First Property at 22 with an Off-plan Investment

[Eamon Heggarty]

Hi all.

I'm 22 and from the UK and currently just bought my first property. I would just like to share my recent investment and how ive been able to pay for it with a new technique ive never heard off or seen.

It is a 1 bedroom apartment in a new off plan small 4 story block building in the city center of Birmingham UK.

The property is an off plan investment and its purchase price is 15% under market value at $117,000. The developer has set up a payment scheme whereby i (the RE) pays a deposit and legal fee to secure the property (3% off the property value). Then after this i make payments once a month for 24 months to cover the 30%. Therefore 30% off $117000 = $35,100. This is this divided by the 24 monthly to calculate my monthly payments ($35,100/24= $1462.50/month).

After the 24 month period i will secure a mortgage for the reminder of the property value ($81900).

ADDITIONALLY to this (this is the bonus ball) the developer has guaranteed 5 years rental income, weather they find tenants or not, i still get my $650/month rent cheque (-8% for management fees). Thus $598/month for 5 years guaranteed.

I am currently 6 months into paying the monthly installments and the property has appreciated to $155,000. (STILL OFF PLAN). "off plan" refers to a house/unit that has not yet been constructed, only planned.

All in all i think i've made a good invest and would like to hear what any of yous think, good/bad/ugly. 

Thanks :D