Singing Pig

brit1234:

rc169:

Which ones? I see this sort of statement repeated often at the moment, but rarely with any more details. I would be genuinely interested to know - I am a property investor, and have achieved satisfactory returns, but I am broad minded enough to consider other forms of investment, if the full information is available. Unfortunately it rarely is.

 Last year the big ones were most metals, oil and international agriculture.  At the moment if it wasn't for the mining stock the FTSE would have fallen far more.Have a listern to some of the podcasts on this site below to give you some idea or watch the videos on Bloomberg.http://www.minesite.com/webcasts/commodity_watch_radio.html

don't take this the wrong way brit ... but did you actually invest in any these ... if so did you actually make any money?  how much?  %?  if you didn't invest, why not?  if there were sound reasons, what were they?  if there weren't sound reasons, why are you posting on a financial freedom website (!) ... i'm genuinely interested.  i was having a chat with a friend the other day who seriously thought that cash (itself) was an investment?  when i queried how the underlying capital value would be maintained while skimming off the income my mate's face was a picture ... the concept of actual investment, risk vs reward, income vs capital growth ....... etc ...... had passed him by.  it's all very way dissing other people's investment plan .... without showing your own?!  (take this is the constructive way intended!!)............

mbga9pgf3:

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 Everyone who signs the mortgage paperwork needs to realise 2 things; they are renting from the bank until they make their last payment, and they shouldnt sign up to financial arrangements they do not have the means to pay back (and banks are also are responsible for not saying no).

 

I would suggest the "Bull trap" = the unexplained 2005 boom... 

 

Choices 

Rent from private landlord a 200k property for 1200 pm 

Buy a 200k property on mortgage and pay 1200 pm

 

After 25 years purchaser owns a 200k  more than likely worth in excess of 500k then outright.

 

Renter owns nothing !!!!!

Do the maths.

If you truely are a singing pigger you would know the value of property ownership, business owner ship and a sound financial education. Property is just another asset class and if used rightly an owner will always be better off than the renter in the long run. 

Correctly financing the purchase and sticking to the repayments is all together a different story.

Ask the people who bought 20 years ago whether they regret making that purchase now ? I am sure you know the answer.

Property has always been a medium to long term investment vehicle and it is only some of the more unscrupulous investment clubs and so called property experts which will tell you any different especially if you pay them a fee.

PGtips, you know those figures arent realistic at the moment, FACT.  You cant cover a house with a mortgage you can rent for 1200 pcm without taking a loss.  My calcs, even on current BMV in an area such as hereford would require you to purchase a £450000 house to gain rents such as that.  Another thing, if you have a 80% mortgage on a property like that, when prices drop, you still pay for the 450K plus your loss, whereas if I use the acomodation provided to me through work at significantly lower than the typical market rate, then Its win-win I am afraid.

I would rather have a mortgage of 100K on a property that is currently valued at 450K than have a 400K mortgage on a property that has significant falls ahead of it.  Whilst I am paying less in rent than what I would pay in interest alone, I am sorry, but youir sums simply dont add up. (as long as you save the difference of course!)

 

Pod, as an aside, would you agree that purchasing at the top of the cycle will get you  significantly less  for your money than investing at the bottom?

Thats what I have been all about on this site since 2006; I have never said that property is a poor "investment vehicle" as you call it, I have only ever argued that since around 2005-2006, property has been a poor choice of investment due to market timing.  I guess the housing minister and Mervs comments yesterday have proved me right; either way, time will tell.   I have to be honest though, I am sitting quite happily on my 37.5K (and growing) deposit at the mo; I get the impression from my bank manager that he would lick my boots rather than have me move my accounts (which I threatened to do if they increased charges on my current account; I explained I knew all about Basel II and that I was capable of removing 4 Million in lending potential for his bank at the press of a computer Key).
 

mbga9pgf3:

 

Pod, as an aside, would you agree that purchasing at the top of the cycle will get you  significantly less  for your money than investing at the bottom?

 
I wouldn't bother Sam. I've asked this question many times and only ever received responses that drone on about "medium-to-long term investments" and actually ignore the question altogether.

mbga9pgf3:

PGtips, you know those figures arent realistic at the moment, FACT.  You cant cover a house with a mortgage you can rent for 1200 pcm without taking a loss.  My calcs, even on current BMV in an area such as hereford would require you to purchase a £450000 house to gain rents such as that.  Another thing, if you have a 80% mortgage on a property like that, when prices drop, you still pay for the 450K plus your loss, whereas if I use the acomodation provided to me through work at significantly lower than the typical market rate, then Its win-win I am afraid.

I would rather have a mortgage of 100K on a property that is currently valued at 450K than have a 400K mortgage on a property that has significant falls ahead of it.  Whilst I am paying less in rent than what I would pay in interest alone, I am sorry, but youir sums simply dont add up. (as long as you save the difference of course!)

 

Pod, as an aside, would you agree that purchasing at the top of the cycle will get you  significantly less  for your money than investing at the bottom?

Thats what I have been all about on this site since 2006; I have never said that property is a poor "investment vehicle" as you call it, I have only ever argued that since around 2005-2006, property has been a poor choice of investment due to market timing.  I guess the housing minister and Mervs comments yesterday have proved me right; either way, time will tell.   I have to be honest though, I am sitting quite happily on my 37.5K (and growing) deposit at the mo; I get the impression from my bank manager that he would lick my boots rather than have me move my accounts (which I threatened to do if they increased charges on my current account; I explained I knew all about Basel II and that I was capable of removing 4 Million in lending potential for his bank at the press of a computer Key).
 

 

Pod we seem to be at different ends of the scale. let me give you an example of a property I bought in 1998.

Purchased for 61k mortgage circa 500pm

today valued at 165k

My initial investment totalled 6k

What is the growth 104 k presume I sell at 10% below market value

148.5 k - 61k = 87.5k gross, when this process has been repeated a few times over the years you can see why your 37.5k deposit is dwarft.  

Remember my initial investment was only 6k !!!!!! Growth of about 1300% !!!

I have always stated and will continue to state property is a medium to long term investment. 

Anyway keep your 37.5k in the bank and watch it grow.

 

I should also add that I have been dabbling in property for the last twenty years, was a financial advisor who encourage many ex council tenants to take up the right to buy, and more than just a few have done very well for them selves. I have also encouraged friends and family to buy property well before all this buy to let frenzy began, and most who took my advice back then are worth a pretty penny now.

Property should be seen as a mid to long term investment vehicle and why not just enjoy it as your home. In 10-20  years time you will look back and thank me for this advice, and the years will go by quicker than you think..   

Pod, as an aside, would you agree that purchasing at the top of the cycle will get you  significantly less  for your money than investing at the bottom?

 

If the figures do not stack up, ie the rent does not comfortably cover the mortgage leave alone. Simple !!!

If you can buy a good deal below market value and yield is good, why would you not buy ? Or better still why not use the money you pay in rent to pay off your own mortgage, if you can buy a place cheap enough to justify this ?.

SpeedyThing:

mbga9pgf3:

 Pod, as an aside, would you agree that purchasing at the top of the cycle will get you  significantly less  for your money than investing at the bottom?

 I wouldn't bother Sam. I've asked this question many times and only ever received responses that drone on about "medium-to-long term investments" and actually ignore the question altogether.

ahhh. diddums speedy!  not quite sure what exactly you're spitting your dummy out about ... you came on a the property section of a financial freedom website & got the answer you must, surely, have been expecting?