In Search of Decent Yields...

A

Apsil

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Hello All,

I've been trawling these boards trying to find anyone who has found decent (4%+) yields anywhere. I'd prefer to invest in lower risk geographies such as UK, USA, Continental Europe (note I say "lower risk", I realise there are bubbles everywhere in property at the moment!).

Has anyone experience or solid research on where the yields are hiding?

(Please - no ego-driven smart responses to this request, I've noticed an increase in them on other topics recently - maybe it's the weather ;) )

Thanks,
 
I'd say that 4% is not really a very decent return at all. Couldn't you get that in Ireland? Depends on your budget I guess.
 
try ETF based on certain sub-sectors. Utilities, tobacco, and banking shares tend to produce decent yields. Last time I looked the FTSE Eurotop Utilities subsector was yielding over 6%. Higher yields can be achieved by buying certain individual shares but this obviously increases the risk.
 
Thanks Johnboy - I'm actually focused on yields from property. Obviously I'd prefer something north of 7% but I'm keen to open up the discussion to all with ideas. It seems it may be possible to get above 5% in Germany for example.
 
Speaking from my own experience it is definitely possible to get 7% + on investments in Romania but you will need to research it thoroughly and not rush to any decisions. Your best bet will be in commercial properties IMHO. Visit the place and have a look around.

That aside I'm sure that there are such deals available in any number of European destinations if you do your homework.

Like I said, don't rush into anything too quickly and ALWAYS visit before you buy.
 
We were just discussing Scandinavia on another thread - I reckon there are a lot of properties in Scandinavia yielding 6%+, and you'll definitely get that in Finland
 
it is not just locations but certain types of properties that can produce good yields. A friend of mine has bought some newly renovated houses in places like Hull in the UK and is generating a yiled of over 7% which is not too shabby in today's worl of pumped upped property prices. he is focusing on Homes of Multiple Occupancy (HMOs) - houses that have been renovated to add another bedroom so that a 4 bed house becomes a 5 bed etc.

IMHO, however, property is one of the more overvalued asset classes around and 'value' is nigh on impossible to find no matter where you are looking.
 
Thanks Guys, San Martino - Finland does sound interesting (from that thread).

Please keep the ideas coming. Any other suggestions on the UK for example?
 
Judging by my friends experiences in Essex and East Anglia recently then this seems a good region to invest in.

He has just sold a 2 bed, one bathroom in Chelmsford for 50% more than he bought it for in less than 2 years.

He's moving up to Suffolk, near Bury St. Edmunds, with a view to repeating the exercise and coming back to Essex in 2 years time loaded!
 
Ancutza said:
Judging by my friends experiences in Essex and East Anglia recently then this seems a good region to invest in.

He has just sold a 2 bed, one bathroom in Chelmsford for 50% more than he bought it for in less than 2 years.

He's moving up to Suffolk, near Bury St. Edmunds, with a view to repeating the exercise and coming back to Essex in 2 years time loaded!
Click to expand...

A lot of this was one off as Canary Wharf took off in 2004 again after recession with losts of new financial services jobs and a few city banks moved their whole operations out to Canary Wharf.

IMO even with that your friends are clearly astute purchasers to have made 50%. Think that last 2 years above 20% was great, 25% excellent and 50% astounding relative to the market.
 
Ancutza said:
He has just sold a 2 bed, one bathroom in Chelmsford for 50% more than he bought it for in less than 2 years.
Click to expand...

Do you know the actual price of the property when it was purchased and the price realised?

What research did your friend do and what was the cost of this research?

What were the costs associated with the acquisition?

What did it cost to maintain the property for the two years?

What were the costs of advertising and selling the property?

How much of your friends time and effort went into the purchase,maintenance and sale of the property?

How much Capital Gains Tax did they pay?
 
Point taken Fred.

I know that my mate DID do some extensive improvements to the house, e.g . re-did the bathroom, changed the stairs, all the windows and doors (internal and external) plus landscaped the garden, so yes he spent quite a bit on it.
 
That's the problem with the inflated 'profits' and 'yields' that are put forward in the purchasing of property abroad (or here).

When you apply all the additional costs, it's not what it seems.

Good way of disjointing your friends noses though.
 
Apsil said:
Hello All,

I've been trawling these boards trying to find anyone who has found decent (4%+) yields anywhere. I'd prefer to invest in lower risk geographies such as UK, USA, Continental Europe (note I say "lower risk", I realise there are bubbles everywhere in property at the moment!).

Has anyone experience or solid research on where the yields are hiding?

(Please - no ego-driven smart responses to this request, I've noticed an increase in them on other topics recently - maybe it's the weather ;) )

Thanks,
Click to expand...

Germany 6 to 7% yields. (only particular cities...exclude Berlin and former East). No housing bubble. Complicated process to buy and german tenancy rules complicated but good prospectives for a recovery and thus capital appreciation.
 
If you are looking for (almost) risk-free 4% yields, stick the money in Rabobank or Northern Rock and save yourself a lot of time, hassle, grief, gnashing of teeth, stress, paperwork, advisers, lawyers, taxmen, estate agents, banks, loans, documentation, form-filling, files, phone calls, emails, buying costs, selling costs, ongoing costs, tenant-less periods, travel, flights, sleepless nights etc. Use the time you save to take a holiday with your loved ones.

And I'm not being smart, I'm being quite serious.
 
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