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

More than 40 states signed onto a proposed $25-billion deal with major mortgage servicers over faulty foreclosure practices. New York, Nevada and Delaware joined California in holding out for better terms.

More than 40 states signed onto a proposed $25-billion settlement with major mortgage servicers over faulty foreclosure procedures, but California, New York and other key states were still not among them.

California has until Monday to share in a multi-state deal with banks to obtain mortgage relief and reforms. Atty. Gen. Kamala Harris, who walked away from talks last year, says the door remains open.

With a Monday deadline at hand, California officials have resumed direct talks with the Obama administration about joining a multibillion-dollar, multi-state mortgage settlement with the nation's largest banks, a source said Sunday.

The talk show host pays $12 million for the 4,088-square-foot house with four bedrooms and four bathrooms. The ocean-view home sits on 1.26 bluff-top acres with beach access.

In one of the more talked-about transactions in town, actors Brad Pitt and Angelina Jolie have sold their Malibu beach house to daytime host and comedian Ellen De Generes for $12 million.

The four-bedroom, five-bathroom house built in 1920 for industrialist James Wigmore lists for $2,875,000.

A decorative cast stone entrance opens to this restored Spanish Colonial Revival-style house in Pasadena's South Orange Grove area. Built in 1920 for industrialist James Wigmore, the house retains such original details as coffered wood ceilings and arched doorways.

They don't believe they can sell their property for what it's worth, so they're spending money on making their homes more comfortable.

Do you fit any of these descriptions?

A biennial research report by the National Assn. of Realtors indicates that a handful of real estate agents and brokers and their clients either don't know the law or don't care to follow it.

When it comes to lawsuits, real estate agents and brokers tangle mostly among themselves.

The president aims to help about 3.5 million people with good credit who are unable to refinance at historically low rates because their homes are worth less than their mortgages.

 

The White House hopes to help millions of homeowners lower their monthly mortgage bill with a $5 billion to $10 billion plan to set up a streamlined refinancing program for people who are current on their payments.

The Standard & Poor's/Case-Shiller index of 20 large U.S. cities fell 1.3% in November from October as foreclosures continue to drag down the housing market.

Three straight months of home-price declines in the biggest U.S. cities showed that foreclosures remain a significant drag on a housing market that is entering its fifth year of deterioration.

L.A. Clipper Chris Paul may be quick down the court, but he moves pretty fast when it comes to buying multimillion-dollar real estate too.