May 20, 2012

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Use your home as a retirement fund

May 17, 2012 By E Greenwood

Many older people are tapping into the value of their home to provide themselves with an extra form of income to make their retirement that much more comfortable than it would be on their pension alone.

There are different forms of equity release available and you can view the equities release at Age Partnership, on their website. Age Partnership is an independent company that searches the equity release market to find the best deal for an individual looking to free up the equity in their home.

To see how much of a lump sum, you could secure through an equity release use the Age Partnership equity release calculator on the agepartnership.co.uk website. You need to put in a few details like the value of your home and the size of current mortgage that you have outstanding and the age of the youngest homeowner. Then an idea of the amount you could access through equity release will be calculated and emailed to you.

The equity release calculator will also show you how the accrued interest will affect the remaining equity after a lifetime mortgage has been taken out on the property. It gives you a realistic financial picture of where you will stand once you have taken out a lifetime mortgage. And remember that if house prices increase, this is offset against the value of the loan.

If you don’t like filling in online forms, you also have the option to call Age Partnership for a quote over the phone. Like the online equity release calculator, the advice over the phone is free of charge. And, as with any insurance policy or loan, it is always worth getting quotes from a couple of different providers so that you can compare the products on offer.

Filed Under: Uncategorized

Property Owners Need Good Insurance Policies

April 17, 2012 By E Greenwood

If you make your income out of owning and renting properties, then you have undoubtedly realised that there are many advantages to working for yourself and being your own boss.

You can do what you want, when you want. Your timetable’s your own and you don’t need to answer to anyone.

But with such independence and freedom, you do lose out on the kind of benefits that many employees take for granted. You don’t have the security of knowing you’ll get the same monthly pay cheque and you don’t get offered any extra perks like private health insurance and paid holidays. Life’s a lot less predictable when you’re self-employed.

So, as well as taking care of your property portfolio and making sure you maximize the income you can get from your properties, you have to make sure that you have adequate insurance to protect you in case of any loss of income or ill health.

One such kind of insurance is life insurance. This is a very practical choice if you have dependants who rely on you for their financial security. If the worse were to happen and you were to die, at least your family would be supported financially. There are lots of cheap life insurance policies available, but you should check the details carefully before you decide which policy to takc out.

Family life insurance offers your family security in the case of your death. On the policy holder’s death a benefit is paid out for the remaining years on the policy. This kind of insurance will give your family a tax-free monthly income rather than a lump sum. It’s a comfort to know that if you do die, your partner will have a helpful and valuable income to provide for your children’s upbringing.

Every policy is different and you need to work out living costs and make sure the policy you take out will cover these. The higher the payments you want to have on the policy in the case of your death, then the higher the premiums will be. It is worth sitting down with a financial adviser to decide what kind of level cover is most suitable.

Filed Under: Landlord Advice Tagged With: , , , ,

Ask any property developer…

December 14, 2011 By E Greenwood

Ask any property developer what makes a good property investment and the ones that have been around a long time will always tell you to focus on the income rather than the capital.

So what does this mean?

Well when real estate is on its knees as it has been for the last here or four years now, a solid rental is far more important to you than a rising capital value. In short, capital values aren’t going anywhere. So let’s say you bought at the absolute peak of the recent property boom right at the end of 2006 or maybe in early 2007 – still long before the Lehman’s collapse – and at a time when people still seemed to think property was a one way bet.

If, at that time, you concentrated solely on the income the property would be likely to continue to provide through the good times and the bad and you weren’t thinking; “I’ll make a quick buck here as it’ll be worth half as much in again in a few years’ time,” then you’re probably doing OK.

Sure, the value has probably fallen along with everything else – but your focus is on the yield right?

Sadly, this isn’t what most people did and the bubble was a bubble like any other; irrational in other words. The long and short of it is that the yields didn’t make any sense back in early 2007, so following the principle of focussing only on the income rather than the capital would have safely ruled you out of any overly optimistic bubble-related irrational purchase. You wouldn’t find David Lichtenstein or any other savvy real estate developers buying around the peak – they knew it didn’t make sense; all they had to do was look at the percentage income figures and it was a case of “no thanks!”

Filed Under: Buying To Rent Tagged With: , , , ,

Do you believe in peak oil?

December 13, 2011 By E Greenwood

If you do believe in peak oil theory and you aren’t trying your hand at oil trading then why not?

If you’ve already been a successful property investor, you may want to try an additional area like oil to boost your income. There are absolutely no guarantees of success, of course, but for those of us who do believe in peak oil, then we really ought to be putting or money where our mouths are.

First off, what is peak oil all about?

Very simply put, peak oil theory has it that as oil is a finite resource and as the so called BRIC economies of Brazil, Russia, India and China are growing like there’s no tomorrow, then the world’s demand for crude oil will keep on rising as these hugely populous countries all want cars and generally increase production to meet demand of various oil-consuming products like plastics etc.

That’s a very crude explanation of course – pun most certainly intended.

No-one really knows how much oil we can yet reasonably access as a species, but BP’s Deep Horizon oil well disaster in the Gulf of Mexico last year shows just how desperate the companies are to drill deeper and deeper for the black stuff. The peak oil theory holds that we’re near to passing or maybe have even already passed peak production.

Most pundits agree that we’ve used up most of the easy-to-access oil, so the remaining reserves are less accessible and so costlier from which to extract oil.

Ergo… you’ve guessed it, the oil price keeps on rising until we find sufficient alternatives and find ways of using less. Alongside the environmental concerns, this really explains the world’s increasing fascination with alternative energy forms and cars that run for 100 miles or more on a gallon of petrol etc.

Anyway, if you believe in the theory as I do and think the price of oil will gradually move to $200 a barrel over the next five to ten years, perhaps you should be trading oil – or at least trialling it with a broker in a demo only environment to see how you get on?

This article was written by David, a keen trader. Recently, he has been trying to boost his knowledge of oil trading, hoping it’ll help him score bigger deals.

Filed Under: Your Budget Tagged With: , , , ,

An easy way of investing in property

November 22, 2011 By E Greenwood

Over the last decade or so, many people thought they were shrewd investors by virtue of the fact that they bought properties – whether commercial or domestic – watched them go up in price and counted their equity increases.

Unfortunately, such profit wasn’t really real – save for the lucky ones who managed to enter somewhere near the bottom and exit somewhere near the top.

The property price falls of the last few years have taught such investors a valuable and salutary lesson, sadly.

The price falls have been seen as some as an opportunity to get back in. In the UK, rental yields have also increased, but not enough in most cases for the investment to make a great deal of sense – unless we start to see the kind of capital gains we saw from the mid 1990s until early 2007.

This doesn’t look likely.

But there is an easy easier of investing in real estate that could provide the kind of returns we saw previously. This is via listed companies involved in real estate and real estate development. Many of such companies’ valuations now lie at healthy discounts to their net asset values – so if you believe they’ll survive and eventually prosper again – you’re effectively buying a part of the properties they own at around 60-80% of their true underling value.

It’s essential to have a good look at the companies’ investments of course; just as closely as you might a real ‘physical’ property investment of your own.

Also, if you believe in the ‘first in first out’ type of principle when it comes to a recession, you may want to take a look at US properties. These have seen some of the sharpest declines and may yet see the steepest rises as we come out the other side; maybe!

Go for a diverse portfolio of solid investments. The Lightstone Group may be worth a look. Connect with David Lichtenstein (founder and CEO) and follow the company’s broad investment principles and you shouldn’t go too far wrong trying to emulate them.

Filed Under: Buying To Rent Tagged With: , , , ,
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