Property Investment DOUBLES Every 7 to 10 years, What’s The Catch?!

Brett Alegre-Wood
November 4, 2020

Our proven model/strategy has worked for us over time

Before I used to say you can buy a property anywhere and it would go up, now that can only happen in areas with the best fundamentals.

This is a big change that I've noticed over the last sort of decade we used to say the biggest assumption was that property doubles every 7 to 10 years. Effectively that used to be the mantra you know that was the mantra that I was taught and to this day that is still correct. The difference is whereas I used to say it was on all property you buy a property anywhere and it would go up now I think you've got to put a massive asterisk and really that asterisk is you know now that only happens where the best fundamentals are.

What do I mean by the best fundamentals you know well I mean shops, schools, transport links,  major employment, major investments, hopefully you know if you've been watching me for a while you know you've heard that mantra you've heard me say that many times. The actual thing is we do it the other way around because shops have the least impact, major investment has the biggest impact,  major employment, major transport, schools and shops.

That's the order that you actually do your research and you know the impact by. So the biggest impact is in investment and you know if you understand that, then when you choose a property you know or you don't forget the property so much because you can actually renovate a property so you can take a crappy property and turn it into a good property. I think that the key to this is you can't change an area.

What you do is you pick the best area and then you find the property within that area whether that be whatever strategy it could be a new build, HMO it could be a student accommodation, it could be whatever okay it could be off plan could be anything you know but the area is the key determinant of those fundamentals. So as an investor you can't change the fundamentals yourself. I think that's one of the key things here is you're not big enough, you're not influential enough to go into an area and say I'm now going to turn this crappy crime ridden area into Hollywood Hills you know it's just not going to happen.

What you can do is you can go to Hollywood Hills and take the worst house in the best street, renovate it and make money. Or you can take an area that's getting massive amounts of investment into it you know planned investment and money behind it and you can buy an off-plan property that completes in three years time you know and ride that investment up. You know and I think that's one of the key things.

One of the things we've really good at it's one of our strategies that we've worked for many many years is regeneration. We talked about that major investment as being the key you go to an area that's being regenerated. It's got to be a big enough regeneration it's not just about it oh look it's a new building, we're talking about you know substantial change in that area.  Do you want to run through sort of talk through an example mate Ritesh.

The 3+1 Plan Brett AlegreWood
The 3+1 Plan Brett AlegreWood
Get the perfect plan for todays market. Download The 3+1 Plan now!
Get the perfect plan for todays market. Download The 3+1 Plan now!

It's a very different market in Scotland, it's a smaller market. There's some fundamental changes namely oil and gas with all the issues there and that I know Aberdeen and a few of those places house prices have dropped considerably. So, it depends on how that's reacted.

Ritesh:  From the regeneration topic that Brett's talking about that's something which you know really excites us and over the last 15 odd years that's pretty much you know the model that we follow. Get into an area which is a four or five out of ten and then you know do your research and see that there's changes that are going to happen.

I'm just going to turn this into a six, seven, eight, nine, ten. A 10 out of 10 area because if you can pick out those areas and get into them early from our experience that's where you make the biggest uplift in prices. The biggest return on your investment which is ultimately what we all want. These are actually two great great examples you know they're both projects which we got involved in you know back in 2010 at the earliest at the early stages. Woolwich and Kidbrooke Village and both regenerations, I actually had clients at that time you know we're selling a 1 bed unit in 2010 for 180 190 who even at that point especially are you sure a one bedroom unit in this development at 180-190 is not overpriced but we said that is because you could find run down second-hand properties in this in these areas for lower.

However, you know research and we're working on something changes that were going to happen we were still stubborn to our belief that yes this system an investment a lot of the clients said okay I'm working with you guys and you know you want to help me build on my portfolio you're going to help me so let's do it and look at the timelines now come up to 2018 and you can pretty much find the developments values have doubled in price. Now what's more interesting as they've doubled in value. Why have they increased in value? You know they've done well but there's a couple of different reasons. I'm not going to take credit on the market and what the market does and you can't control it.

Yes, we've got to understand it and set the right strategies based on the market but that's out of our control. What we do control though picking out the regeneration areas and doing our research on what sort of change is happening in this area. We knew in both cases that Berkeley Homes were committed not to just building a block of 10 apartments 100 or 200 apartments they were creating a village they were building a community in these areas and within the developments they put schooling, commercial facilities in there, you know you name it everything that attracts population in the land was going to be built on these sites and what that is going to do is create exponential demand.

Prices you know the demand is going to go from there to there and that's where prices knew the quickest it's great to actually live through some real nice things and guys not just two examples keep coming but yeah these are just for me very good examples if you buy property in re-gen areas with the right developers and hold them what's possible to be achieved.  

Search Our Articles

Brett: 100%  yeah and I think that you know it really hasn't. It's been a strategy that we've been working for quite some time. Look, the major investment makes a massive difference and it really almost, it doesn't guarantee you success but it certainly makes it a lot more likely.

We've proven that in fact we've proven that same model pretty much there. We've done seven different times in London just in London you know and we've done it various you know times all around the UK for you know the different places we operate.

