Investment Property
Overseas
The concept of purchasing investment property off-plan is actually the same the world over. There is usually growth in the price of the property during the construction period and this is simply down to the fact that the market for purchasers is opened up as the finished product is released.
Stirling Mortimer negotiates the keenest deposit levels, usually 30 - 50%, and obtain(s) “right to purchase” (RTP) contracts. These are tradable and Stirling Mortimer via the Property Manager looks to sell them prior to the completion of the property and return the profit to investors. Stirling Mortimer also look to purchase completed property with the optimum rental yields allied to capital growth.
Having the ability to approach the property market from both angles allows Stirling Mortimer to offer the potential of significant returns to investors.
UK
Given the current economic climate, developers and land owners are facing acute cash flow shortfalls resulting from the lack of banks providing development finance and mortgage lending. Stirling Mortimer by virtue of its buying power is being offered land opportunities heavily discounted to the current RICS red book valuation. All the land benefits from at least outline planning and this will enable quicker re-sales as opposed to trying to gain an approval over time. In some cases the seller is requesting the option to re-purchase the land from the Fund at the full asking price at a fixed future date.
The aim is to buy low and then re-sell at nearer the market value either immediately or in the medium term. Development is essential to meet not only the Government target of three million new homes by 2020 but also the general consumer demand. The land will be owned from outset with no borrowing requirement and the Fund will not look to develop the sites itself merely profit from the cash flow pressures being experienced in the building/development sector.
Following the huge success of the Stirling Mortimer No 8 UK Land Fund we aim to launch a second such Fund early in 2010.
