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High Rise & City Centre Developments.


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Hey all,

 

We are looking at the potential of investing in new apartment developments under construction in the centre of Liverpool and Manchester.

 

This is outside our comfort zone of purchasing typical housing and would welcome any advice.

 

The investment companies/agents websites, promise 6-7% yields and near guaranteed lets. Is this sales patter or realistic expectations?

 

  • Any positive or bad experiences?
  • Property Investment/Agent Companies to avoid?
  • Specific risks associated with this type of investment?
  • What type of apartments are best...position, no of beds?
  • Good long term investment?

 

Any advice welcome.


Thanks in advance.


Phil.

 

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Can't speak about Liverpool, but I live in Manchester. 

Personally, I wouldn't touch a flat in the city. There's already thousands of flats in the centre - look on Rightmove and look how long some of them have been for sale or up for rent. Whilst a brand new development may attract some people for the address, if it's the tallest etc, the rest just join the pool of others. 

Aside from my personal view of over supply and over price for the people who want to live in a city centre (younger with subsequent lower wages), there's the usual risks with any new build. How do you know what it's worth - comparison with others may be possible, but are they the same size, view etc. How do you know the development will complete? There's still plenty of shells from the last recession, so I'd be nervous about anything that wasn't a long way towards completion.

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Hi Dino,

 

I've always believed Manchester's property re-development started 10 years before Liverpool, due to the shocking IRA bomb which kick started the city's regeneration. The majority of present developments are now on the fringe of Manchester City Centre as city land is at a premium and they promote economic regeneration in Salford and East of the city. As you suggest there appears to be a glut of flats at present on the market. Liverpool, however I've witnessed the investment and regeneration the city has enjoyed in the last five years.  In particular the water front and Georgian Quarter in the east of the city. Chatting with officials from Liverpool council, they are now encouraging development of space above shops in the city centre as they are keen to increase the number of offices and residences in the heart of the centre.

 

I'm risk averse and looking for a medium to long term investment and will only invest in buildings either nearing completion or just complete.

 

The part I'm unsure about is investing in this type of scheme, is it much different to buying your typical house? Pitfalls? Scams?  Fees?

 

Cheers,

 

Phil.

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