We did CF first until free, now we mainly buy in the middle 3 bed semi's with 1 CG property. In the next few years we will probably sell off the good CF's and put into middle and CG, it is better tax wise to re mortgage rather than get taxed on income
CF all the way for me. Take care of the pennies and the pounds will look after themselves as they say. CF let’s you grow quicker and when you reach your goal then you can retire without having to consider CGT or alike. Plus CG will come around eventually, certainly in time for most of our children’s adulthood which is generational wealth personified as I understand it.
8.28 Jamie on your figures (illustrated) you're not getting £60K per annum... you're getting 3K per annum and over a 20 year period you're getting £60K ROI. Personally, I don't like these low-end properties, specifically for this reason, i.e. no substantial growth in investment over time. Outside London your best investment, for instant healthy rental returns and growth (over 10 years not 20 years) would most likely be certain areas in South Manchester... (free tip there, but if you want to send me a drink that's fine)
CF through dividend paying stocks and CG through property. Dividend paying stocks is the most passive investment asset class ..no tenants, council fees etc. Buying a property with good fundamentals will ensure CG plus the depreciation associated with IP is an advantage. CF is what allows you to stay in the game , CG is what allows you to exit the game.
A bit of both for me, But as you say everyone’s situation and plan is different, do what’s right for you and enjoy it👍 I’m in for 20 years minimum with every purchase and will just pass on, no intention to ever sell any property.
I think most investors get distracted with cashflow because it's instant. Need to have a mindset of 25 years + (if you're young enough!) and CG wins hands down. Some of those London mansions are just sitting empty because the cashflow is relatively small.
Very very interesting point on compounding. How about two other things I'm thinking (correct me if wrong): capital growth of e.g. 5% pa is on a leveraged investment (ie, 5% of house value, not 5% on deposit), also that capital growth in most good areas is multiples higher than rental income anyway. So if you're looking for pure ROI, then capital growth being a large number, which is also leveraged will make a larger portion of that ROI. Then you factor in compounding.... Thoughts?
That will happen everyone and then and there are some in negative equity, but as a percentage it’s actually very low so I’m happy with that happening from time to time 😊
I've currently got a really high end 2 bed rental flat just outside Liverpool City centre on the River front. The ground rent is annoying (guessing that's why you don't like flats) But I feel purchase price of 135k is a steal and really thinking CG and CF will be amazing so reluctant to sell it off for a house
@@rineditor7077 that is more central than mine. Plus I bought mine 6 years ago I'm not telling you where mine is (especially if you're not a scouser investing from down south) 🤣
Dividend paying Stocks would be the best way to earn CF. Unlike property, you can get started with little as $500 in the stock market. Also look into REITs (Real Estate Investment Trusts) if you are keen in property as an investment class.
I have an issue. Every 15-yrs my properties need repairs & upgrades, e.g boiler repairs, new floor coverings, repainting or wallpapering. Whether, it's CG or CF. Can u suggest helpful solutions or even plans pls?
Not even generational wealth, with capital growth you can remortgage, to take that growth out from the property. For example, if the value of property doubles roughly every 10 years, then if you bought a property in 2011 for 100k, 25% down mortgage mortgage 75k, and that property has now doubled in value to 200k, you should be able to withdraw £75,000 out of the property, this money is tax free as it's a loan, but that's a deposit for 3 more houses.
I like cash flow, so i tend to invest in popular areas. Would you rather have 10 pounds today? or a 100 pounds in 10 years time? You could be dead in 10 years time ;)
On paper I am financially free, but if I quit my job I am no longer mortgageable. Other than paying off my current mortgages, I can't see a way out. Any ideas anyone?
My earned income is what I call ‘suck money’. My property income is ‘yacht money’. To me, income is the key. As you say, I buy in the North East and get a 17-25% return on my cash. There is no other asset that provides that level of return.
I have a property in Norwich and a studio student flat in Bradford and I thinking to buy a luxury flat or 2 bedroom house in Liverpool for CS. Is Liverpool a good investment area?
Really thanks for the video! Much appreciated. In my case its the bottom line. i.e: CF+CG So if CF is 7% and CG is 7%. Thats a 14%. I really dont mind if this 14% comes from a cash flow or capital growth. I always considered high cash flow a sign that the property is good for future capital growth. As I always considered a high cash flow as a sign that the property is wanted and good, this should normally lead to capital growth. What do you think? on the other hand. if the property is increasing in value but the rent is not increasing. Isn't this a red flag that the property price is inflated in a bad way?
