 |
 |
 |
 |
 |
 |
Further Investor details |
||||||||||||||||||||||||||||||||||||||||||
| We focus on the customer, we assess his needs and we implement his strategy in investment properties. To us the customer is everything and without the customer we have no business. |
||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||
 WHY USE NAVER?
|
||||||||||||||||||||||||||||||||||||||||||
| CUSTOMERS: | ||||||||||||||||||||||||||||||||||||||||||
| Naver have offices in London and Hull
Naver are independent, not tied, and therefore able to offer independent advice
Naver puts their customers first |
||||||||||||||||||||||||||||||||||||||||||
| CUSTOMER NEEDS: | ||||||||||||||||||||||||||||||||||||||||||
| Naver’s management are professional, efficient, and offer an enthusiastic
service Naver offers a time saving, cost saving strategy Naver has the ability to tailor services to customers needs Naver pride themselves on offering Proactive services |
||||||||||||||||||||||||||||||||||||||||||
| INVESTMENT PROPERTY: | ||||||||||||||||||||||||||||||||||||||||||
| Naver have researched the high yield market and have identified suitable
markets for high yield investment Naver have a good working knowledge of their target region, Hull Naver have an enviable network of “on the ground” relationships Naver operates a unique framework for the purchase and subsequent management of properties. Naver have considerable knowledge of investment and many types of investment products. |
||||||||||||||||||||||||||||||||||||||||||
| WHY INVEST IN PROPERTY IN HULL? |
||||||||||||||||||||||||||||||||||||||||||
| Prices: The Hull property market has not been affected by the strong price increases of the South East over the past 5 years. However, over the past 6-12 months it has appreciated in price in the region of 15%. Although this sounds considerable, it is coming from a low base and from1995 to 2000 when the property market in the South East rose strongly, Hull only rose marginally. Price increases vary enormously throughout the city and outlying regions, however, for a general perspective; over the past 10 years prices have risen 31% in Yorkshire and Humberside, and 21% over the last 2 years (according to Nationwide Building Society). |
||||||||||||||||||||||||||||||||||||||||||
| There has been an increase in investors from outside the region seeking
high yield investments and in our opinion this is likely to continue to
act as a cushion protecting the market from falling. There are also a number of owner occupiers still trapped in negative equity from the last property rally in the 80’s. The market fell back to such an extent that those levels have still not been attained. The majority of the properties we purchase are in the region of £20,000 to £27,000. There are a few below this range and usually priced lower for a reason, and likewise there is a large market for professionals from £27,000 up to and in excess of £150,000, however, at these levels yields diminish. |
||||||||||||||||||||||||||||||||||||||||||
| Yields: For properties priced at £17,000 to £27,000 one can expect a rent of between £55 and £75 per week. This makes the yield on average between 12% and 18%. Residential property investment in Hull offers an extremely attractive yield along with the potential for capital appreciation, and at worst capital protection. For properties priced in excess of £30,000 and up to £150,000 the yield usually falls to in the region of 7-12%. Compare this to the South East where recent ARLA figures suggest the average gross yield on property in the South East is 6% and it is widely reported in the press that there is a strong likelihood of capital depreciation. |
||||||||||||||||||||||||||||||||||||||||||
| Capital Growth and Yield: In conclusion, extremely good yields and potential for capital increase offers an extremely attractive investment in the present climate. Combine this with 30-year low interest rates and the ability to borrow money at near 5% and achieving a 15% yield offers an attractive proposition. |
KEY FACTS ABOUT HULL: |
|||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||
| Click for pictures of properties | ||||||||||||||||||||||||||||||||||||||||||
| TYPES OF TENANTS: |
||||||||||||||||||||||||||||||||||||||||||
| Professional: There are a number of international and national businesses with HQ’s or large offices in and around Hull. The professionals working at these organisations often stay in the area for short periods of time before becoming seconded elsewhere around Britain or the world. As such there are many companies and individuals renting good quality accommodation in Hull. Properties in the better parts of Hull will be let to professionals. The smarter properties in the better neighbourhoods of Hull can be let for £300 per week. There is also a strong demand for rented accommodation from medical staff in Hull, this demand is centred around the 5 hospitals in Hull. | ||||||||||||||||||||||||||||||||||||||||||
| Student: Properties near the campus of Hull University and Hull College can be let to students. Rent is in the region of £30-£35 per person per week, and accommodation tends to be of a very high standard. We can advise on HMO rules, specifications and all matters pertaining to student letting. There are approx 11,000 students in Hull. | ||||||||||||||||||||||||||||||||||||||||||
DSS: This is a category of tenant we are comfortable with. We employ strict tenant selection criteria and undertake regular checks on properties. Rent is paid monthly in arrears directly by the Department of Social Security and the amount of housing benefit paid is dependent upon the property and the tenants circumstances, however, the average would be approx £60 per week for a 2 bed mid terrace house. There are approximately 30,000 housing benefit recipients in Hull.
