More Opportunities For Africans To Invest In Property In The UK
Baron & Cabot have now expanded in Kenya and Nigeria. Africans can now invest in property within UK.
Baron & Cabot, a UK property investment company has launched their new base in Kenya and Nigeria to finally help Kenyans and Nigerians invest in property within the UK in a simple and effective way. “Baron & Cabot is undoubtedly the fastest growing UK property investment company in the world,” remarks Mark Pearson, founder of Baron & Cabot.
“We aim to help Kenyans and Nigerians with the ability to provide mortgages and buying of property through thorough research for the safety of their investment in the UK.”
Investing in property in the UK is greatly considered to be one of the lowest risk investments in the world, with consistent long-term returns factored in by continuous growth within the country. Baron & Cabot has built a market leading research strategy for the investor to simply just choose what would be suitable for them. The investor is also granted a step-by-step guide on sourcing the right property to purchase in the UK. This gives the investor the power and confidence to ask the right questions for profitable property investment.
“As the demand for property investment rises within African investors, our main goal is to make sure the process of property investment always remains transparent and simple.” added Mark Pearson, founder of Baron & Cabot.
A great opportunity presented by the UK is that foreigners can legally buy property or have banks offer favourable mortgage terms for investment. This investment platform gives Africans an opportunity to invest in property with ease and without limitations. Thus, while seeking to invest in property, Baron & Cabot stands out to be the paramount property investment organization that an investor can trust through the investment process.
“Our introduction in Kenya and Nigeria will greatly impact property investment and sourcing in the UK, thus creating more options for investors”, says James Walsh, Head of Sales at Baron & Cabot Research. Baron & Cabot has worked with investors across the world and impacted many from their first to fifty first properties. This expansion creates a great opportunity for African investors.
Source Article: Forbes Africa, Africa Business
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Why you should build a 10-year cash flow.
We have tons of videos about why a one year plan can be a poor strategy for you. Most recently have a look at ‘How to effectively target ROI instead of yield or growth’.
So why do we all build a 10-year cash flow for our investments?
The reality is, if we don’t look at the long term plan of a property we will target the wrong areas. Even if you have half the lowest growth for each area you are looking at, quarter the lowest rental growth and plan that into your cash flow you will really help yourself.
Using year one only, not planning in your other overheads, not looking at costs in years 2 and 3, and not planning on growth and inflation will stop your investments from being consistent.
Get a full cash flow on all over 4000 properties by giving one of our specialists a call at Baron & Cabot.
How to effectively target ROI instead of yield or growth.
Clients can often find ROI targeting a challenge. A lot of times we hear “I know the rent in year 1, we can’t know what it will be in year 4” and “I don’t want to factor in property price growth as we don’t know it”.
This is a highly logical argument but can focus your attention on absolutely the wrong properties. Let me tell you why.
First of all if you have not watched it have a look for our videos titled ‘How can I understand the future value of my property?’ and ‘The secret to always finding the best UK property investments.
What these videos should very quickly show you is how to practically, and safely predict the future growth of a property. What we always try to do with a client is agree to use the lowest growth of an area over the last 15 years if they hate using growth in their property choice.
So why do we push our clients to learn this?
One of the major issues you have with planning zero growth in property value or rent is that you will target areas that have historically performed the worst.
You will target the highest yielding properties because they will be the ones that work the best in your forecasts.
Contact Baron & Cabot and we can give you some examples of areas of England where we can show you how this works in practice historically. But take for example Bradford and Ancoats in Manchester.
15 years ago Ancoats was a run-down part of Manchester city centre but had a lot of investment coming in. The new tram line was being rolled out in Manchester and times were looking good.
Bradford, a great town near Leeds was a much higher yield and was around 20% cheaper. At this point, many clients who had a one year plan would naturally have bought there.
Don’t get me wrong, this would have made them money in the last 15 years. They will be pleased with the investment. But the person who looked at a 3 or 5 or 10-year plan would have bought in Ancoats, within 2 years their rental yield would have been higher than Bradford (and still growing) and their property value has tripled.
Not only that, the Ancoats buyer would have been able to refinance the growth of their property, thus meaning they may have also been able to buy 3 or 4 properties with the gains generated, without having to put any more of their money in.
