Life changing experiences

Well to be fair, so too was every bit of technology we now take for granted, that many years ago was also, "too good to be true". Yet a brave few, with open minds and open hearts created the modern world we've inherited. Whilst it’s easy for us to dismiss things out of fear or lack of knowledge, the following live case study is the personal success story of one of our clients who have kindly agreed to share their life changing experience with Propertyrush Ltd.

Propertyrush case study

Despite the "Recession", life goes on and twenty months have rushed by in which Joe and Karen Gordon have reaped the benefits as their buy-to-let property grew in value by £37,000 whilst also generating £7,000 in rental income after accounting for a BTL mortgage, that’s £44,000 in total or an equivalent return on capital (ROC) of 33% per annum.

Overview

Joe and Karen live in Peterborough and were kindly referred to me in September 2004 by their friends, who were also long-standing clients and friends of mine. I agreed to work with Joe and Karen through Kiskidee Ltd as their independent financial adviser.

We met in early 2009 to discuss Joe’s retirement later in the year at age 65, and Karen age 50 had also decided to adjust her lifestyle and spend more time together. They were both working hard within the care system and have a strong sense of community spirit.

Their priority had been repaying their mortgage and some loans that were costing over £2,200 p.m. We analysed the amount of income they would have after Joe’s retirement and agreed the best course of action would be to reconfigure their assets.

We helped reduced their monthly expenditure by £1,650 and simultaneously enabled them to allocate money towards investment for more income. We considered the so-called "Conventional Investments" ISAs, Pensions, Annuities, Unit Trusts, Bonds, National Savings and Deposit etc.

However Joe and Karen felt that "The Markets" would not be able to provide them with any particular guarantees or feelings of security that could potentially be gained by owning property. Therefore they decided to consider Propertyrush Ltd as an alternative.

First Steps to Financial Freedom

Propertyrush found Joe and Karen a 4 bed terraced property, negotiated the purchase price to £78,000, arranged a £60,000 buy-to-let mortgage costing £284 per month, assisted with the conveyancing, surveyed the property and managed the refurbishment for them.

The property was bought in April, rented from May 2009 by Letsrush Ltd (Propertyrush’s sister company) to secure a long term tenant at £825 per month. This netted £458.50 after the 10% letting fee of £82.50 per month and the interest only mortgage.

After reviewing Peterborough’s market conditions, we remortgaged the property in January 2011 and achieved a valuation of £115,000. This has allowed Joe and Karen to liberate £30,000 from there buy-to-let property which will now cost £422.10 netting them rent of £320.40 per month.

Whilst Joe and Karen’s rental income has dropped by £138.10 per month they have £30,000 for the next property, £25,000 Equity left in there buy-to-let property and even better this property now owes them nothing, not a penny of their own money.

Effectively it’s cost them nothing and will continue paying them an income of £3,844.80 per annum, provide a decent home to a family that needs a safe environment; and more potential for capital growth in the next five years as UK communities grow.

Too good to be true, right? I understand having worked as an independent financial adviser for the last 18 years with investments returning a fraction of what property has in that time. It is fantastic to comprehend 33% per annum when the media has been telling us for the last 3 years that property is heading south. They would never get it wrong, would they? Worst yet you can't even get 5% in the bank without strings attached, however these are "the figures". You can easily check them yourself.

Whilst we all know that our world faces challenging times ahead, we should remember that life has a duality about it that creates incredible opportunity and excitement too.

Joe and Karen’s decision to join Propertyrush was not only a financial one, it was community driven too. Joe remembers renting a hovel in his younger years and really wanted to provide a decent home for tenants. Joe said, "It’s a real investment that I feel truly connected with". Now Joe and Karen’s priority is to enjoy four holidays a year as they did last year.

(Picture of Propertyrush helping PECT plant 1,500 trees for The Forest for Peterborough with clients Joe and Karen Gordon and their dog Josh, Directors Paula and Reg Miller along with two staff members Alastair Norwell and Romell Yearwood.)

Further thoughts

This case is an example of people taking control of their money away from insurance companies, banks, brokers and foreign markets by investing locally in the UK. Joe and Karen now feel there’s local accountability for their money, whilst providing decent housing and work for local companies and tradesman etc.

It was great to see Joe and Karen's faces as we told them we had found another property for them. Karen was so pleased she baked a cake and brought it in.

If you have pension funds, ISAs, Bonds, Unit Trusts most of these holdings are linked to Shares, Corporate and Government Debt in "The Markets" which are at best chaotic and at worst schizophrenic as Benjamin Graham’s "Mr Markets" is up one minute and down the next. (The Intelligent Investor)

Do you know where your money is invested? No I don’t mean the name of the bank, insurance company, fund or stock broker you signed your cheque over to. Do you actually know who handles your money on the ground, who profits from your money before you do, especially when the Wizard of Osborne’s Project Merlin appears powerless to stop banks squandering our profits on Bankers Bonuses.

Is your money in a country you like, is it in companies you like, is your money actually contributing to the economy or community in which you live or is it just being used for pure speculation by money brokers?

If you care about these issues you should start thinking of different solutions for your money, wealth and family’s future security in the UK.

"Your mind must be like a parachute, it’s of no use at all unless it opens up." - Dr Joseph Murphy - The Power of your Subconscious Mind.