Continuing my research into bricks and
mortar ownership and “Pension in the Sun” I have evaluated several business
models & strategies which would allow an alternative tangible investment to
be used as a pension fund.
I’ve looked into Commercial, sale &
leaseback and Residential deals. The results prove to be a very
interesting read, if you like me have wondered how so many have made it rich in
Real Estate, you will truly be amazed at the findings at how simple it is to
save and get such a great end result.
Far more fun and exciting to be a homeowner
overseas and use the Pension Fund in places like St Lucia or Cape Verde!
I am still astounding from the concept of Sale & Leaseback these days, it’s
literally 100% lending with very little capital from the investor at
outset. Everything to gain and little to loose, I’m very pleased to
report if you thought that this wasn’t for you then just read on….
I’ve found that Ciaran Maguire Group have
developments in both St Lucia and Cape Verde and that they provide the Sale
& leaseback Scheme.
Types of Business Models for a Bricks
& Mortar Pension
Considering which type of property invest
is the most important consideration of your decision to become a property
investor. You can invest in commercial,
semi commercial and residential properties.
Your decision may lie in the deposit required.
Overseas properties can be bought on a sale
and leaseback agreement, and the developments these days require very little
capital as a deposit...
50% deposit required
Commercial property such as manufacturing
plants factories and offices, have higher returns for rental income and capital
growth, however has a higher level of risk due to its’ need for high capital
deposits, higher losses on non tenancy and is more likely to be effected to the
economic climate.
Budapest (Hungary)
Strong
opportunities in commercial sector, particularly office and warehouse as it
becomes regional business hub. Residential property severely undervalued (per
sqm
60% deposit required
Semi commercial properties such as Student
Lets, blocks of flats and some shops, require specialist lending and
regulations and have past performance of higher critical yields on rents, due
to the individual tenancy agreements or higher rents charged with a shop front
and residential space.
This can be done as a physical assets or
through a fund.
30% deposit required
Residential properties can be bought on a
Buy to Let basis to rent out to your tenants privately or through approved
letting agents. In experienced landlords suffered financially with the downturn
in value of the property, loss of tenants and over zealous lending gave up to
90% since 2003-2008.
The maximum lending in 2012 is 75% but with
lender calculations based on valuation to likely rental income this can fall to
70%.
Popularity over the last few years has been
the overseas purchase, and with house prices in most European countries still
recovering from the over inflation, Emerging Markets are being sort after for
early purchase decisions.
Holiday home freehold investments provide
an opportunity for a rental income immediately which may cover mortgage
payments and future capital in a country which may provide a home when you
retire, with better tax breaks than your country of origin. They are not
restricted to overly regulated lending bank policy and developments ask smaller
capital deposit of the investor.
Sale & Leaseback
This strategy become popular in France, and
historically required a 30% deposit for the property. There is normally a guaranteed rental paid on
a monthly basis which covers the mortgage payments and this way the property
would pay for itself and at the end of the term, you have a freehold property.
100% Lending
·
One particular developer CiaranMaguire Group called Palm View Resorts in St Lucia & Cape Verde has the
following business model
·
6k Euro Reservation Fee
·
The apartment/villa is
purchased at a 70% mortgage
·
8% rental guarantee covers the
mortgage payments
·
The apartment/villa is purchase
fully furnished with a refurbishment package every 3 years
·
30% developers loan is gifted
at 0% and paid back monthly
·
4 weeks a year useage
This means that the investment is
completely leveraged, as an investor it is low risk as the returns are
guaranteed and the amount required for
the purchase is minimal at 6k Euros.