At the same time, the Bradford buyers property has grown slowly in line with inflation.
The lesson here is even if you don’t want to buy on the basis of one area growing faster than another in the future. At very least look at the historical growth of each area you are looking at and factor the worst-case growth into your cash flow.
Also, as mentioned in previous videos. Don’t target a city, target smaller areas of cities.
Get in touch with a Baron & Cabot advisor who can share some of our data on historical examples, or give you charts on the areas you are looking at.
Why targeting as many bedrooms as possible is a terrible investment strategy
We have a lot of clients who, in their initial conversations with us suggest they want ‘as many bedrooms as they can’ for their budget. And this seems logical – right?
When you bought a home for yourself and your family you probably did the same, space is valuable.
Equally, if this is just a personal choice or specific strategy, our specialist will help you do this while giving you the stabilizers and boundaries to keep you protected in your choices.
So why is starting with the size of a property considered a poor strategy?
To look at this let’s take it to the extreme.
Why are you investing in the UK? Because it’s one of the lowest risk investments, with consistent returns. It continuously grows, there is a supply and demand issue pushing prices up.
If the size is important, there are much bigger available at your budget in another country. Equally, in England, while overall it performs exceptionally well on the world stage. There is of course areas with zero government investment, massive unemployment and very cheap property.
Even in the best cities, take Manchester as an example. Overall performing very well, but there are areas that are underprivileged and have property types that will not grow in value.
Never invest without undersupply, over demand, growing wealth and affordability in an area or you have a high chance of being burnt.
The point of all this is, this is an asset you are investing in. This is not your own home it’s your future money. Sometimes we have to forget that it has doors, windows or a roof. Take the emotion out and look at the numbers.
The most successful investors work off spreadsheets, not images.
You have to look at yourself and decide whether the number of rooms is an emotional decision or a financial one. If a 3 bed at the same price delivers a better return than a 1 bed, buy it.
Equally, if the 1 bed delivers more than the 2,3, or 4 bed over the period of time you are planning to own it for, that is the investment.
The final point to make on this is in reference to our video called ‘Are city centre properties the safest investments?’ which you can find on our website or by looking back in these videos. Sometimes getting into the safest and highest returning locations means you will have a smaller property than in the outskirts.
If this delivers more returns, with more occupancy, your life will likely feel a lot more relaxed!
Get more information by contacting one of our specialists at Baron & Cabot.
See also:
Why buying near a new transport link makes so much money.
Most investors know that if you buy a property and a new transport link subsequently opens your property price and rental price will increase steeply. There have even been reports on this for many cities across Europe by Lloyds bank which you can read if you have the interest give us an email for a copy.
But why do these properties increase in value?
Go back to the ‘basics of property investment’ videos, and ‘how to be consistent in property investment’ where you will see we covered the fundamentals.
The basics are, invest in areas with growing demand without enough supply, and growing wealth. So long as the area can get good mortgages we have ticked the basics, the non-negotiables.
Baron & Cabot know which areas are getting new transport links, and we want to know this because if an area has the above basic fundamentals of investment, then additional transport, means more people can commute to work, this means more people can live here creating more demand. Add to that a transport link will generally connect to the city centre where higher paid jobs are, we will also see higher affordability.
This cycles back into the fundamentals, and creates a faster and faster property price and rental growth.
Never invest without making sure you cover these basics
How to check if a city is saturated/ too many properties?
One of the biggest problems we have with UK investors is presuming a city or area is saturated because there is a lot more properties being built there compared to when they were younger.
We all have a habit of doing the same, properties ‘feel’ too expensive and there is too much. Its normal, this is why we invest in the UK, the market keeps growing and will continue to grow while people can afford them too.
For affordability, we check average price v’s average salary or gross disposable household income, but that is for another video!
So how can we check if there are too many properties? The best way is to check up on an area of the UK you need to get the postcode and go over to the government website – I have included the link below this video.
Here we want to see the ‘long term vacancy rates’ report (see report and article here). If a property is vacant in the UK you can get some discounts on council tax. When this happens the government will make a note of this property is vacant and we get copies of this each month.
By simply pulling a report of how many properties are in that area we can get a good idea of the % vacant at the moment.
