Zero Tax Property

Hi Askaboutmoney,
I'm looking at a property investment in my pension through this firm/website [Edit - link removed]
They have told me that I should have 8-12% annual returns with a 25 year government lease under the governments commitment to social housing.
There is also the option of lending so instead of 1 property I could get two for diversification
One of their ideas they use is to turn the purchased property into a HMO(House of multiple occupancy) to increase yield by putting in more beds
I like the idea of government leases as this takes risk off the table but this HMO has me a little concerned.
Has anyone else come across this company or investment.
Any thoughts appreciated.
Thanks

What is the name of the company ?

Be wary of companies offering predictive returns. I can just as easily tell you my property scheme will produce annual returns of 10 - 14%. The thing is, I have no influence on the property market in Ireland and my returns may or may not happen, as the small print on the document I get you to sign will clearly state.

When investing, always remember that risk and return are related. The higher the return, the higher the risk. Anyone telling you the risk is low but the returns are high is lying to you and you need to ask yourself what they are hiding.

As the actual leasing of the property, it is the councils that you lease the property to under the Long Term Leasing Initiative. They look after everything, including repairs and upkeep of the property. The pay 80-85% of the market rate to you for the property.

You always have the option of purchasing the property yourself through your pension and renting it to the council?


Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)

Pinoy adventure said:

What is the name of the company ?

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Thanks for reply. Opted against this for a number of reasons
1) Rental income was 80% of market value. Not clear at outset
2) The local authority are not responsible for major structural problems externally or anything to do with the roof
3) The cost of lending in the scheme was 5.5%
4) The set up costs of pension were higher than I thought
5) The HMO option which it looks like you need to obtain 'higher returns' does not sit comfortably with me
6) As SBARRET inferred I was chasing the return and not looking at the fundamentals and 8-12% is not achievable
Thanks

HMO is a UK term - this is an Irish site - where are you/this investment based?

I'm in Ireland, The salesman did mention it was something more popular in the UK and they wanted to do it here.

As a further follow up, no does not mean no to these sales guys