Great content Jamie I’ve always been verging on number 3 , concentrating on CG and not earning much on the cash flow side as I’ve never contemplated on giving up my day job ( after all this is where my main sources funding comes from ). I’ve nearly always had repayment on my mortgages + the 10 yearly payments with the aim of building capital growth over time ( and I know there’s lots that wouldn’t agree , but it’s worked for me and I’m happy doing it while I’m still working ) I’m now in a position where I can take good capital out AND capitalise on rates of approx 1.6% meaning it’s a lot cheaper now to borrow . I’m also changing a couple of those properties where I’m refinancing to interest only and with a bit of jiggling about paying less each month across the board . Buying properties at the minute is a little uncomfortable as there’s a mini boom going on and I do think a correction is on its way …..so il be ready to pounce when ( or if ,) it happens . I’m still actively looking at the minute but don’t want to be in a position of overpaying as the prices have rise so dramatically ( even ooop north lol)
Lots of CF to achieve CG they go hand in hand and like so many things in life balance is critical. I am currently Straddled across the two to achieve balance working down the years until not only do I have financial freedom but also the ability and scale to act on opportunities
Depends on how you're leveraging the property. Obviously, In theory a HMO is great for CF however your commercial value is usually seen more than bricks and mortar value so the CG is less accurate
@@JamieYork agree. If it’s a commercial valued HMO. I think from Denzil’s question he’s probably not doing large commercial HMO’s. He’s likely probably going to start with a 4 bed hmo
Cash Flow primarily which will allow me to move into property full time. Then lock in that wealth with some great balanced cash flowing capital growth properties!
If were looking at property for a 5% year on year return with little cash flow, wouldnt that money be better in the S and P 500 with a 10% year on year return if were looking at average over the last 65 years?
I look for CF, i'm just refinancing 1 property to buy 2 more, so cashflow certainly helps covers costs and more. Any thoughts on fixing term for 2yrs or 5yrs??? Im leaning toward 5yrs, as surely interest rates will be going up soon.....
I think Jamie said on a previous video that of you are confident that you won't want to quickly refinance, he is more tempted to a 5yr fixed at the moment. But if you are likely to refinance to get more cash out of the property (say after a refurb) then perhaps don't do a long term fixed as you will have higb early redemption charges, which could offset the initially perceived saving on a monthly basis.
@@rachelyvonneblythe Thanks Rachel, i have already started the process and agreed the 5yrs, great to get the feedback from fellow investors like you. Sometime you just need someone else to back you up on it :)
CF - Great video. I have 3 properties in the South East that have been good for CG, but okay for CF recently. Your video is very timely as I am right now working out a plan to be financially free from the day job by using released equity from the first 3 properties to buy better cash flowing properties elsewhere. So I am going from Stage 2 to Stage 1 then once financially free on to Stage 3.
Jamie - such a FAB video! So refreshing to see someone who seems honest and genuine! ALSO, have you heard house prices are predicted to go down in Q4 and early next year? Maybe I'm best waiting rather than jumping the gun. I need to have a real look at areas where CG is high. Best to keep looking?
Hey, Some great points here! Maybe a correction coming but it's not going to be massive or you could be waiting for a long time. People said there was one coming from Brexit, covid, etc and it's not happened yet! I'm sure a part Yorkshire girl might be able to see the potential in West Yorkshire for CG. :)
@@JamieYork AHHHHHH how did I miss this comment!! Haha thank you so much! You psychic! My mum's from Yorkshire but I'm from Manchester so I'll be buying there. My first go at this property thing and I'm just not as brave as you but I have to start some time - and you're right, people have predicted house prices will drop and they still haven't really. If I can get the right price, I'll be able to make a steady small income - and hopefully long term gains. Thank you as always for your FAB advice! Glad I found you x
CF and CG, yield from our two rentals is c. 5% which pays well after all costs and tax. Although still in a great area of the South West, with impressive CG figures. Love your videos keep it up!
Excellent post, always thought stage 2 was best, never considered stage 1 to fund stage 3. But wouldn't it be better to use funds from stage 3 to buy multiple stage 2's with the leverage that produces?
Will London remain a capital growth city?: Brexit Highway infrastructure Covid 19 and work from home from other cities? I wish if London remains a good place for capital growth as I live and work in London
Just found you on RU-vid Jamie.. really like your to the point info. I have read about keeping 'investment ' property separate from trading properties. What could you advise?
Great video as always, just a rough idea….which I know can vary depending on area/circumstances etc; how much would be a good amount of money to start with? Thanks!
Thanks! Would be great to work together! Head over to www.aspirepropertygroup.co.uk/? and fill in your details, and a member of my team will be in touch! 😊