|
||||||||||||||||||||||||||||||||||||||||||
| NAVER PROPERTY PURCHASE SERVICE: |
||||||||||||||||||||||||||||||||||||||||||
| This section outlines step by step the process involved in the purchase of an investment property. This process can then be repeated with or without borrowing until a portfolio is built up.The investment process can be tailored to suit each individual and their specific requirements, however, the below outlines an example of how we usually proceed. The aim is to offer you a service that takes the hassle out of property investment. We try and ensure that the minimum amount of works needs to be done by you. | ||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||
| INVESTOR DETAILS: |
||||||||||||||||||||||||||||||||||||||||||
| Over the telephone, by email or post, or through a meeting in London or Hull, we strive to understand your needs and goals. We want to be sure we know each investor and that we are able to offer you the best advice so that your objectives can be achieved. It is a learning process for both of us, and ensures that you are comfortable with our company and the services we offer. We will send you marketing material and you decide whether to take it further or not. | ||||||||||||||||||||||||||||||||||||||||||
| VISIT:
|
||||||||||||||||||||||||||||||||||||||||||
| If after initial discussions, and having read our marketing material you think property investment in Hull might be of interest, we recommend a visit to Hull to assess the market. We will show you around town, show you areas we like, show you examples of properties we buy and clarify any doubts you may have. If we have not done so before, it offers us the chance to meet each other face to face. | ||||||||||||||||||||||||||||||||||||||||||
| PROPERTY FINDING |
||||||||||||||||||||||||||||||||||||||||||
| If after your visit you decide to proceed, you will instruct us to act as agent for you in finding a property. We will require a form to be completed and signed by you and forwarded by email or fax or mail to our offices. (This ensures us of your commitment, and adds you to our property buyers list. It is not a binding document, and there is no payment if you buy or do not buy). | ||||||||||||||||||||||||||||||||||||||||||
| PROPERTY FOUND |
||||||||||||||||||||||||||||||||||||||||||
| We will select properties that suit your investment aims and yield and capital appreciation criteria. The properties are sold to you as a complete package. Ie. We undertake all the labour intensive processes of property finding, selection, bidding, surveying, assessing works, undertaking works, and taking the property to a tenantable state. The advantage of this to you, the investor, is that you have none of the hastle, worry, or work involved in the purchase and refurb of the property. The works improve the condition of the property and are always undertaken by Naver to a specific standard. |
||||||||||||||||||||||||||||||||||||||||||
| SELECTION AND PURCHASE |
||||||||||||||||||||||||||||||||||||||||||
| Once a suitable property has been selected by you and the bid accepted, we will require you to pay the full amount of funds to an independent solicitor. This is a solicitor who understands how Naver operates, but is wholly independent of us and acting on your instructions. He will remit the monies to Naver and the other parties concerned as and when invoiced. The amount you pay though will never be in excess of the full amount originally quoted. This is an all inclusive price. | ||||||||||||||||||||||||||||||||||||||||||
| On completion of the refurb works one can attain an independent surveyor who will verify the value of the property. The property you own is in your name (or your spouses or Company), the property will have a CORGI Gas Safety Certificate, an NICEIC Electrical Safety Certificate, Gas Central Heating and be carpeted and decorated throughout to Naver Standards. | ||||||||||||||||||||||||||||||||||||||||||
| TENANT SELECTION |
||||||||||||||||||||||||||||||||||||||||||
| The property will, during the refurb process, be marketed to prospective tenants in the hope of getting the property tenanted as soon as possible after the refurb. This is an extremely important process and Naver have their own strict tenant selection criteria. | ||||||||||||||||||||||||||||||||||||||||||
| MANAGEMENT |
||||||||||||||||||||||||||||||||||||||||||
| We will deal with all maintenance and emergency call outs. We will account to you monthly, or as preferred, with rents received. All rents are paid into an independent client account and we take our fee from here. | ||||||||||||||||||||||||||||||||||||||||||
| PORTFOLIO BUILDING |
||||||||||||||||||||||||||||||||||||||||||
