Markowitzman
A few responses to your questions
Don King, thanks for the clarification.
1. My portfolio is small for the big 4 firms. As a minnow will I be more likely to be seen by a junior in the company for advice?
- Not at all. No practice would allow a junior to engage solely with a client without manager / partner supervision. It is the partner is ultimately the designate face for the firm.
When you request advice, you usually will be asked to sign a letter of engagement, or letter of authorisation. You will meet with partner & his designate manger, who will manage your requirements. The donkey work will be performed by senior, who will delegate admin tasks to a junior. Manager reviews and corrects, if necessary, and then reviews with partner, who signs off on behalf of the practice. You will have a final closing meeting with partner / manager / senior to discuss the opnion.
That's the way it works. From looking at your requirements, I would estimate that you could be quoted between e4k-e5k plus VAT. This might be mitigated if you use their internal financial services, but then how independent is the advice?
2. Will they push for me to do the annual business accounts with them?
- Probably
3. Preliminary investigations with institutions have yielded a prospective variable rate of 3%. Will I get much better if one of the big 4 bat for me?
- I would think not. No institution will lend at less than 75 points margin over ECB (currently 2%), and bearing in mind that you may want to buy / sell future properties, location of properties (i.e how will they react in a downturn), I don't think you would do much better than that
4. JohnGonne yes separate life assurance,property ins etc etc on each. What are likely professional cost of doing a consolidation?
I honestly don't know - I'm not a financial advisor re life assurance, property ins. My only suggestion would be that you look at all aspects of your property portfolio including related expenditure, and see if you can get additional discounts by placing all your business with one provider.
For life cover, look at the type of cover that you have (level term, reducing term) and shop around for the best rates
5. Re consolidation if I was to sell a property or two in the future would this create a legal problem as mortgage was secured on them all?
In managing a portfolio, you should always define an entry and exit strategy ie why are getting into property, and how are you going to get out / it at all?.
To be honest, you would have to talk to your prospective provider on this question. I honestly would not be sure - perhaps the mortage deed would have to be updated to reflect the reduced property portfolio. However the bank may decide to have first call on all proceeds of sale, or not - I don't know
6. Does consolidation make it any easier or more desirable to put the properties into a corporate strtucture or not. Would it be advisable to look at corporate structure?
Again, this depends on what your entry / exit strategy is. Many people have gone into property because of the capital appreciation, without thinking how they are going to get out. I can see at the first sign of a downturn a glut of second hand property coming onto the marketplace.
Are you long or short on property. Do you intend to use your portfolio to finance children's education, lifestyle expenditure etc (short), or do you intend to use this for pension / inheritance (long). Would you plan to sell the portfolio as one block investment in the future. Property investment is a business - from extensive reading of this bulletin board, a lot of people have not clicked with that as yet.
My rule of thumb (and I stress rule of thumb) would be - if you are short, keep the property in your own name - do not put into a corporate structure. If you are long, then a corporate structure becomes a much more viable proposition