Property investment companies, grrrrrrrrrrrrrrrrrrrrrrr .....
I bought 2 flats through 2 different PICs, and then went on to source a mixture of flats and houses myself. The ones I found myself have all done well, and I have had very few problems with them.
However, the first 2 flats ......
I lost aroud £6000 on the first after having it for 15 months and being unable to rent it out during that period, as apparently, all of the other 28 flats had gone to investors too. That is despite advertising it at £425pcm when I had been assured by the PIC it would reach £550. When I tried to sell it, it took 15 months to go and I had to let it go at £100k, despite being told it was worth £128k when I bought it.
The other flat is an ongoing nightmare. I lost my first perfect tenant when he got fed up with the antics of the drug dealer renting from another investor in the flat above. When the drug dealer moved out an even nastier piece of work moved in. He continues to play loud music all night and frequently wakes up my new perfect tenant. As it appears, most if not all of the other 60 or so apartments were also let to investors, there are constantly people moving in and out and as a result, lots of fly tipping all over the development.
Now as a result of other landlords not bothering to vet their tenants propertly, my new tenant is threatening to quit.
I've been told by local estate agents that the flat is worth about £4k more than I paid for it 3 years ago. That's £16k less that I was told by the PIC when I bought it. And I've had to sub it for the last year as it reaches £550 pcm rent, not the £650 I was advised it would.
I'm not asking for advice, I've learned the hard way. I just want to warn those tentatively dipping their toes into the property investment pond for the first time. Be very careful. Take advice from local estate agents because they know the true value of properties much better than the PICs. And don't let the PICs convince you the agents valuations are wrong with comments such as 'they don't realise how nice the property will be when it's finished' or 'they don't know what they are talking about', after all they make a commission from each sale they make.
It's a cruel world out there .... tread carefully!
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