1. Which works best? Residential, commercial or something else?
John Howell
Editor & Founder of Guides Global

2. A copy of this presentation can be downloaded from www. guidesglobal
A copy of this presentation can be downloaded from

3. Agenda A bit about John Howell Residential Property
Commercial Property
Other Property Opportunities
What have people been buying?
What works best?
Questions
A lot to cover: 34 slides in 20 minutes!
Wednesday, April 24, 2019

4. John Howell
Dealing with international legal and property issues for well over 30 years
Background as a Solicitor (English Lawyer). Now retired from practice.
Still provides some consultancy services to other law firms and a small number of private clients
Guides Global
Editor & founder of Guides Global –
Online written and video guides about how things really work in other countries
Writer
Author of The Sunday Times® Guides to buying a property in Spain, France, Portugal, Italy, Turkey, the USA & various countries in Eastern Europe
Author of the Cadogan Guides to Setting up a Business in France & Spain
Author of “Don’t Jump In”
Author of the two “International Law” volumes of Butterworths’® Encyclopaedia – a leading textbook for UK lawyers
Speaker
Speaker about international law and property at events around the world
Wednesday, April 24, 2019

5. There are more choices than you might think
Each of you will probably have a preconception as to the one that will be best for you
Every country is different: you may be wrong
Wednesday, April 24, 2019

6. Wednesday, April 24, 2019
If you want or need to borrow part of the price, it is much easier to do so on overseas residential property
Even then, difficult in many countries
So if you want to borrow the availability of finance may drive your choice of investment
Borrowing

7. Residential Property Holiday homes
The weekly rental for holiday homes is usually much higher than for a long-term let
HOWEVER, It will be let for fewer weeks
Rental management (bookings, meeting and greeting, cleaning etc) can be expensive
Up to 35% of rent
The importance of self-help
Typical return 3 – 12%
Wednesday, April 24, 2019

8. Residential Property Your own holiday home
Can be a surprisingly good as investment properties but
You MUST choose well – the right property in the right location at the right price
Length of season VITAL:
Turkey 10 weeks
Cape Verde 50 weeks
You must be careful about when you use it yourself
You must manage the property and the lettings well
So easy to cheat you!
In increasing numbers of places, holiday homes must be specially registered and may pay extra taxes – property taxes and income tax
Wednesday, April 24, 2019

9. Residential Property Holiday Lets
The same as your own holiday home except that your plan is to let for every week possible
Personal use in unimportant:
If you use it all, at it is a bonus
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10. Residential Property Year Round Lets
Decide on a target group of tenants
Teachers
Businesspeople on short term assignments
Students?
Management and finding tenants more complicated than in the UK
Typical returns 3-8%
Residential Property Year Round Lets
Wednesday, April 24, 2019

11. Residential Property University Etc. Lets
These can be great
Visiting teachers etc. will want to be there for about nine months of the year – excluding the peak summer months
You can then use it yourself or let to tourists during the summer
The tenants (or their university) will often find you the next tenant
Big saving
Typical returns 6-12%
Wednesday, April 24, 2019

12. Commercial Property Own Use
Most people will find their money is better employed in their business rather than in their premises
However, if you have the cash buying makes sense
No rent to pay
The landlord can’t terminate your contract and open up in competition with you
Wednesday, April 24, 2019

13. Commercial Property Small/secondary Properties
Seen as more stable then residential lets
Is this true?
Relatively low cost
Puts some diversity into a portfolio
Decline of the high street: the amazon effect
Rents typically 4-5%
Wednesday, April 24, 2019

14. Commercial Property Prime Real Estate
Tends to be very large
Very expensive
Unaffordable unless as part of a group
Used to be gold-plated: 5% with upwards-only rent reviews
No longer
Lots of empty stores
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15. Other Commercial Property
Warehouses
Office blocks
Hotels
Factories
Etc
Most of the same thoughts apply as in shops
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16. Other Property Style Investments Fractional Ownership
Where several people share the ownership of an asset
Apartment
Hotel room
Shop
Can be set up and operated as a business
Can be set up by a group of friends
Is the cost of the asset fair?
What is the exit route?
Wednesday, April 24, 2019