| : We strive to build portfolios of high yielding properties for our investors. We can recommend the best methods of doing this, within your investment parameters. This may involve borrowing or mortgages or may be cash purchases. Either way we can refer you to mortgage brokers, solicitors, surveyors and banks as necessary. | ||||||||||||||||||||||||||||||||||||||||||
| PROPERTY SALES |
||||||||||||||||||||||||||||||||||||||||||
| It is essential that there is an exit strategy for your investment. We will be happy to advise on sales matters, and sell properties and portfolio's ourselves as well as recommend other agents. However, property should be seen as a long term investment and not as liquid and instantly realisable. | ||||||||||||||||||||||||||||||||||||||||||
| PROPERTY ANALYSIS |
||||||||||||||||||||||||||||||||||||||||||
| Naver will happily assess an individual property or portfolio of properties for investor landlords. This might equate to assessing refurb works and costs or advice on purchases and sales within a portfolio. | ||||||||||||||||||||||||||||||||||||||||||
| NB: VARIATIONS: The above is an example of the purchase process and not a strict rule. We aim to be flexible and take advantage of any opportunities that might benefit you. For example, there may be properties owned in our name which we have renovated, or there may be properties which are sold as part of a portfolio. Alternatively, some properties might be sold with tenants in situ. | ||||||||||||||||||||||||||||||||||||||||||
| OTHER LANDLORD SERVICES |
||||||||||||||||||||||||||||||||||||||||||
| Financing: |
||||||||||||||||||||||||||||||||||||||||||
| Through relationships with brokers and banks, we are able to refer you
to providers of finance. This means that from a modest investment of only £5,000 one can purchase a property and from there expand it into a substantial portfolio over time. Secondly, for those with larger portfolios and other assets to secure the loan against, we can help direct you to banks offering competitive finance. We have an agreement with a leading UK bank to provide loans for portfolios.Most national lenders are loath to lend on properties under £30,000 in value, and in recent months many financial institutions have been curtailing their risk profile on residential property investments. We can try and point you in the right direction but we are not financial advisors or mortgage brokers. |
||||||||||||||||||||||||||||||||||||||||||
| Portfolio Building: |
||||||||||||||||||||||||||||||||||||||||||
| There are a number of ways to grow or accumulate a portfolio of properties. | ||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||
| Further information on any or all of the above can be discussed further on request. | ||||||||||||||||||||||||||||||||||||||||||
| Proposed Investments: |
||||||||||||||||||||||||||||||||||||||||||
| We would like to have a detailed discussion with each prospective landlord
about what sort of property he wants. We want to be sure we know each landlord
and that we are able to offer him the best advice so that he can achieve
his objectives. We want to ensure the correct level of risk, the correct
tenant profile you are wanting and the correct area of Hull. We can attain this through discussions with you, or alternatively please do visit our offices in London or Hull. |
||||||||||||||||||||||||||||||||||||||||||
| Naver Systems: |
||||||||||||||||||||||||||||||||||||||||||
| PSC STAN TEN MS |
||||||||||||||||||||||||||||||||||||||||||
| Naver management realized that there is often a lot of talk and little action
offered in the property management world. We therefore devised a framework
for activities to be centred around, it is not a fixed structure but rather
a guide for us in undertaking activities and a guide to help you understand
the roles we undertake. It is a unique four tier framework for the purchase and subsequent management of properties, and consists of adopting a “property selection criteria” (PSC) program on each property we purchase for investors. Then we ensure the property reaches a unique state of repair “standard” (STAN) pre letting. This is followed by “tenant selection framework” (TEN) to approve a tenant, followed by “Management Systems” (MS) to efficiently manage the properties. For more information please contact management. |
||||||||||||||||||||||||||||||||||||||||||
| Capital Growth: |
||||||||||||||||||||||||||||||||||||||||||
| Unfortunately we cannot guarantee this. Historical performance is no guide to future performance. Naver management are positive on the prospects for Hull economically, and we can hope that this flows through to the property market. Property prices are relatively low in comparison to the rest of the UK and we believe this offers limited downside, and at worst offers investors capital protection. | ||||||||||||||||||||||||||||||||||||||||||
| Furnishing and Furniture Costs: |
||||||||||||||||||||||||||||||||||||||||||
| Most of the properties that Naver manages will be unfurnished.
