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Property investment strategy - cashbuy, mortgage, crowdfunding?


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Hi everyone,

I have been buy to let market using mortgage for a few years. Now I have some savings and am able to look at other options. I am not sure other options, e.g. cash buy, corwdfunding, are better than my current way. I would like to know your opinions and if there are other better ways than what i know.

1. My current way - apply 80% LTV mortgage buy to let, either 2 or 5 years, rent the property out to provide me monthly income. If the property price increased, i would sell it for some capital gain income or i can keep it for even longer term hoping it will increase more.

2. Cash buy - if the property is £150k market value, sometimes cash buyer could negotiate a good price as the seller urgently need cash. The property could be purchased as £120k or lower. It means after cash buy, i can refinace/remortgage it to recycle the cash. There are some addtional payment, e.g. stamp duty, socilitor fees, etc, but not much. The cash is in theory constantly recycled.

3. Crowdfunding - recently I heard this term and it can provide fixed return of 8-12% in 6-18months, depending on projects. One example, www.sourced.co, they only provide property investment project. Have anyone used them before? It sounds low risk and reasonble return. However, I know that it can't be true and any investment has risks. Anyone has used such method and would like to share your opinions?

Note: There are some pros and cons using ltd company, however, this is not part of the question. The above 3 ways can apply to both personal and ltd company.

I would like to know your opinions on which way produces higher return (obviously higher risk i assume) and if there are other ways. It could end up with similar return and similar risks.

Thanks everyone in advance.

Dawei

 

 

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  • 3 weeks later...

you'd think this would be an easy response, then again depends where someone as an investor are coming from, your own experience, 'reward for risk'

Personally I go for 'reward for minimum risk' with a 'walk away' exit plan.

For me your point 2 fits my objective.

Inside a limited company, I will buy in a good rental area in a University/college town, that has low unemployment. 

Research areas market prices, look for that 'cash opportunity' to buy below market even if it needs some TLC or a bit of fix up.

Take a 3 bedroom single family convert it to a 4 bedroom roomer.

Either rent the rooms & manage yourself or do a 'lease option' with someone.

Then mortgage the property as a BTL based on income, crossed fingers, you may get close your original investment out based on the rental multiples.

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On 10/9/2019 at 4:37 PM, reinvestor said:

you'd think this would be an easy response, then again depends where someone as an investor are coming from, your own experience, 'reward for risk'

Personally I go for 'reward for minimum risk' with a 'walk away' exit plan.

For me your point 2 fits my objective.

Inside a limited company, I will buy in a good rental area in a University/college town, that has low unemployment. 

Research areas market prices, look for that 'cash opportunity' to buy below market even if it needs some TLC or a bit of fix up.

Take a 3 bedroom single family convert it to a 4 bedroom roomer.

Either rent the rooms & manage yourself or do a 'lease option' with someone.

Then mortgage the property as a BTL based on income, crossed fingers, you may get close your original investment out based on the rental multiples.

Thanks a lot, I am looking at either Birmingham or Nottingham currently and seek the approach you mentioned.

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  • 8 months later...

Personally I prefer the crowdfunding model to other ways of investing in properties. I think it is great when I can invest in different countries in one platform and so I can diversify my portfolio. I invest with RealtyBundles and must say that I am satisfied with the results I get. I invested in a German project there. And since the last year, the share value of this project has grown by more than 15%. 

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  • 2 weeks later...
On 7/10/2020 at 4:12 PM, charlottee said:

Personally I prefer the crowdfunding model to other ways of investing in properties. I think it is great when I can invest in different countries in one platform and so I can diversify my portfolio. I invest and must say that I am satisfied with the results I get. I invested in a German project there. And since the last year, the share value of this project has grown by more than 15%. 

How is Germany market now? I guess the pandemic affects global market

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Hi,

  I have been interacting with sourced recently and was looking at a social care investment with them. I have given them the sourcing fee but not had any investment deal from them yet.Its been 3 months & I have not had proper communications from their end.I have had to constantly follow up on when they would source the deal. I had provided my feedback and expectations to them on their service but they have not acted on it. Just based on the experience I am having with them, my personal recommendation would not be go with them.Again I may have been the unlucky investor who is not satisfied with their service.

I would advice further research and look at their guarantees before investing.

Thanks,

Manju

 

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On 7/21/2020 at 9:12 PM, manjunath said:

Hi,

  I have been interacting with sourced recently and was looking at a social care investment with them. I have given them the sourcing fee but not had any investment deal from them yet.Its been 3 months & I have not had proper communications from their end.I have had to constantly follow up on when they would source the deal. I had provided my feedback and expectations to them on their service but they have not acted on it. Just based on the experience I am having with them, my personal recommendation would not be go with them.Again I may have been the unlucky investor who is not satisfied with their service.

I would advice further research and look at their guarantees before investing.

Thanks,

Manju

 

Would you be willing to name the sourcing company? I'm currently looking at some and would like to know which ones to avoid.

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On 7/21/2020 at 8:12 PM, manjunath said:

Hi,

  I have been interacting with sourced recently and was looking at a social care investment with them. I have given them the sourcing fee but not had any investment deal from them yet.Its been 3 months & I have not had proper communications from their end.I have had to constantly follow up on when they would source the deal. I had provided my feedback and expectations to them on their service but they have not acted on it. Just based on the experience I am having with them, my personal recommendation would not be go with them.Again I may have been the unlucky investor who is not satisfied with their service.

I would advice further research and look at their guarantees before investing.

Thanks,

Manju

 

Thanks, muc appreciated for the real experience

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