I have 50k to invest. We have two investment propereties and no morgtage on our own property and no loans. I am weary of buying property now as they are too expensive. I am happy with my pension fund. I was thinking of putting this 50k into the Augusta fund. 5 year period returning approx 40k (plus the 50k) after cgt. Any other options worth considering? Thanks for some adbice.
The €40k return is a projection and is by no means guaranteed. This is made clear on the Augusta website:
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Bear in mind this is a geared fund, so while this will increase profits if German property prices rise, it will likewise magnify losses if they fall.
I put money in the last Augusta fund, which was investing in two German nursing homes. One of the things which attracted me was that the initial rental yields, at ca. 9%, were high enough that even with no increase in the value of the property, the fund would still produce a before-tax return of 35% in five years. With rental yields that high to begin with, it was also hard to see how values could fall much or at all, barring a major economic crisis.
It's not clear from the brochure for the current fund how it would stack up for differing levels of capital appreciation. However, I found the Augusta people very easy and forthcoming to deal with, so give them a shout and ask for more detail.
Like yourself, I think Irish property too dear at present, and a syndicate like the Augusta one is a hassle-free way to get exposure to overseas commercial property which would be out of the reach of most individual investors. That said, you pay for the convenience through the management charges - make sure you understand them, they are spelled out in the brochure.
There are also similar geared property funds available from some of the life companies, like Friends First or Canada Life. Shop around!