This is an excellent opportunity to invest in a brand new property in any of the above locations with only £1000 ($2000) required. See the example process below:-
• £1000 ($2000) non-refundable reservation fee required for reservation of a specific property.
• 30% deposit required (less £1000 ($2000)) within 45 days of reservation. Should you choose to borrow the 30% deposit, the developer will pay the loan repayments, including interest, for the 30% deposit until completion of the specific unit you have reserved. These payments will then be added to the purchase price upon completion.
• Example (Sterling): Property price £200,000. £1000 reservation fee paid. The deposit = £200,000 x 30% = £60,000 – £1000 (reservation fee) = £59,000. Interest on £59,000 @ 6% p.a. = £295 per month, paid for 24 months by the developer = £7,080 added to the purchase price upon completion.
• Example (US Dollar): Property price $370,000. $2000 reservation fee paid. The deposit = $370,000 x 30% = $111,000 – $2000 (reservation fee) = $109,000. Interest on $109,000 @ 6% p.a. = $545 per month, paid for 24 months by the developer = $13,080 added to the purchase price upon completion.
Due to the significantly discounted off-plan contract price and the capital appreciation during the construction phase, it is anticipated that the £200,000 ($370,000) purchase price will have grown to a property value at completion of circa £325,000 ($601,250)
At this point a 70% loan to value guaranteed mortgage is available and therefore you will be able to borrow up to £227,500 ($420,875). This is clearly ample to pay for the £199,000 ($368,000) (purchase price less £1000 ($2000) reservation fee) that you owe as well as the accrued interest of £7,080 ($13,080) – from the above example.
Assuming you borrowed the maximum loan to value mortgage, available from the example above, you would borrow £227,500 ($420,875) on which the annual interest payment would be £18,200 ($33,670) based on a rate of 8%. The rental guarantee of 10% of your purchase price of £200,000 ($370,000) will generate you an income of £20,000 ($37,000) each year, should cover your mortgage payments. If you wish you could retain the £59,000 ($109,150) loan you took out for the deposit, pay the interest yourself each month, from completion onwards, and use the money to invest in a further investment property purchase.