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Noel Watson

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About Noel Watson

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  • Property investment interests
    I have just started my journey into property developing. At present I am seeking planning permission to convert our private home into three or four flats to start me off on my developing career. I have been passionate about property most of my life but am now intent on furthering my journey with developing. We own several vanilla BTL properties, a large HMO and a small care home for the elderly.
  • My skills
    I have personally renovated a few houses and refurbished all our BTL properties. I now realise that it is important to leverage other people's labour as well as leveraging money.
  • My goals
    My new ambition is to start a development company which I can still be involved with for many years well past the conventional retirement age. Although I am already 65 I am filled with enthusiasm for this exciting new chapter in my life.

    I am not interested in generating money to fund a lavish lifestyle but rather to accumulate wealth just for my sense of achievement and as legacy for my two children. To feel moderately financially successful is my greatest reward.
  • Interests outside property
    I love all kinds of nature whether it be birds, wild flowers, trees, animals or insects. I enjoy walking and running and takings photographs of flora and fauna as well as photographing interesting architecture and landscapes.

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  1. As Scott says 'With capital growth acting in your favour you are technically still paying off an interest only mortgage too.' In addition to this the inflation of currency has the effect of paying off the money you have borrowed on your mortgage. Ten years ago we borrowed a couple of million at the worst time possible in any property cycle. Since then we have had CPI of 26% which effectively knocks £500,000 off the real money we owe. Although we still owe a nominal £2,000,000, due to the erosion of the purchasing power of that borrowed money it could only purchase £1,500,000 of goo
  2. Hi Vicky, Regarding the price of houses as a multiple of earnings and whether this is historically high I am an avid follower of Nadeem Walayat's Market Oracle which states 'What the academics and mainstream press commentators persistently fail to comprehend is TREND, or more precisely the TREND in AFFORDABILITY. The trend over the past 40 years has been for the proportion of household earnings spent on housing costs to rise from 20% 40 years ago to an average of 35% for Dec 2013, which is trending towards 50% by 2030. This is the big story that the academics have missed as over time,
  3. I've never had a pension plan throughout my whole working life. To produce the average pension income of £10,250 per year (excluding the old age pension), a healthy 65-year-old would need a whopping £181,000 in their pension savings pots, Saga Investment Services calculates. If that sounds daunting, you would need £287,000 to generate an index-linked income that rises with inflation. If you have a BTL property costing say £210,000 and look after it yourself you will have the average pension return plus an index linked income. On top of this you will have an asset appreciating at 2.9 % pe
  4. Hi Tony, We owned a care home in Burnham on Sea from 2000 to 2006. We bought it for £270,000 and sold it, after extensions, for £985,000. During this six year period we bought a house in Brent Knoll for £108,000 and sold it for £200,000, another house in Brent Knoll for £170,000 and sold for £235,000, a house in Burnham for £98,000 which sold for £137,000. Our final house in this area was bought for £370,000 but then the market began changing so we only sold it for £385,000. 100K is a good sum of money to start you off investing in property. If you are able to remortgage your present h
  5. Hi everybody, I am easing myself into the role of a newbie property developer and wondered whether any of you have any thoughts regarding this deal I found in Poole. The existing building is a detached two story block of eight flats. Any comments would be very much appreciated. Many thanks, Noel. Poole development opportunity..docx
  6. Hi Damien, Many thanks for your very sound advice most gratefully received. I am so impressed by all your blogs, podcasts, educational and work achievements. You have packed so much into your life after leaving uni and still have so many years left to make an even greater impression on the World. Your desire to help people at the expense of your own financial progress is inspirational! I guess I've already been a bit of a developer without even knowing it when we began extending our care home in Burnham on Sea. We started off by buying the home in the year 2,000 for £270,000. It had 18
  7. Hi Josh, I met a developer last week who told me that he pays 10% interest on any money he borrows for his development projects. The term could be just for the duration of each development or as an ongoing loan. In Bournemouth one can achieve a 6% return on vanilla BTL or around 10% for an HMO. At present you can borrow at around 3% for a BTL so that you are also obtaining a return of 3% from all the money you borrow (as you are getting 6% from your let) less maintenance costs. If property prices increase by 4% over the 5 years fix term and you are leveraging by 4 to 1 then you
  8. On many occasions during my life we have bought the biggest houses that we could buy and filled it with ourselves and our tenants! The tenants paid most of the mortgage and we had a greater level of capital growth as the bigger houses were more expensive. Our latest property is a two bedroom bungalow bought along with a 14 bed care home for the elderly. Our bungalow is 50 yards away from the care home and set in two acres of beautiful countryside in a woodland setting. These are the only two properties down a 600 yard unadopted country lane which is a haven for all sorts of birds and wild
  9. Many years ago we went to view a property but although the estate agent had the key he could not seem to get the front door open. He told us that he would have to try to get a locksmith to open it for him. The owner's work colleagues were firemen and when their friend didn't phone in sick or turn up for work they went to try to find him. They broke the front door down and found him still hanging from the banisters lifeless at the top of the stairs. It emerged that he was having a painful divorce and could not stand the thought of losing the house that he loved. A few years after this we w
  10. Noel Watson

    Day jobs?

    After completing only half a degree in chemistry at the now defunct Westfield College, London Uni I worked as a steel fixer on London building sites for several years. Since then I have worked as a gardener, decorator, handyman, postal dating site owner/manager, house renovator, care home worker/owner and landlord. Considering I have never earned more than £10 per hour for any of the jobs I have ever done I feel truly blessed that I I have generated a reasonable sum of equity during my working life. The vast majority of this equity has come from the capital appreciation of property and not
  11. Hi Everybody, I am hoping to start a small property development company in the near future. I would be really interested in hearing what experiences, successes or failures, other members have had in their property developing projects and how difficult they think it will be for a beginner like me. What would you suggest is the minimum profit margin I should aim for and what pitfalls should I try to avoid. Any information will be most gratefully received. Many thanks, Noel
  12. Hi Carol, The estate agent has his own agenda, namely to sell your house in order that he can receive his commission quickly. He is giving you biased advise to suit his own requirements. I've just had a browse through the properties in Preston on Rightmove and can see lots of very rentable three bedroom houses at around £90,000. You say that the property may need £30,000 to £40,000 spending on it to bring it to a habitable standard and that houses in that street sell for £65,000 more. You could easily get three individual builder's quotes to confirm your estimate of the work and then a
  13. Hi John, This sounds like a great idea. I am always telling people to club together in order to achieve what would be impossible on their own. There are some ethnic communities who do this so well with other members of their family so that as an individual they can gain financial strength and security. Such a lot of people in the property community are really altruistic and have realised that the karma of helping others comes back to them time and time again. As in any syndicate there is safety in numbers.
  14. Hi James, I agree with everything you say and thank you for giving such a comprehensive response. My DD in 2007 wasn't of a very high standard and I had a lot to learn then, as indeed I still do. I guess I relied too much on the enthusiasm of the estate agent without realising that his only agenda was to sell us the flat! I must admit to my only having a short term plan namely just to diversify from houses and to acquire another property to add to the portfolio. We had just sold a care home and I went on a spending spree investing the profits in several properties with a 15% deposit. Gord
  15. I believe that the 3% stamp duty surcharge can be deducted from the capital gains tax on the sale of a property so that it may not have a negative effect for a developer. Even if, like most of us, we like to hold onto our properties if we have 5% capital growth every year then we are making a gain after the first seven or eight months and forever afterwards. If the effect of the extra 3% is to discourage landlords from buying more properties then the one's who do buy have reduced competition and are free to charge a higher rent. Making a negative into a positive is always a satisfying procedur
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