Video Transcription

This is a big change that I've noticed over the last sort of decade we used to say the biggest assumption was that property doubles every 7 to 10 years. Effectively that used to be the mantra you know that was the mantra that I was taught and to this day that is still correct. The difference is whereas I used to say it was on all property you buy a property anywhere and it would go up now I think you've got to put a massive asterisk and really that asterisk is you know now that only happens where the best fundamentals are. What do I mean by the best fundamentals you know well I mean shops, schools, transport links,  major employment, major investments, hopefully you know if you've been watching me for a while you know you've heard that mantra you've heard me say that many times. The actual thing is we do it the other way around because shops have the least impact, major investment has the biggest impact,  major employment, major transport, schools and shops. That's the order that you actually do your research and you know the impact by. So the biggest impact is in investment and you know if you understand that, then when you choose a property you know or you don't forget the property so much because you can actually renovate a property so you can take a crappy property and turn it into a good property. I think that the key to this is you can't change an area. What you do is you pick the best area and then you find the property within that area whether that be whatever strategy it could be a new build, HMO it could be a student accommodation, it could be whatever okay it could be off plan could be anything you know but the area is the key determinant of those fundamentals. So as an investor you can't change the fundamentals yourself. I think that's one of the key things here is you're not big enough, you're not influential enough to go into an area and say I'm now going to turn this crappy crime ridden area into Hollywood Hills you know it's just not going to happen. What you can do is you can go to Hollywood Hills and take the worst house in the best street, renovate it and make money. Or you can take an area that's getting massive amounts of investment into it you know planned investment and money behind it and you can buy an off-plan property that completes in three years time you know and ride that investment up. You know and I think that's one of the key things. One of the things we've really good at it's one of our strategies that we've worked for many many years is regeneration. We talked about that major investment as being the key you go to an area that's being regenerated. It's got to be a big enough regeneration it's not just about it oh look it's a new building, we're talking about you know substantial change in that area.  Do you want to run through sort of talk through an example mate Ritesh.

Ritesh:  From the regeneration topic that Brett's talking about that's something which you know really excites us and over the last 15 odd years that's pretty much you know the model that we follow. Get into an area which is a four or five out of ten and then you know do your research and see that there's changes that are going to happen. I'm just going to turn this into a six, seven, eight, nine, ten. A 10 out of 10 area because if you can pick out those areas and get into them early from our experience that's where you make the biggest uplift in prices. The biggest return on your investment which is ultimately what we all want. These are actually two great great examples you know they're both projects which we got involved in you know back in 2010 at the earliest at the early stages. Woolwich and Kidbrooke Village and both regenerations, I actually had clients at that time you know we're selling a 1 bed unit in 2010 for 180 190 who even at that point especially are you sure a one bedroom unit in this development at 180-190 is not overpriced but we said that is because you could find run down second-hand properties in this in these areas for lower. However, you know research and we're working on something changes that were going to happen we were still stubborn to our belief that yes this system an investment a lot of the clients said okay I'm working with you guys and you know you want to help me build on my portfolio you're going to help me so let's do it and look at the timelines now come up to 2018 and you can pretty much find the developments values have doubled in price. Now what's more interesting as they've doubled in value. Why have they increased in value? You know they've done well but there's a couple of different reasons. I'm not going to take credit on the market and what the market does and you can't control it. Yes, we've got to understand it and set the right strategies based on the market but that's out of our control. What we do control though picking out the regeneration areas and doing our research on what sort of change is happening in this area. We knew in both cases that Berkeley Homes were committed not to just building a block of 10 apartments 100 or 200 apartments they were creating a village they were building a community in these areas and within the developments they put schooling, commercial facilities in there, you know you name it everything that attracts population in the land was going to be built on these sites and what that is going to do is create exponential demand. Prices you know the demand is going to go from there to there and that's where prices knew the quickest it's great to actually live through some real nice things and guys not just two examples keep coming but yeah these are just for me very good examples if you buy property in re-gen areas with the right developers and hold them what's possible to be achieved.  

Brett: 100%  yeah and I think that you know it really hasn't. It's been a strategy that we've been working for quite some time. Look, the major investment makes a massive difference and it really almost, it doesn't guarantee you success but it certainly makes it a lot more likely. We've proven that in fact we've proven that same model pretty much there. We've done seven different times in London just in London you know and we've done it various you know times all around the UK for you know the different places we operate.


Tags

Property Videos


You may also like

UK Unemployment Up But This Is Why You Don’t Need To Worry

UK Property: Will Biden’s win have an effect?

Beginner Investor Live Property Webinar Series

How to Make Property Investment Effortlessly Done For You!

Join our resident experts - Dan, Ritesh & Ryan 

Dan Ritesh Ryan
__CONFIG_colors_palette__{"active_palette":0,"config":{"colors":{"62516":{"name":"Main Accent","parent":-1}},"gradients":[]},"palettes":[{"name":"Default Palette","value":{"colors":{"62516":{"val":"var(--tcb-color-3)","hsl":{"h":225,"s":0.82,"l":0.01}}},"gradients":[]}}]}__CONFIG_colors_palette__
Reserve your Seat Now!
__CONFIG_colors_palette__{"active_palette":0,"config":{"colors":{"c162b":{"name":"Main Accent","parent":-1}},"gradients":[]},"palettes":[{"name":"Default","value":{"colors":{"c162b":{"val":"var(--tcb-skin-color-0)"}},"gradients":[]},"original":{"colors":{"c162b":{"val":"rgb(19, 114, 211)","hsl":{"h":210,"s":0.83,"l":0.45,"a":1}}},"gradients":[]}}]}__CONFIG_colors_palette__
Previous Article
__CONFIG_colors_palette__{"active_palette":0,"config":{"colors":{"c162b":{"name":"Main Accent","parent":-1}},"gradients":[]},"palettes":[{"name":"Default","value":{"colors":{"c162b":{"val":"var(--tcb-skin-color-0)"}},"gradients":[]},"original":{"colors":{"c162b":{"val":"rgb(19, 114, 211)","hsl":{"h":210,"s":0.83,"l":0.45,"a":1}}},"gradients":[]}}]}__CONFIG_colors_palette__
Next Article

Property Investment... Effortlessly Done For You!

>