Private Eye Overseas Market Detective Part 3

How Investors buy Overseas Properties for €6K

Suitably Impressed by my Market Detective skills, I still wanted to uncover what the best form of investment could be for an Executive in Dubai.

 

With so many distractions facing those that live in Dubai, I found that Executives are very cash rich on a monthly basis, don’t have lump sums in the bank, but are very good at paying commitments.

I interviewed Ben Mulvey, 22 yrs old Executive from Dubai who purchased a studio apartment on Palm View Resorts Cape Verde. 

Ben revealed he is investing a mere 1150 Aed per month.  He said “Forget about a pension in the sun, I don’t have to wait until I’m old to enjoy this, I’m on the property ladder, In 7 yrs, I’ll own more than 35% and I can still enjoy 4 weeks usage AND If I sell back two of my weeks per year the apartment pays for itself!

So financial adviser hat back on and doing some number crunching the figures actually did add up.. I followed up on a new resort in St Lucia Caribbean with the same formula to purchase and will be looking at that in the next story.

Ben Mulvey Interview February 2012.

1.       Why purchase an apartment overseas as your First Time Buy?

The problem with buying a property is they wanted a 20-30% deposit.  The apartment Palm view Resorts in Cape Verde required 6kEuros which I saved up within a matter of months.

2.       How did you purchased without the 30% deposit?

This is gifted by Ciaran Maguire Group who is the developers and  this is a loan and paid back at 0% monthly.

So everything you pay back is capital.

3.       How about your mortgage payment on the Palm View Resort?

The banks lend a 70% mortgage and this mortgage payment

Is covered by the 8% rental return I will be paid each month.

4.       Do you receive more income than the mortgage payment per month?

Yes, the mortgage is capped at 7% and I will receive 8% which is

90Euros more per month.

5.       What do you do with the surplus per month?

Naturally it goes towards paying the 30% Ciaran Maguire Group loan at 0%,

so my commitment each month is 1150aed.

6.       What happens if you sell your 4 weeks usage back into the Palm View Resort?

I will receive over €1500 per week and I’m going to keep this in my account

so the investment can actually look after itself, or I can pay the mortgage off early.

7.       What about your contract?

The Palm View Resort apartment comes fully furnished with a 5year rolling contract

I can also sell the apartment whenever I wish.

8.       What was the deciding factor?

The Developers’ Company Ciaran Maguire Group is actually going to be the Five Star Resort owner.  When I’d researched and seen the tourism figures, with the supply and demand, I felt that not only was I going to be a property investor, I also had another industry driving the rentals for my Freehold.