Buying Investment Property in City of London

Buying Investment Property

Buying Investment Property in City of London?

Looking to buy investment property in City of London? It’s a sound choice, yet one that must be executed correctly. This article tells you about buying investment property in City of London, the types of deals available and the likely returns. Remember, buying property in City of London has, on average, yielded in excess of 8% returns per year, and significant capital asset growth.

Property Investors in City of London have received a lot of Government and economic support. Much of this support has come indirectly in the form of the lowest interest rates in history. This has been bad news for savers, but of course good news for those buying investment property in City of London using mortgages.

Buying investment property in City of London with cash outright is also a sure fire hedge against any rise in interest rates. Some investors look to buy properties in need of renovation or a change of purpose. They then renovate those properties and rent them out on a long term or short terms basis.

Once these properties have been renovated and rented then investors in City of London may refinance the property by taking a mortgage over the property at a higher value, using the income to pay the mortgage and reinvesting the profit from the deal into more property in City of London or elsewhere.

How easy is it to make money from buying investment property in City of London?

Guess what? It may be unsuprising to learn that this model is an absolute pain the backside for potential property entrepreneurs in City of London.

Which properties in City of London should you buy? What areas of the City of London housing market are going to give the best returns? Do you know the planning application process with the council? Or about the change of use regulations?

The question you have to ask your self about buying investment property in City of London is how hands on you want to be?

If you want a new career as a developer or property project manager then go for it.

If, like thousands of other investors you simply want to take advantage of the UK property market, and earn more than the poxy interest rates available from the so-called people’s banks on the City of London High Street then there are many investment funds, not readily available to the general public.

If you want a new career as a developer or property project manager then go for it.

If, like thousands of other investors you simply want to take advantage of the UK property market, and earn more than the poxy interest rates available from the so-called people’s banks on the City of London High Street then there are many investment funds, not readily available to the general public.

Map of City of London

The City of London is a city, ceremonial county and local government district that contains the historic centre and constitutes, alongside Canary Wharf, the primary central business district (CBD) of London. It constituted most of London from its settlement by the Romans in the 1st century AD to the Middle Ages, but the modern area named London has since grown far beyond the City of London boundary. The City is now only a small part of the metropolis of Greater London, though it remains a notable part of central London. Administratively, the City of London is not one of the London boroughs, a status reserved for the other 32 districts (including Greater London’s only other city, the City of Westminster). It is also a separate ceremonial county, being an enclave surrounded by Greater London, and is the smallest ceremonial county in the United Kingdom.

The City of London is widely referred to simply as the City (differentiated from the phrase “the city of London” by capitalising City) and known as the Square Mile, as it is 1.12 sq mi (716.80 acres; 2.90 km) in area. Both of these terms are also often used as metonyms for the United Kingdom’s trading and financial services industries, which continue a notable history of being largely based in the City. The name London is now ordinarily used for a far wider area than just the city. London most often denotes the sprawling London metropolis, or the 32 Greater London boroughs, in addition to the City of London itself. This wider usage of London is documented as well-established in 1864, and the case of Lord Henry Seymour’s Will.

The local authority for the City, namely the City of London Corporation, is unique in the UK and has some unusual responsibilities for a local council, such as being the police authority. It is also unusual in having responsibilities and ownerships beyond its boundaries. The corporation is headed by the Lord Mayor of the City of London (an office separate from, and much older than, the Mayor of London). The Lord Mayor, as of November 2021, is Vincent Keaveny. The City is made up of 25 wards, with administration at the historic Guildhall. Other historic sites include St Paul’s Cathedral, Royal Exchange, Mansion House, Old Bailey, and Smithfield Market. Although not within the City, the adjacent Tower of London is part of its old defensive perimeter. The City has responsibility for five bridges in its capacity as trustee of the Bridge House Estates: Blackfriars Bridge, Millennium Bridge, Southwark Bridge, London Bridge and Tower Bridge.

The City is a major business and financial centre, and the Bank of England is headquartered in the city. Throughout the 19th century, the City was the world’s primary business centre, and it continues to be a major meeting point for businesses. London came second (after New York) in the Global Financial Centres Index, published in 2022. The insurance industry is located in the eastern side of the city, around Lloyd’s building. Since about the 1980s, a secondary financial district has existed outside the city, at Canary Wharf, 2.5 miles (4 km) to the east.

The City has a resident population of 9,401 (ONS estimate, mid-2016) but over 500,000 are employed there, and some estimates put the number of workers in the City to be over 1 million. About three-quarters of the jobs in the City of London are in the financial, professional, and associated business services sectors. The legal profession forms a major component of the northern and western sides of the City, especially in the Temple and Chancery Lane areas where the Inns of Court are located, of which two—Inner Temple and Middle Temple—fall within the City of London boundary.

What are Property investment funds

These funds are hidden in plain sight. A global network of nods and handshakes at the Rotary club or on the Golf Course. Some people refer to these private investment vehicles as hedge funds or REITS. However, they are not. These are the funds that wealthy individuals and families invest in to get richer.

The barrier to entry to these exclusive clubs is around £50,000 although do remember that these private investor funds have collectively trillions of dollars under management.

And no, these funds are not available at the bank in City of London, nor are they covered by the FCA. Your IFA or Accountant won’t bring you the opportunities because of course they won’t receive their greasy commissions.

Investment funds are not even allowed to advertise so you’ll never hear of them unless a friend recommends them.

