it out of property. The shares could be sold, even at a loss, but you could get your hands on the £.

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    You definitely need a healthy cash contingency fund with property investments, mustn’t get into a situation where you have to sell at short notice. 


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    Agreed, but if it was a desperate situation then you'd have more chance of getting the money out today than with property.

    Hopefully it's never needed, but you never know. Having some £cash in the bank instantly accessible is a much better option of course.

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    The problem with viewpoints like this is that if you're not careful, sites like PT just become echo chambers.

    As with any property portfolio, the key to an individual's overall investment portfolio (including shares, property, cash etc) is diversification.

    Of course there will be people here who have had their fingers burnt by smooth talking sharks selling them shares in the past, but on a stock investment forum you will find the same discussions about property. The key is understanding that investors need to educate themselves in all areas that they invest, which often results in a passive route giving the best returns (especially with stocks). I love investing in stocks (via ISA and SIPP) as vehemently as I am interested in property investment, but I know that the best path for me is to pay 0.15% per year to Vanguard and invest in passive index trackers, rather than paying some bloke in a nice suit 3% a year (which compounds) to create a portfolio for me that is probably made up of exactly the same things I would pick myself. The internet has really changed the way that 'average' investors can take advantage from investing in stocks because it decreases costs, and overall that's where most of the 'market beating performance' is found. Many people think of the stock market as some vacuous scary entity, when in reality the best route for 99.9% of investors is to regularly drip feed investment into a simple index tracker.

    Through all the noise, it's the diversification that's the key, especially if your 'end game' is a prosperous retirement. Changes like S24 emphasise this even more. If you're here busily investing away in property but you haven't filled your ISA, have you really taken the time to learn and consider why not? Each investment class has its own positives and negatives, for me the clear ones with stocks are ease of access, low time requirement and tax advantages. For property, it's leverage and the desire to feel a bit more 'hands on'.

    I like to think of my investments like a pyramid where I can cherry pick the best option (from more options) the further down the tree I get. Each year my top priority is to fill my ISA, after that perhaps it's a BTL with over 10% ROI. If I can't find one, perhaps the priority shifts to my SIPP. Max my SIPP (I wish!) and it's back to property etc etc etc, each time picking the right investment at the time to maximise both returns and balance. Of course, it's all subjective and varies with your life situation. For me, property is great because it allows me to keep the snowball running due to the ability to borrow (hopefully sensibly), no other asset classes really allow that, but that still doesn't mean it's necessarily best all the time.

    Anyone throwing all their eggs in one basket may get lucky, but they may well get a nasty shock at some point in life. I feel sad when I see comments like 'oh there's nothing safer than bricks and mortar' because that's just subjective and ignorant. A shrewd investor will make good use of all asset classes for what they are best at, and eek the benefits from all of them. If property is your 'business' that's fine, but you're still increasing your exposure to risk associated with that asset class just like if I ran a shop that gave me all 100% of my income, is that 'safe'? The shop could go into liquidation and all my income would be lost. Equally, small margins on my property may mean that downturns, legislation or some unforeseen issue remove the profit from that asset class too, so you need to diversify your wealth to reduce risk, where another class can take up the slack when one struggles.

    When my wife and I first realised we had some spare funds and the opportunity to invest in something, the rationale was, among other things, that we were very exposed with 100% of our income coming from our salaried jobs, which we had no direct control over, a scary situation that a huge amount of citizens are in and don't even realise it. The luxury of investment is that it lowers your risk by creating multiple income streams. You may have 10 houses and feel your risk is low because they are all 'separate' income streams, but are they really? They are still exposed to the same external risks. Only different asset classes offer me the happy sleep I want.

    Apologies for the rambling Wink

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    My fundamental problem with investing in stocks is that the performance of a company depends on the management, which can change very quickly and is completely out of my control. If the management makes the wrong decisions, they still get paid but they lose my money, not theirs. Unless they commit fraud they are basically unaccountable.

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    What short memories people have. Property funds are great in a bull run but when property prices come under pressure become very liquid and like last time they stop any redemption's.

      So you could be invested, watch the property sector blow up and can't get your money out. Most funds retain an element in shares for liquidity reasons ( ie people buying and selling) so fall in property market reflects immediately on the fund value.

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