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Joint Equity the alternative route to home ownership and property investment
There are three ways to invest in residential property in the UK, direct and indirect.
- Buy to Let
- Residential Investment Funds
- Joint Equity
► Buy to Let. The traditional method is to buy a property fairly close to where you live and then rent it out either using a local estate agent or manage it yourself.
Whichever way you choose to manage it it will be a problem, Agents have a dreadful
reputation for ripping off landlords with high maintenance charges often completed
by their family or close friends. There is always the implication of back-
Estate agents now charge for everything; 10% of the annual rent as a fee, £75 for the Short Term Tenancy Agreement, £125 for the compulsory inventory, you name it if they do it or can require the landlord to have it done they will do it and charge.
Then there is the Government who seem to overtly on the tenants side and add obligations and responsibilities on the landlord annually. Over the last few years there have been the appliance testing obligations, energy efficiency requirements, Energy Performance Certificate and the infamous deposit protection scheme. Now they have said that all residential landlords will need to registered as “fit and proper” before being able to let any property out.
And we have not even considered the horror stories about the tenants themselves. Non payment of rent, fraud, blackmail when trying to evict, damage, dirt, but don’t just take our word for it read it from the landlord’s own association and an information site. Read the Times article about agents going bust with the deposit money and landlords still being responsible for repaying the tenants deposit.
Then you have rental voids between lets, which are getting longer, falling rents, income that will not cover the mortgage, falling yields and the inability to source alternative mortgages when the discount period ends. Many landlords now report that they are losing money each money and are relying of capital growth to eventually make a profit.
All in all a sorry state it really does make you wonder why we do it?
Joint Equity Ltd works with Mortgage Beaters Ltd to provide case studies & Illustrations to prospective Owner-
The content of this website is accurate to the best of our knowledge and for information only. We do not provide financial advice.
► Residential investment funds These break down into 2 primary sub sets
The Open Ended Investment Company (OEICs) structure such as Jersey based Gartland Asset Management where they buy, renovate and sell properties combined with traditional renting. They are usually geographically focused.
One problem they all have is that the costs are high, set up is around 4% and annual fees of 5% are not unusual. The problem is also that the managers can suspend payouts whenever there excess demands for withdrawal.
The Investment Index Fund is a derivative product that tracks a housing index, often the Halifax. An example is the Alpha Beta Fund Management offering.
As a derivative this product is only suitable for expert investors and after the 08/09 banking crisis many think derivatives are too complex and risky even for “experts”.
► Joint Equity Offers a no hassle, secure easy to understand ethical alternatives to both the previous methods of investing in residential property.
Joint Equity is ethical because simply put when the Investor makes money so does the occupier, who is also able to buy their own home which they would not be able to do without Joint Equity.
Personal Investment We have seen through the Joint Equity main site how Joint Equity
returns 6%pa income plus 50% more Return on Investment (ROI) than Buy-
Evan more, Joint Equity has no voids, damage costs or tenants to worry about.
So we knock out the Buy to Let option on the grounds of higher returns, no hassle and ethical.
Now we have added Joint Equity Investment Partnerships, JEIPs, that allow investors to put cash into a number of investments and take a back seat as someone else does the management. More
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