17. Other Property Style Investments Hotel Rooms
You own a room in a hotel
Good ones can offer a decent return with no hands-on management
Usually done as a share of the operator’s income or as a fixed annual rental – where the operator takes the risk
You depend totally on the skill of the operator
Bad deals abound
Careful due diligence needed
Wednesday, April 24, 2019

18. Other Property Style Investments Land
Many types of investment
Land you rent out to a farmer
Low return but stable
Land you buy to build on
No income
Land you HOPE might get zoned for building in the future
Needs good due diligence if it is not to be just a bet
Lots of scams in this area
God isn’t making any more!
Wednesday, April 24, 2019

19. Other Property Style Investments Crops
You own just the right to harvest the crops
Not the land
You are totally dependent upon others
You are completely exposed to market fluctuations
Personally, I think this is bonkers!
At the very least, you need good due diligence
Wednesday, April 24, 2019

20. Other Property Style Investments Car Parks, Storage Units etc.
You own a space in a car park (or storage unit)
A bit like owning a hotel room
Huge returns often promised
Are they delivered?
You are completely dependent upon the operator
Be very careful
Wednesday, April 24, 2019

21. Other Property Style Investments Shares in Property Investment Funds
You own a share in the company or vehicle that invests in international property
Some are very good, some awful
You depend upon the skill of the managers
High overheads can eat into profit
What is the exit strategy?
Other Property Style Investments Shares in Property Investment Funds
Wednesday, April 24, 2019

22. Other Property Style Investments Property Investment Clubs
You pool your money with others
Diversification
Can afford better quality property
Sometimes allow access to finance
Some are run commercially
Often offer very poor value
Often charge high fees, some hidden
Some are run by groups of friends
They can be very profitable
No one is charging for their time
No overheads
Can be great fun!
Could lose all your money
Wednesday, April 24, 2019

23. What have people been buying?
The clients of my firm from – 1996
10,231 property purchases
In the early days, very few bought anything except residential property
Holiday homes
No thought of making money
The commercial properties were mainly bars and restaurants for their own use
The “others” were, mainly, fractional ownership
Later it changed!
Wednesday, April 24, 2019

24. What have people been buying?
10,274 property purchases
The overseas property boom years
Overwhelmingly residential
Increasingly people were buying “other” types of property
Fractional ownership
Hotel rooms
Shares in investment schemes
These proved MUCH more dangerous
Wednesday, April 24, 2019

25. What have people been buying?
261 property purchases
Small numbers because I have retired to run Guides Global and because the market has been much reduced since the crash
Nearly as many buying commercial property as residential
Very few getting involved in “alternative” schemes
Mainly fractional ownership
Wednesday, April 24, 2019

26. What works best?
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27. The best plan will be unique to you
There is no “one size fits all”
What is best for you will be different from what is best from your neighbour, your brother or the bloke in the pub

28. My favourites Residential Property let to university staff
Residential property in places where the currency is likely to rise in value
Two (or more) centre investments for you to live in as well as rent out. The global nomad!
Holiday property let by “July to September” landlords and used by the owners the rest of the time
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29. Ones to Avoid! Or, at least, treat with great suspicion
Crops
Parking & storage – in most cases
Speculative land investments (where you expect to get planning permission) – in most cases
ANYTHING that sounds too good to be true
ANYTHING where you have not taken independent legal advice
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30. More Information Written guides and videos at www.guidesglobal.com
Wednesday, April 24, 2019

31. The last word…
A lot of our clients have made a LOT of money out of international property
and they will continue to do so – if they treat it as a business and take proper advice
Wednesday, April 24, 2019

32. A copy of this presentation can be downloaded from www. guidesglobal
A copy of this presentation can be downloaded from

33. Questions

34. Contact Details Address: John Howell Guides.Global Ltd
23 Bridewell Lane
Bury St Edmunds
Suffolk
IP33 1RE UK
Telephone:
From the UK:
From Overseas:      
Wednesday, April 24, 2019