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Property based funds

  • 20-03-2006 11:31am
    #1
    m_stan
    Registered Users, Registered Users 2 Posts: 1,653 ✭✭✭


    Very interesting discussion between George Hook and Eddie Hobbs on Newstalk 106last week. Basically Eddie Hobbs was questioning the sanity of people buying property - particularly overseas properties.

    He was recommending property based funds or stock portfolios over individuals investing in their own properties.

    Anyone have an experience of these funds and what the growth rates have been like over the last 10 years relative to property price inflation in Ireland ?


Comments

  • #2
    daveirl
    Closed Accounts Posts: 14,483 ✭✭✭✭daveirl


    This post has been deleted.


  • #3
    m_stan
    Registered Users, Registered Users 2 Posts: 1,653 ✭✭✭m_stan


    he declared that from the start (actually Hooky pointed it out). He was more talking about people who were investing in markets they had no idea about. He gave an example of people investing in property that didnt even know what the European base rate was. He also said that people on the average industrial wage paying more than 30% of their current salary on an exsiting mortgage and taking on an investent property needed their heads checked. All valid points I believe.

    Yeah saw the rabo stuff. Just wondered if anyone had any direct experience.

    Seems to me it might be a safer and reduced hassle way of getting into the property game indirectly.


  • #4
    grumpytrousers
    Registered Users, Registered Users 2 Posts: 1,884 ✭✭✭grumpytrousers


    m_stan wrote:
    Very interesting discussion between George Hook and Eddie Hobbs on Newstalk 106last week. Basically Eddie Hobbs was questioning the sanity of people buying property - particularly overseas properties.

    He was recommending property based funds or stock portfolios over individuals investing in their own properties.

    Anyone have an experience of these funds and what the growth rates have been like over the last 10 years relative to property price inflation in Ireland ?
    Don't have personal knowledge of them, but the old lady stashed a few bob into one provided by Standard Life where your wonga is put into retail outlets in the UK...specifically, I think, Chelsea, Kensington and a bit of Oxford/Regent St.

    After one year, the return was pretty impressive altho' the money's locked in for a few years yet, and as any fule kno, the return isn't real until it's in your hand. Like any other investment, it's a gamble. It's possible that the demand of stores to be based in prime retail streets way wane, but unlikely...

    (rate of appreciation over 1 year seemed to be, if memory serves over 15%)


  • #5
    ronbyrne2005
    Closed Accounts Posts: 3,494 ✭✭✭ronbyrne2005


    the thing is when you get a mortgage to buy a property you are leveraging your investment(and risk),if you want similar returns from a fund make sure its a leveraged/geared fund.


  • #6
    Coney Island
    Closed Accounts Posts: 344 ✭✭Coney Island


    I have bought several Henderson funds with Rabo Bank and they are going up and up. I am very happy with it. Check here:http://www.rabodirect.ie/investments/fund_details/selection_ratings.asp


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  • #7
    m_stan
    Registered Users, Registered Users 2 Posts: 1,653 ✭✭✭m_stan


    Coney Island wrote:
    I have bought several Henderson funds with Rabo Bank and they are going up and up. I am very happy with it. Check here:http://www.rabodirect.ie/investments/fund_details/selection_ratings.asp

    great. from what I can see the only charges are .75% on entry and .75% on exit, which according to my sums is Eur 75 for every 10k in and out. Can you confirm, and also indicate what minimum term your funds are for and what notice you need to provide to exit ?

    thanks


  • #8
    Coney Island
    Closed Accounts Posts: 344 ✭✭Coney Island


    m_stan wrote:
    great. from what I can see the only charges are .75% on entry and .75% on exit, which according to my sums is Eur 75 for every 10k in and out. Can you confirm, and also indicate what minimum term your funds are for and what notice you need to provide to exit ?

    thanks

    You are correct. Then sometimes there are special offers where they only charge 0.25%, for example I recently bought 1,000 Euro of ML Latin American funds and they only charged me 2.5 Euro. I believe this offer is on until the end of March, but you should check on the website.

    I started only a month ago, so I never sold a fund (I have 3 different and they are all going up), but if I remember I think they sell the funds straight away, but again I am not sure. Anyway as the funds cover across several markets, the risk is well spread, so you should not encounter too much urgency to sell a fund immediately worrying for a sudden price drop as it could happen with shares.


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