Frequently Asked Questions

Why should I choose 1st Property Investment?

Everyone at 1st Property Investment is a property investor themselves, so we all understand the whole investment process. Our Managing Director built up a portfolio investment properties over several years before becoming so inundated for requests for property investment help from friends and family that he decided to set up 1st Property Investment – and his current portfolio is over 25 properties. Our staff team here currently hold a combined total of over £2million in investment property equity!

Do you sell overseas properties?

We specialise only in the UK’s London & South East property markets, which have historically shown the best returns. Our property sourcing team looks particularly for sites planned in areas with the capacity for significant demographic change – for example – because of substantially improved transport links or government investment.

What type of properties do you source?

Typically we source off-plan or newbuild houses and apartments in sites by the major UK housebuilders – this means that our investors can rest easy that there will be no refurbishment costs for the first few years of ownership. All the properties we source are covered by the NHBC guarantee scheme, and by working with the larger developers, we know our clients will have access to central client services team if they have any questions after the on-site marketing office closes.

What happens if the property market has a downturn?

We are not anticipating a property crash but sensible investors always consider what would happen if market dynamics change. Properties purchased through us have an inbuilt "safety-net" of at least 15%, which means that our clients have an immediate advantage over "traditional" investors.

What happens if interest rates rise?

Interest rates have risen slightly in the last few months and may rise again slightly before stabilising. Our investors protect themselves via a suitable mortgage with a fixed interest rate. Providing this precaution is taken, moderate interest rates can in fact be positive for property investors as they deter some first time buyers and cause rental demand – and rents – to increase.

What fees will I have to pay to 1st Property Investment?

We charge a 3% finders fee on the discounted value each investment property sourced for an investor. This is payable when the property is reserved.

What other costs should I budget for?

Once a property is selected, you will need to pay a reservation fee secure the property, which will then be transferred to form part of your deposit when contracts are completed. In addition, you will need to budget for solicitors’ fees and the remainder of your 5% mortgage deposit. When your property completes you may need to supply for carpets and curtains where these are not included in the basic ‘spec’ – if required, we can help you source these competitively and get them fitted. You should also anticipate an initial 4-6 week rental void whilst your property is advertised in the local rental market, and remember that all apartments carry an annual service charge of a few hundred pounds.

What happens if my apartment is empty for a period?

We will advise you on the best letting agents in the area, help you negotiate a good rate with your chosen agent and give tips on how to present your property to best effect.

Can I use my own solicitor or mortgage broker?

We strongly advise that you use our own solicitor, as when we are dealing with developments with several purchasers we hope you appreciate that we need to get information from one source. We can also introduce you to mortgage brokers who can help find you specialist buy-to-let mortgages which are not available on the open market. Our suppliers are all specialists in their fields, and we work with them because they understand professional property investment – we get no financial ‘kickback’ from any of the professionals we recommend

Do I pay tax on my property profits?

Unfortunately you do - BUT we can recommend advisors who will help minimise the amount of tax you pay legally – and remember that taxable ‘profits’ are calculated on the increase between your initial ‘contract’ price and the re-sell contract price – this means that the 15-18% equity you’ve received via your discount is effectively tax-free!

Who will manage my properties?

Most of our clients place their properties with a local agent. If you want a totally ‘hands-off’ approach, we can provide full portfolio management services for a nominal fee.

Why do developers give you discounts?

In some circumstances – for example, when selling the first or last few units on a site, or just before financial year-end – developers may consider offering property to investors at a discount. These deals are not available to speculative buyers as the developer needs to have full confidence that they are dealing with professional purchasers who are in a position to move quickly.

How do I know if a discount is genuine?

Two important ways to check that any discounts are genuine are to ask if property on the site has been valued at the quoted price by a RICS-qualified surveyor, and to check that a high proportion of units on the site have been sold to residential purchasers. All our properties meet these criteria.

Can I resell my property as soon as it completes, and realise the profit straight away?

Property Investment should be approached as a 5-10yr investment opportunity. Property prices in regeneration areas in particular have a tendency to fluctuate in the first 18 months although they show the best returns over a longer period. We do have opportunities in established market towns and commuter areas for investors looking for greater short-term surety, but we wouldn’t advise property investment if you need to get your investment capital back in a short timescale.

If I decide not to go ahead, can I have my money back?

When we reserve a property for you, we make a commitment on your behalf to the developer and because of this the fees we charge are non-refundable. In some circumstances – for example, if completion on the site is substantially delayed – we may be able to transfer your fees across to a property on another site.