» David Mackenzie Private Rented Sector Update

Don’t Play the Games

March 5, 2012 by David Mackenzie 1 Comment

Last year, I wrote an article looking at the pros and cons of letting property for the short term with an eye to maximising rental income from the Olympics. At that time, a year ahead of the Games, I cautioned against trying to ‘cash in’ by highlighting the practicalities involved:

• Potential voids
• High agency fees for short term lets
• High turnover of tenancies (typically 3-4 nights at a time)
• Local authority short–term letting restrictions and licensing
• Leasehold restrictions on short –term lets at apartment buildings
• Potential for a glut of property coming back to the market post-Games

My recommendation was to think very long and hard before turning away from the security of an incumbent long-term tenancy as the pros looked distinctly outweighed by the cons.

But add to this the fact that demand for short term ‘Olympic’ rents is yet to materialise and it seems even more prudent to steer well clear.

Our philosophy is to always look at the big picture and to take a long term view of your property assets and associated returns; after all, property investment isn’t a game.

Filed under Asset Management, Investment Tagged with 2012, business, finance, investment, lettings, london, money, olympics, property, real estate, rent

Leverage, Gearing and Debt

January 9, 2012 by David Mackenzie Leave a Comment

‘Leverage’, ‘gearing’ and ‘debt’. The terms may sound a bit esoteric but all essentially mean the same thing; borrowing money to buy an asset.

The person on the street typically uses leverage to buy property. Providing you have a cash deposit, banks will look at your employment/income and creditworthiness and can lend against this simple premise.

Debt can be considered a ‘bad’ thing to have. Generally homeowners look to pay off their mortgage, typically over a 25 year period, in order that they have an unencumbered (owned outright) property later in life. That is understandable and commendable for anyone purchasing a family home. Read more of this post

Filed under Investment Tagged with debt, finance, gearing, investment, leverage, money, property, real estate

Olympics 2012 – Hassles and Heartache?

September 5, 2011 by David Mackenzie 1 Comment

Olympic Stadium (London 2012)

We recently passed the ‘one year to go’ marker for the 2012 London Olympics. Over the next 11 months excitement will grow in the capital as more obvious preparations begin, and next summer is going to be one to remember.

But the Olympics and their ‘legacy’ extends far beyond that of the games itself. If I could have £1 for every time an existing landlord has asked me over the past few months: ’is there an opportunity to exploit the short term rental market for London 2012?’… Read more of this post

Filed under Investment Tagged with 2012, business, investment, london, money, olympics, property, real estate, sport

Investing in the Kings Cross Lettings Market

June 13, 2011 by David Mackenzie Leave a Comment

Kings Cross Lettings Market (image: Joshua Albers)

I have been struck over the past few weeks at the strength of the Kings Cross lettings market.

As a company we invested in the Kings Quarter development in Kings Cross 5 years ago. The transport infrastructure is outstanding; 7 tube lines interchange at Kings Cross, the Eurostar is based here as is the rail network serving north of London as far as Scotland.

The planned regeneration of the old train works area to the north of Kings Cross mainline station is highly ambitious and far-reaching. The next decade will see it be a home to new retail, commercial and residential buildings, bringing tens of thousands of additional jobs, residents, students and visitors.

Part of the Kings Cross redevelopment will see the opening, in Autumn 2011, of the new campus for Central Saint Martin’s University of the Arts London (CSM). Between this and the Archway campus the university will play host to some 4,700 students and 1,000 staff.

Asset Management Grand and Small

May 9, 2011 by David Mackenzie 1 Comment

Bowood Hotel

On a recent visit to a magnificent stately home with copious grounds in Wiltshire, I was taken aback by how well the estate is run and by how up-to-date and commercial the thinking is.

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It is perhaps a misconception that the ‘landed gentry’ have endlessly deep pockets with which to run their family estates – this may have been the case a hundred ye ars

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or more ago, but the economic reality has to be faced in the twenty-first century. Plenty of homes are now open to the public – and ‘home’ is not just a title, it is often the building in which

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the owners reside.

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Due to high running costs the public are invited in to certain areas of the house, in order to admire the history of the building and to appreciate the architecture, furnishings and general ambiance of the place. This is one of a number of revenue streams that large home owners are turning to in order to assist with cash flow.

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