X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • Property-a-holics

    Strategy if just starting out with £1million?

    Where would you put your cash in 2019 if you needed to invest, say £1,000,000 (I don't btw) to either create an income stream, safe investment with gains or both?

    Would any still go into creating a property portfolio given the current climate & changes to the sector? Just curious to see what your strategy would be if you had that cash come to you (inheritance, shares, Nigerian email etc) today.

    0
    0

    I would spread the cash around put it in all sorts of assets

    You have come to a Landlord forum so I would imagine you have an interest in property

    But I would not only pick property as the only option

    You could leverage up but you need a strategy ...

    0
    0

    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.

    I would recommend following this strategy presented by investment expert Graham Rowan.  It is a blue-print for creating sustainable wealth:



    Monday -  Taking responsibility for your financial future and how to do that

    Tuesday -  Get educated!

    Wednesday - Create your "income engine" and then turbo charge it!

    Thursday -  Build your "wealth pyramid" to future-proof your wealth.

    Friday - Protect your assets within a "wealth fortress". 

    I would always recommend starting out with a bog standard single occupancy BTL - a terraced house in a good area close to a good transport links and a good school.  These houses are the foundation stones of a solid portfolio.

    If you can buy below market value, force the appreciation through reburbishment/development, then that would help you re-cycle your cash faster, and help you grow quicker.

    Start off with the boring, safe, bread and butter terraces and then raise your game as you become more experience and build you knowledge and contacts.

    2
    0

    Watched 4/5 so far, and they are all very insightful; some amazing great info here! I especially liked the wealth pyramid episode; did you ever get the link to the webinar Graham mentioned?

    Thanks for linking to this Vanessa.

    0
    0

    I'd spread it across about 20 index tracker funds,  10 in the UK and Europe, 5 in the USA,  and 5 in Japan and the far east.  These would be all share funds across the whole index, so that the risk is spread.

    You would be investing in companies like Apple and google and facebook and Sony and BP and Shell and the major utility companies and tobacco and booze.

    That should bring in about 8% per annum. Reinvest the dividends and you will have made £260k by year 3, £470k by year 5, and you will have doubled your money in year 9.

    Better still there is  not a leaking pipe, broken boiler, council official, moaning tenant, blown down fence panel,  money grabbing Chancellor or over flowing HMO maggot infested trolley bin in site.

    If you hit it lucky and get some big returns on a couple of trust funds, say 12% on average,   you could make your second million by about year 6. 

     What's more, you will be viewed as a clever investor,  and not a parasitic evil landlord,.living off the slave labour of your poor downtrodden tenants.

    It's a funny old world.



    6
    0

    I can see where your coming from

    8% a year inc dividends is around 80K a year with out hassle

    it all depends if someone wants a business in BTL or not using leverage

    for an easy life I would use funds



    0
    0

    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.


    While I diasgree with the specifics, I don't disagree with the idea itself. There's a case for buy UK property in general, after brexit. This may happen this year or it may get kicked down the road. In the meantime, a portfolio of about 25 shares in large cap companies that pay steady dividends, away from areas seeing trouble structurally. You should be able to get dividends in the region of 5%, plus there is the possibility of capital gains. A typical portfolio like that is already up around 13% ytd inclusive of dividends paid out. In an ideal world, you reinvest the dividends so next year that initial capital base is even higher. If you need the income to replace the rent then its still a great solution to ride out a couple of years waiting for your ideal situation in property to arise.

    0
    0

    It quite funny how things change so quick in the world

    Before Osborne ect I would have said anyone with a million pounds

    go out and buy BTL property use it to create deposits borrow cash and build a BTL Business

    I would say yes use some of the cash to buy maybe 5 properties with cash and then invest the rest elsewhere ie shares or funds  

    I think having all your eggs in one basket today is unwise 



    0
    0

    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.


    The 13% ytd is quoted far and wide of late, butis only the rebound from the drop in the market at the end of last year. All very well if you went all in at the bottom of that dip, if you were already in the market before the dip your gains now would be roughly any dividends you’ve received.
    I was looking to invest last year, spoke to several advisors all produced wonderful projections of imminent bountiful returns and a future of champagne and caviar.
    Yet whilst all talked of long term investment being the thing to do , all the historical charts were 3/5 year. I then googled all the long term charts for the various funds, all were pretty similar in that they basically followed the overall gains in their respective markets.
    In addition the fund providers, close and then delete information on non performing funds, so you only ever see the sucess stories. 
    As in many things in life there are those that do well and those that lose everything , they are the extremmes the vast majority just follow the general curve, a curve that in recent years has been massively distorted by the financial crisis of 2008 andthe massive global QE that followed.
    My neighbour was a financial man all his working life, ran a major newspaper pension fund for nearly 30 years. He’s 95% cash ( he can’t see where values are justified in many shares, though readily admits that having been retired 30 plus years , the markets have changed , says there is no real money in the most funds once you’ve taken all the fees out and that the only way to make real money is buying and selling on opportunities. ( his last one was when the australian coal mines flooded several years back, he bought british coal that morning and sold in the afternoon for a 20% gain, following day the damamge to the australian mines was said to be minimal and prices stabilised).

    His view is that a decent safe portfolio will give an income after fees of around 3-5%, capital gains in a number of funds will only really show over the longterm and when inflation is taken into account not be spectacular.

    Look at the scandals/problems of the last few years, tesco, pattisserie valerie, paul woodfords fund, deutche bank, diesel emission scandal. The world of business and finance is jittery and there is no real surprise when the next piece of dubious practice emerges.

    As with most things its about buying on the lows and enjoying the highs, then once your in on a dip the long term prospects are much better.

    Also be keep an eye on the benchmarks that investment firms use and ask ,if and when ,these have changed over the years, don’t be surprised if such a question is met with an uncomfortable silence and some slightly flustered responses. Its not a question thats expected.
    1
    0

    I used a ytd to date figure as thats usually a benchmark when looking at things intra-year. As for a rebound after a fall, most of these shares don't really move that much given they are mature businesses with single or low double digit profit growth expectations. So they tend to be quite low beta, in that they move less than the market in general, up or down.. Having said that, the 13% is an actual figure from a real portfolio and includes some dogs such as Imperial Tobacco which is down probably more than 20% ytd (without counting dividend), although as part of a carefully selected yield portfolio, the results are still 13% ytd. And I dare say an expert in the field could achieve better.

    The key to enhanced long term returns is reinvesting dividends, this cannot be stressed enough. This method smooths out poor market timing. However, its not suitable for everyone if their requirement is deriving an income. An alternative is to leave half of the dividends reinvested. With these things you do need to be honest with yourself in terms of income required and income that is realistically achieveable. You can easily select a 10-15% yielder but its questionable as to how long that payout will last. Currently the FT100 yields around 4%. Removing some of the higher beta gets you to 5-6%, that's something that not too demanding (and will still allow for a bit of capital growth over time). If that's not more than enough to cover your income needs, you need to be honest and look elsewhere.

    0
    0