€30,000 to invest property?

cosher10

Hi,

i have saved up €30,000 over the last 8 years. i dont own or rent a house so dont have many over heads. would anybody have any advice on what to do with it. im wondering is the property market at its lowest and maybe i could invest in something even commercial or residential but i will not just buy something to 'get on the ladder'

Just looking for a conversation on this and some ideas i can research in.

thanks

JOSman

Property generally hasn't bottomed out but values at the lower range has. €30,000 will not buy very much but if it does let me know as I'm in the same position as you.

Hope you get something.

J

cosher10

hi,

yes i kind of thought it wouldnt get me anything but was just thinking ig there was something that could be an investment for under 100k i could get a loan. Im just interested in knowing if there are things out there at cheaper price with potential.

francomcdaddy

From what I looked at the governments saving bonds from the post office give the best return.

Pawwed Rig

In some of the country towns you could get a good 3 bed for about 100K . Renting to social welfare tenant would get you €500 per month. However I would not recommend this course of action at the moment as the prices are still falling and there are so many fixed costs eating into lower end investment properties that it might not be worthwhile (things like NPPR/PRTB/Property Tax as a proportion of gross income). Plus to replace a washing machine costs the same if you are getting €500 per month or €1500 per month.

I am hearing rumblings about REIT's here (real estate investment trusts) so they might be worth a look in the next couple of years depending on the detail.

collie0708

Using you hard earned cash to buy an investment property before you even own your own home seems like a bad idea with the instability in the property market.

Grecco

What you could do is move to a middle or low-income country.
Heres a LINK (Also its usually the poorer the country the nicer the people )
Buy the best property you can for the money;
Then wait for arbitrage.

dzer2

That would have got you a 2 bedroom house half a mile out of town around here last year.

bridgepeople

My advice would be to put your money on the best deposit rate for the time being and wait for NAMA to introduce its REIT over the next year. That will allow you to invest into a (relatively) low cost fund with many other investors which will be diversified across many properties. The management of the properties is taken care of by professionals and you can sell out of the fund at any time without hassle. No details yet on what the annual yield will be but I expect it to be around 7% or so initially.

Villa05

bridgepeople wrote: »

My advice would be to put your money on the best deposit rate for the time being and wait for NAMA to introduce its REIT over the next year. That will allow you to invest into a (relatively) low cost fund with many other investors which will be diversified across many properties. The management of the properties is taken care of by professionals and you can sell out of the fund at any time without hassle. No details yet on what the annual yield will be but I expect it to be around 7% or so initially.

Diversified? In ireland
Armagh house for sale 3 bed, was getting 400 sterling rent in 2002 for sale for 25k. Prices in d republic r deluded

bridgepeople

By diversifed, I mean the REIT will have hundreds if not thousands of properties in the portfolio.

Of course it would make sense to diversify by country and asset class too, but this post seemed to be aimed more at investing in Irish property. With €30,000 to spend, I think it makes sense to invest that in a fund rather than buy up a single, low-quality property.

srsly78

NAMA selling 2 bed apartments in waterford for e25k.

Villa05

bridgepeople wrote: »

By diversifed, I mean the REIT will have hundreds if not thousands of properties in the portfolio.

Of course it would make sense to diversify by country and asset class too, but this post seemed to be aimed more at investing in Irish property. With €30,000 to spend, I think it makes sense to invest that in a fund rather than buy up a single, low-quality property.

I disagree, the management charges are extortionate. The majority of the property will be in the republic of Ireland and probably rubbish they could not sell on the open market, exposing you to pyrite, poor planning, property on flood plains, property in areas of low/nil demand

cosher10

Thanks for the replies very interesting think i will wait for a while the reason i have not got my own property yet is because i am waiting for something specific in an area. Has anybody got any good experiences with buying overseas properties. or is it a very dangerous game. keep up the discussion very interesting.

cheers

[Jackass]

http://www.daft.ie/searchsale.daft?id=703069

Boom. There you go. Nice 2 bed city centre apartment, 126k - EUR1,050 a month rent from current tenant - a 10% annual yield - mortgage would cost you about EUR350 per month (if you sink whole 30k into it - calculated here ) - you'll increase your monthly income by 700 euro and if you sink that back in you'll pay off the mortgage in about 10 - 15 years, depending on how much you commit to it, then you'll have a nice city centre apartment, extremely rentable, debt free and income for life.

All of this assuming you can't negotiate the price down significantly and get an even better deal.

srsly78

Assuming no management fees and not paying any tax - ie not a realistic calculation. The agent themselves advertises a 10% yield so you know they are lying!

[Jackass]

Well I'm not his accountant or financial advisor, just giving him an example, not drawing up the paper work, but you get the idea of what I'm suggesting.

Regarding the yield, I'd imagine it's accurate as obviously it will be awkward when you ask for evidence of the rent and they have no conformation from tennant or lease. I'd also have an extended lease as a condition of purchase.

The 10 - 15 year estimate is pretty accurate I would suggest though.

cosher10

ha that is pretty impressive alright i have to say there must be a catch seems incredibly good with a tenent etc.

[Jackass] wrote: »

http://www.daft.ie/searchsale.daft?id=703069

Boom. There you go. Nice 2 bed city centre apartment, 126k - EUR1,050 a month rent from current tenant - a 10% annual yield - mortgage would cost you about EUR350 per month (if you sink whole 30k into it - calculated here ) - you'll increase your monthly income by 700 euro and if you sink that back in you'll pay off the mortgage in about 10 - 15 years, depending on how much you commit to it, then you'll have a nice city centre apartment, extremely rentable, debt free and income for life.

All of this assuming you can't negotiate the price down significantly and get an even better deal.

Pawwed Rig

Looks like the yield is coming from 1050x12= €12,600/Cost price = 10%.
No account is taken of management fees, NPPR, property tax. Management fees look to be on the high side.
No parking space is the glaring issue with this place. Otherwise does not look like a bad deal

[Jackass]

Yeah I wouldn't say that one property specifically, you could do a lot worse than that deal, but that was just the first one I pulled from a 30 second search on Daft, if you shop around I'm sure there are several great deals out there, better than this one perhaps.

Parking space is an omission alright, but you'd have to assume that's factored into the asking price.

Yield and potential for maximum occupancy would be the two main factors I would look for in assessing these investments. At 10% and high possibility that you could keep it rented most of the time if not all the time, if I was the OP I'd certainly consider this one, but would look around some more to see what else is out there.

Low Energy Eng

10% yield with a 10%depreciation rate. Go for it.

You could stick some of it in indirect property and some in stocks
Better than throwing it away on one single thing, assuming you do your research