UK residential property Nov 2009
Contents Long term trends The recession Recovery Our approach
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UK property BristolGlasgowLiverpool Newcastle ManchesterDundeeEdinburgh Nottingham
Long term trends
Long term trends – ownership. Residential: The rental market remains small The Gov. aims to encourage its growth
Long term trends – size and ownership. Residential a very large asset class, with low UK Institutional participation
Above: Residential consistently outperforms other asset classes Below: Residential has been less volatile in a downturn Long term trends – residential performance UK asset performance to December 2008
Long term trends – price growth. Residential: London and UK move in the same way Source: Halifax and Government
Long term trends – price growth. Residential: Long term stable growth and low volatility Source: Halifax and Government
Recession
Recession – overall impact (peak to trough ) -40% Shares Commercial Property All Residential Property Gm Residential -15% -45% -11%
Recession – city by city performance Gm has outperformed the market by 30% Land RegistryGm FundsDiff. Edinburgh -10%-6% + 4% Glasgow -13%-7% + 6% Stirling -11%-7% + 4% Dundee -11%-4% + 7% Newcastle -13%-8% + 5% Nottingham -14%-15%-1% Birmingham -14%-12% + 2% Bristol -19%-13% + 6% Liverpool -13%-12% + 1% Salford -15%-14% + 1% Manchester -15%-18%-3% Grand total -15%-11%
Recession – recent international price trends
Recession – recent price trends Prices have risen for 7 consecutive months
Recession – a positive impact on the student rental market +10% Large / growing student market 175,000 students turned away! Shortage of student housing
Recovery – 4 stages ‘House prices have risen for the past 7 months’ – Nationwide
Headlines
Our approach
What we do Property funds We outperform the market by 30% Private Clients ‘One stop solution’ Source Renovate Furnish Let / manage
About Grant Management Worldwide client base 12 UK cities £500m / 1,850 prop. under man. Lloyds Banking Group own 20% ARLA members / code of practice
Traditional over new build? Shortage of supply Better locations Higher yields 2% Gross Yields 7% 4%
How we add value Buying well Price, location Investment model Renovations On time – 8 weeks On budget - fixed price Management Safety/ compliance Occupancy – 95%
BeforeAfterDiff. Value£215k£250k+ £35K Rent pcm £788£1,400+ £612 Yield4.4%7.6% + 72% Case Study – adding value 2 (MD) Summerhall Square, Newington, Edinburgh, EH9 1QD Bought: Mar 2009 Renovation Costs: £32,475
Our homes
The student market Large university cities Secure income (Joint leases/guarantors) Universities “recession proof” Around 75% of our properties are let to students
Residential is a good asset class Gm offers a great solution for private clients and funds Student Market is large and growing Great time to buy Summary
1.To help new clients to enter the market 2.To build partnerships 3.To partner fund managers and sovereign wealth funds CastlesBanksFunds Our aims
Long term trends The recession Recovery Our approach
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