The UK has always been a favourite for investors as there is a huge undersupply of property due to not being allowed to build on green belt land, and it taking a long time to get planning permission to build.
This means that many areas we target for investment have 1% or below vacancy rates. This would mean you will rent your property out for 99 months before seeing a month vacant.
Link to check Long Term Vacancy: https://www.gov.uk/government/statistical-data-sets/live-tables-on-dwelling-stock-including-vacants
Why you should use a mortgage instead of cash.
Most of us grew up with the ethos of buying property as our first investment, and if you are in Europe getting a mortgage and paying it off as soon as possible. After all, why should we pay interest on the money when we can clear it off.
With investment property, however, the solution is different. With a buy to let property, we look at lending like business leverage.
Imagine for a moment you have a mortgage that offers a deposit of 1/3. The property is worth £150,000 and you deposit £50,000 with the mortgage, paying the rest.
- Your tenant pays the rent which in turn pays off all your bills and the mortgage.
- Now not only is your mortgage being paid off, but you also have some income above that.
- Even better the average UK property grows at 4%.
If using some investment strategy we get 5% per annum, but have only invested 1/3 we get triple the returns, meaning we get 15% return on investment per annum before we even account for the rental income.
For more mortgage information including why all international clients can get a mortgage see our other videos linked below the video or on our website.
Why should I use a broker to buy my property?
It’s relatively straightforward to google properties in England, there are probably tens of thousands in each area of the UK. Using a bad broker is as bad as not using one at all, it makes very little sense in using a poor broker.
With a company like Baron & Cabot, you have to understand why the major funds, financial advisors and most experienced and largest investors in the world use us.
It is unusual for a client to have a data analytics team to source the best stock, a team in England trained in property for due diligence and an economy of scale to purchase at volumes which demand discounts.
We are working in property 24/7 meaning that we are hugely experienced in delivering consistent returns, if we couldn’t we wouldn’t have major investment firms working with us for years, 42% of properties bought by repeat investors and a global network of some of the most experienced staff.
We take a commission but it’s from the discount we get for you, this is why you should always speak to us before you make a decision. Our specialists will give you support and will never try and sell a property in the initial meetings.
How can I understand the future value of my property?
Accurately predicting the future value of UK property is something which Baron & Cabot have been recognised for many years. From our early days where we partnered with several UK universities to predict, through to now where we have advanced machine learning and AI systems and teams managing them.
Before you go out and hire 4 staff to start predicting property values there are some really simple first steps you can take, the same ones we do when we need to do a very quick prediction on a property we are looking at.
With UK property, like with people, looking at its history can give you most of what you need to know about a properties future.
The UK has so many investors because it is so transparent. Every single property sale is available, and Baron & Cabot have gone even further in having every transaction since 1995 and the size of every property.
We get these reports monthly, though as an individual you can log on to the website at the bottom of this website and very simply run a report of the last 15 years for the postcode you desire.
Download this to a spreadsheet and run a pivot table to group the average price by year.
From this point, we can quickly look at how much an area grew in value for the last 2 years, 5 years, 10 years and 15 years. For low risk take the lowest growth per annum and use this as your baseline.
After you have this growth figure you can make some judgements if it will grow above its lowest average with any of the growth factors in the video ‘How do I pick a property in England? / The secret to always finding the best UK property investments .
How do I know what the property will rent for?
Predicting future rental values are incremental to picking the right properties. Choosing 0% growth means you will target the wrong stock.
It’s tricky though, so why are Baron & Cabot so accurate in rental predictions, even years in advance.
At Baron & Cabot we have a management company responsible for all rental incomes, which means we have to get it right. Even when we predict 2 years in the future we are almost always banging on with our rental predictions!
But how can you do this yourself?
First of all, a sneaky way could be getting all the property information and calling around local management companies asking for what they would be able to rent the property out for (even if you haven’t bought the property yet).
Alternatively, if the property is completed look at comparable rents.
Finally, if you have not got any of this information you can look at rental properties in the area and 1 -2 miles around. If the property you are looking at is new then it will likely be in higher demand so focus only on new properties for rent.
We would always suggest speaking to a specialist though. Give us a call at Baron & Cabot and get some of the exact figures for rental numbers today and what to expect in the next few years.