Property investment is viewed by some as a long-term route to a potential goldmine, by others as a labour-intensive route to very little, but by the majority as an important asset within a portfolio of diversified investment.
However, with the increase in popularity of a new concept in property investment, these perspectives could be set to change forever.
End-to end (or full-service) property investment is being utilised by high-net-worth individuals as an attractive means of adding this invaluable asset class to their portfolio.
Full Management
Full service property investment is essentially targeted toward ensuring that property investment is as easy to become involved with as other asset classes. Often investment is complex, the purchasing process lengthy, and the selling process arduous, not to mention the maintenance and improvements required during the period of ownership.
Full service property investment manages to negate these issues – issues which have historically made property slightly less attractive to professional investors – while offering capital appreciation of up to 70% in three years in some cases.
The most attractive areas for investment currently are London (particularly the regenerated South East) and Manchester in the UK, New York, Chicago, Miami and Seattle in the US, and in Australia; Melbourne, Sydney and Brisbane. These markets are seen as being particularly robust and are projected to see large economic and property market expansion over the next 10 years.
They are also undergoing significant areas of redevelopment, and it is these projects which are of specific interest to investors using the full service investment option.
For example: the investment company essentially buys up a whole floor of exclusive apartments in a building while at the development stage. As the investment company has put forward a large amount of capital upfront, and generally has a relationship with the developer, it is able to secure each individual unit at a significant reduction to the standard market price.
Potential for Quick Returns
There are then many options available to the investor. If they choose to invest in an apartment with a view to letting the property, the end-to-end nature of full service property investment ensures that the management of the property is undertaken, while also offered are mortgage services, and assistance when it comes to selling the property.
Some investors have found that between the time of purchase – during construction – and the completion of the project, the value has soared to such a level that they opt to simply sell the property, and take the capital return.
The most attractive aspect for many is that a full service property investment will undertake all the necessary research required to be able to offer credible projections before investment, and will usually have their own portfolio of investment opportunities to cater for a variety of individual appetites.
With such great attention to detail in terms of research, investors have been putting up the initial capital (as little as $100,000 initially), and letting the full service aspect do its thing, receiving market updates and advice on how best to utilise the investment in the same manner they would expect with any other asset class.
Property as an investment is viewed as the safest asset based on historical data, a previous obstacle for many was the literal amount of physical hours required to dedicate to the investment in order to make it viable. This all but negates the need for that, and as a result – full service property investment is an area of huge interest to expats and investors looking to enter into the property market.