Investment Advice

S

spoonbed

Guest
Great site, very informative.
Am looking to gauge peoples opinion.

I have reserved a 2bed appt here http://nirvanainternational.com/nirvana_main.php?menu_id=345 and also a 2bed at Tanjah beach, Morocco.

Still waiting for the developers to come good at Tanjah, but have now got to contract stage in Turkey.
I have not yet visited site( stupidly) , but will try to find time shortly. I ideally would like somewhere where there would be good growth, good rental return and an occasional break for me and the kids.
I initially was very keen on turkey but now feel slightly less positive.
What would be a realistic growth/occupancy rate for a development like Augustus?
 

Growth rates for both these developments will probably be negative in the first few years at least; of the two, Morocco would seem to be marginally better but not very exciting. Projects like these are priced well ahead of the local market and you have to wait for that to catch up.

Occupancy rates? How many renters can you find? Nobody is going to do it for you!
 
Thanks for taking the time Auto.

I certainly rushed headlong into these properties and now am starting to question my judgement.Maybe overseas property is not suited to myself.
 
Overseas property can be a great route to building up capital, and the entry levels and growth prospects are certainly far more attractive than the Irish market at this point.

However the way to make returns in the overseas market is generally to buy in growing markets (that usually means large cities with net inflow of population and rising incomes), and to buy at local prices. Buy the best you can afford in the best area you can afford, and let the renters pay some of the costs along the way. Be prepared for occasional downtime as well as repairs and maintenance. Also be prepared to drop rents and/or decorate in order to get tenants if the market is slow. If a property is not doing well, don't let it fester; find out the problem and sort it out. If it can't be sorted, get rid of it.

If you buy with care, and put a bit if time into being on top of the situation, you will generally get out with a decent margin in the medium to long term.

Occasionally, you will hit on a piece of property that other buyers have overlooked or not seen the potential in, and you will make spectacular gains in the short term; these are the exceptions rather than the rule however. One thing is very sure about this kind of windfall gain, you won't find it at a property exhibition or from a salesman in a McA office.

Buy good property from agents that you trust and where you know that they won't sell you the rubbish. Stay away from the big mass-market outfits in other words, you are just cannon fodder to them.
 
auto320 said:
However the way to make returns in the overseas market is generally to buy in growing markets (that usually means large cities with net inflow of population and rising incomes), and to buy at local prices.
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I am now starting to think that once complete novices like me and the lady in the local corner shop lump their monies into overseas property, then perhaps would be a good sign that things are getting a bit daft in much the same way that BTL has in the UK.

The trouble is that it is really easy to get carried away with the hype and excitement of it all.
Perhaps the best investment i could make would be to pay off my mortgage?
 
You need to think long and hard about buying abroad as there are a lot of added expenses and I know from personal experience.

1) Stage payments - When it's not Euro every stage payment can cost more than you originally thought ( one of my payments was to cost €12,000 but because of exchange rates changing it cost €13,800) and you also pay the bank charges here and in the country your buying in for every stage and there are usually 6 or 7.

2) Changes in the law - When I originally paid the deposit for my apartment, there was no stamp duty on new builds, but by the time construction was completed the law have changed and I had to pay €2,500 approx that I hadn't planned for.

3) Fit Out Costs - I was originally quoted €4,000 - €5000 to fit out my apartment but because the building wasn't finished for 2 years the fit out finally cost me nearly €10,000.

4) Expenses - Now I have my apartment there are a lot of running costs associated with it when it's not rented out ie electricity (you still get a bill even if no-one is living there) water, heating in the winter months so I don't get burst pipes, maintainence, management fees, insurance on the building and contents, accountant for taxes payable both abroad and in Ireland.

I'm sure there are more things that I can't think of at present, but this is just to let you know how much extra it can cost to have your place in the sun.
 
As JFK's Daddy said, when they shoe shine boy is is giving stock tips it's time to sell...

or in this case not to buy
 
I have heard some mixed reports on the Tanjah development in Morocco. When you say you are waiting for the developers to come good, what do you mean?
 
I was one of the investors on the 1st inspection trip in november.Dreamworld( the main agent/developer) on that showing, couldnt organise the proverbial.
Apparently contracts are imminent and i'm waiting to see whats on offer.
 
Hi Spoonbed,

i also bought in Augustus Villiage, Apt 216, through Viceroy Invest.

That was Sept 05 and I paid €62,000 for a 2 bed. It was a genuine 20% discount on the developers prices and I was taking a risk on a unknown developer but I have to say that Nirvana have so far been the best developer I have ever used. They have improved on the development since I bought and at no extra cost. They also keep you well informed on what is happening and expected completion dates. And believe me that is not common.

I intend to sell on completion and take any profit I get. I don't believe in holiday lets, there way to much hassle.

Good Luck with yours

Johnny
 


I remember looking at Viceroys site when we started looking at Augustus to get an idea of early prices.Was a bit gutted to see that we missed out big time.Our purchase price was 110,000euros for a Fuschia 2 bed.Great looking site and as you say Nirvana and Melanie have been a dream to deal with.BUT after all that i still feel that it is unlikely i will procede.If i would have got in early like you, it is possible to see that you will hopefully make a few quid, but due to my higher purchase price cannot see me being able to sell on completion for anything other than a loss.A further consideration was then being able to use as a holiday home, but with flight times of 6 hours or so, felt that it was not practicle for short trips such as long weekends etc
 
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