Big Discounts With Property Investment Clubs?

A stagnant stock market, low interest rates and booming property prices over recent years have lead to more and more personal investors deciding to join property investment clubs.

Property investment clubs are organisations that either buy property in volume and resell it to their members at discount prices or negotiate the purchase of large numbers of properties from developers, again ensuring discounted prices. Clients can often expect to make savings of up to 25% of the property's market value.

Additional services from property investment clubs vary, with some offering financial and legal assistance, along with local property market research. Volume purchases can enable discounts on mortgages, solicitors, letting and estate agents fees.

For the personal investor with limited property investment experience, these organisations offer an easier entry into the market and the opportunity to generate significant equity from the original savings. For example a property valued at £100,000 could be purchased for £75,000. Selling that property at market value would generate a profit of £25,000 minus fees.

Club fees

Property investment clubs tend to make their money either by charging an acquisition fee of around 2 or 3% per property purchased or they charge members an annual membership and take an agency fee from the developer.

Choosing an investment club

As with any investment, buyers should do their homework before deciding to invest and ensure they are dealing with a reputable organisation.

A large amount of property offered by clubs is off-plan. This is where you buy a property before it has been built and hope that by getting in early you secure a bargain before selling at profit when the property is ready for market.

This practice works best when house prices are rising, but when the market is slower, you run the risk of the property dropping in value and by the time it is built, it could be worth less than you paid for it.

There have also been a few cases of unscrupulous organisations selling off-plan property, with no intention of developing it.

Again proper research will help to ensure you choose a reputable company. Be prepared to ask questions about the potential sale value, rental value, quality of the workmanship and the company' credentials. A good club will be able to provide you with this sort of information.

It is also worth trying to get in touch with other club members, particularly those who have already purchased properties, to find out about their experiences.

Setting up your own club

In addition to professional investment clubs, many friends, families and colleagues are beginning to set up their own syndicates, then pooling resources to secure bulk discounts and spread their risk. Often a small number of individuals within the syndicate will act as asset managers, researching the market to find the best opportunities and advising others within the group.

Don Suter is Managing Editor of the UK Property Portal (http://www.ukpropertyportal.co.uk), an online directory and magazine for UK property sales, rental, surveyors, mortgages, conveyancing, property insurance, removals, news, investment and development

---

Real Estate Business

Starting real estate business is not that simple. Multiple aspects... Read More

An Overview of Easements

Title insurance is generally associated with insuring a purchaser's or... Read More

Sell Your California Home For Top Dollar

HOW TO SELL YOUR HOME FOR TOP DOLLAR1. Make your... Read More

Investing In Real Estate Investors

With the never-ending changes in our Real Estate Markets real... Read More

Secrets of Making Money from Real Estate - Part 3

Great, now how do I actually INVEST in real estate?Investing... Read More

Landlords Dance The FICO Fandango

Fair Isaac Corporation is the creator of the FICO credit... Read More

Follow-Up - The Key To Successful Closings

If everyone always did everything they said they'd do, we'd... Read More

A Powerful Suggested Technique for YOUR Home & Property Search

A Powerful Suggested Technique for YOUR Home & Property Search... Read More

The Pros and Cons Of Hiring A Real Estate Lawyer

You're travelling in a foreign country and you get arrested... Read More

Property Investment - What Future For the Biggest Bubble of All Time?

The Economist magazine published a special report in this months... Read More

Back To The Future - Big Changes Are Coming, Get Ready Now

The comments below are quoted from a recent speech by... Read More

Houses For Sale By Owner - Negotiating Tips

Houses for sale by owner, also known as "FSBOs," are... Read More

Real Estate Investing with Bad Credit!

By being creative, you can play the game of real... Read More

Negotiating and Sales Skills Are Critical

When I first started getting active in creative real estate,... Read More

Should you Sell your Home yourself?

Should you sell your home yourself? Yes and no. Yes,... Read More

Is An Old Home for You? ? The Cons

So you think you might like to buy an old... Read More

Title Insurance ? Examples of Problems and Advice

What is title insurance and why should any buyer get... Read More

Much Ado About Mansionization?

Is there a perpetual shadow hovering over your house? Do... Read More

Dont Buy Ugly Houses!

Ugly houses can be great investments, but we don't buy... Read More

Purchasing Florida Investment Property And Various Considerations

Purchasing Florida Investment PropertyConsidering researching the purchase of Florida Investment... Read More

Selling Houses: Flooring & Feelings

Buyers think they love Italian tile and other hard floor... Read More

Setting Goals for Real Estate Success

The power of goal setting has been well documented and... Read More

The 21st Century Way To Build Equity

Here to stay and firmly established in the U.S. mortgage... Read More

How Much Should I Pay For This House?

We probably answer this question for someone a couple times... Read More

Raising Money For Property Development

In addition to finding the right property, one of the... Read More

Realtors: Forget Your Address?

It's a large real estate agency, and the company depends... Read More

Let the Broker Show the House

Of course you're curious, and you'd like to see what... Read More

How to Decrease the Value of Your Own House

Owning a house is part of the American Dream. Depending... Read More

Real Estate, Real Property and Leased Land; Definitions, Discussion and Explanations

Delaware, and the rest of the original British Colonies, has... Read More

Lease Options or Rent to Own?

Finding a rent-to-own house is one of the many ways... Read More

How to Get the Best Price for Your House

The best price to sell your home is always determined... Read More

Are You Profiting From O.P.P.?

Are you profiting from O.P.P.? If not, why not? We... Read More

Staging® Your Home for Sale: a Superior Real Estate Home Marketing Technique: Part 1

Every Realtor KNOWS that a home should be shown in... Read More