If you don’t know about these firms, and opportunities then these investments aren’t for you.  You will need at least some experience with previous investments to be eligible and of course they are extremely picky about the investors they accept. They can afford to be. They don’t need your money, but they can put your money to work for you like never before.

Some of these funds don’t invest in property at all. You’ll know them as hedge funds. However, there are a considerable number of Asset backed Investment vehicles delivering significant income and long term growth.

Top three international investment properties realtors in the UK and City of London

Physis Realty

Apollo Asset Management

The Carlyle Group

Is buying property investment in City of London a good idea?

The top three actively managed funds directly significant offshore funds into the UK market seem to think so. Of course there’s much speculation about whether rates will rise and the uncertainty around buying property investment in City of London. One fact remains often overlooked though, during the frantic and heated investment discussions around the dining tables of City of London

Many individuals and families in City of London want a safer, long term investment. They realize that property is a relatively illiquid investment and they simple was a property secured investment that provides a nice balance of income and capital appreciation.

Many people looking at buying investment property in City of London have plenty of business and investment initiatives already in play, whether it be in City of London, further afield or in a safer offshore investment fund.

Types of investment property in City of London

It is important to understand the main types of property investment in City of London

  • Undeveloped land in City of London
  • Greenbelt land in City of London (speculative investment)
  • Brownfield land around City of London (and apply for planning)
  • Commercial property in City of London
  • Direct Booking Vacation rentals in City of London
  • Residential real estate property in City of London
  • Operating property investment in City of London
  • Distressed property investment in City of London

Types of property investment deals in City of London

The main types of property deals in City of London are:

  • Buy to let in City of London
  • Buy to hold
  • Serviced Accommodation in City of London
  • Old Peoples Homes
  • Car Parks
  • Commercial Property in City of London
  • Buy to change purpose

Buy to let in City of London

A buy-to-let mortgage is a mortgage loan designed specifically for this purpose. Buy-to-let is the process of buying an investment property in City of London that is specifically let and is one of the most common types of mortgage in the UK and many other countries. Obviously buy-to-let in City of London does not have to be done with a mortgage and the sector does attract a significant number of cash buyers.

The purchase – to – rental of real estate is usually a residential property in City of London, but some terms also include a small number of commercial properties, such as office space and retail space. As with a lease, the benefits of buying a rental property in City of London as a landlord can include the ability to build up assets as house prices rise over time, as well as the benefit of a low interest rate.

The main risk is that a landlord may borrow to buy the property in City of London, expecting the house to be sold at a higher price later, or that rental income will cover or exceed the cost of the loan.

Once the price has fallen, this lever could push the landlord into negative equity and, if he cannot meet the terms of his mortgage repayment, the bank will try to take possession of the property and sell it to get the money he borrowed. Banks in City of London can lend to both landlords and tenants, suggesting that the capital is being used for investment rather than rental income, as a professional investor might do.

Buy to hold in City of London

Long-term rental property in City of London is widely considered one of the best ways to diversify your property portfolio. So buying and owning property means much more than just investing in a single property, it can bring you a variety of benefits, such as access to a variety of investment opportunities and the benefits of long-term ownership.

While some investors in City of London may be confused or intimidated when they start, buying and owning property can be one of the best investments you can make if you do your due diligence before you start.

Buying and owning real estate is an investment strategy for investors in City of London who buy and hold real estate over a long period of time. The owner usually intends to sell the property later, but leaves it to you to help you buy or finance it.

The rental income from the property in City of London generates short-term income that can be used to pay off a mortgage or to invest money. The strategy of buying and holding property is one of the most common investment options.

The value of the City of London property will increase over time and the investor will benefit if he is willing to sell it later. The investor benefits from being bought in the expectation that the value of the property will rise over time.

Investors considering a City of London property purchase and holding strategy should do their best to calculate the potential income from renting out the property. The bottom line is that monthly income should exceed the cost of rent in the first year of ownership and annual rental income over the next five years.

If the investor plans to sell the City of London  property later, possible profits should also be taken into account. Finally, any losses from taking out a mortgage or other type of property financing must be taken into account, as well as any gains from the sale.

Convert City of London property to Serviced Accommodation

For property investors in City of London, converting a home into a serviced apartment would mean higher rents than the normal rent increase. As a result, many people are buying investment property in City of London and then converting these homes into serviced apartments to maximize yield.

The types of property used for serviced accommodation in City of London are often the same as those you would use to buy to let. Where you have a guaranteed short-term rent, it’s not as rigid as renting out a property.

Disadvantages of investing in Serviced Accommodation in City of London

  • Serviced accommodation is more of a business strategy than a property strategy, and the workload is far more intensive. Seasoned veterans liken serviced accommodation investing in City of London to the same as running a traditional bed and breakfast. It’s no surprise that the other name for City of London serviced accommodation is a holiday let.
  • You’ll need to furnish your serviced accommodation in City of London
  • You’ll need to clean the rooms and change the sheets every time your guests leave.
  • Who does all the laundry?
  • Who does all the cleaning?
  • Who’s going to do all the work for you?
  • How are the guests actually going to get in?
  • Massive Payments to Online Travel Agents
  • Are you going to have somebody to do a meet and greet?

Buying investment property in City of London to convert into serviced accommodation or holiday lets is not really considered an investment, because the amount of work involved make it a full time job.

Buying Investment Property

Buying Investment Property in City of London