The only instances when we would recommend basic furnishings would be when
letting to nurses or students. We would recommend good quality, not necessarily
expensive, furniture. That way it helps sell the property rather than detract
from the attractiveness. We can usually source suitable furniture relatively cheaply. Remember that furniture can also be depreciated for tax purposes. |
||||||||||||||||||||||||||||||||||||||||||
| Relationships: |
||||||||||||||||||||||||||||||||||||||||||
| Naver have established relationships with the following companies ensuring efficient property management and the ability to pass on benefits to our clients; Property Lawyers and Solicitors, Builders, Insurance agents, Mortgage/Finance Arrangers, Estate Agents, and Surveyors. | ||||||||||||||||||||||||||||||||||||||||||
| Insurance Costs: |
||||||||||||||||||||||||||||||||||||||||||
| Building insurance for a investment property, valued at £30,000 is approximately
£150 per annum. There are cheaper schemes but we believe there is
no point in under insuring or insuring with the wrong company. |
||||||||||||||||||||||||||||||||||||||||||
| References: |
||||||||||||||||||||||||||||||||||||||||||
| If you would like to receive references about our company please do ask. Otherwise, please do telephone us with any queries or come in to the London or Hull office and meet with us. | ||||||||||||||||||||||||||||||||||||||||||
| EXAMPLE OF PROPERTY INVESTMENT:
|
||||||||||||||||||||||||||||||||||||||||||
| So many of the illustrations given to investors miss out certain key data
in order to flatter the investment case. One of the most startling and still
used techniques is to incorporate a not insignificant capital appreciation
rate into a formula. At Naver, we are keen to portray the rewards of the investment however, we want investors to be clear about the risks too. We want to ensure investors have realistic examples. |
||||||||||||||||||||||||||||||||||||||||||
| ExampleA: Below we show a simple example of a property and some factors affecting it over the year, we have given a worst case and best case scenario. Assumptions: |
||||||||||||||||||||||||||||||||||||||||||
| 1. Unlike many examples you may see we provide a flat market, any capital appreciation cannot be guaranteed. 2. It is based on just one property 3. Best Case assumes a rent of £80 per week, no maintenance expense, and no void 4. Worst Case assumes a rent of £70 per week, maintenance of 10%, void of 5% |
||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||
Just by adjusting the small variances between the worst and best case scenario’s one can see that the net yield changes from 13% in best case to 9% in worst case. It illustrates how important property management is as a function of the investment return
|
||||||||||||||||||||||||||||||||||||||||||
| There are other factors, eg. Borrowing that have not been included in this example, however, this table is supposed to highlight the risks and rewards, the real picture. | ||||||||||||||||||||||||||||||||||||||||||
| Example B: |
||||||||||||||||||||||||||||||||||||||||||
| A portfolio of 10 houses can be purchased for a total of £250,000,
fully refurbished and ready to rent. The rent attainable in year 1 at an
average rent of £65 per week is £3380 per property, and £33,800
for the 10 properties for the year, a gross yield of 13.5%. Excluding management costs outlined above, assuming a rental growth rate of 3%, ie.the rent increases by 3% per annum, the total rent over a 10 year period equates to £441,013. This is a return on capital employed of 176%. Any capital appreciation on top of this will obviously flatter the figures further. This effect can obviously be rolled out to a larger number of properties through gearing and the conservative use of borrowing. |
||||||||||||||||||||||||||||||||||||||||||
| Example C: This is to show the effect of gearing (borrowing) on the sums. As can be seen by utilizing an interest free mortgage the return on investment is enhanced dramatically. |
||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||
This assumes no capital appreciation, it takes the best case scenario given above with a mid rent amount of 75, and of course loan or mortgage rates can go up and down from the 5.5% given. |
||||||||||||||||||||||||||||||||||||||||||
| Please click blue arrow to return to the top of the page. |
