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The monthly magazine providing news analysis and professional research for the discerning private investor/landlord

Investing in Residential Development

Editor Richard Bowser reports

Without question the property investment marketplace is now more complex and challenging for investor-landlords and some of the previously tried and tested strategies are now producing lower returns or now come with some enhanced risk.

In the aftermath of the 2008 financial market crash many property developers who wanted to commence new projects found that banks were risk averse as they rebuilt their reserves. The result was that many small-scale developers and investors looked at private funding arrangements via fixed interest loans or put together joint venture partnerships with contractually agreed profit shares.

Many residential schemes have been successfully built in recent years by small-scale developers, which resulted in their investors enjoying some great returns. Of course there have been some exceptions over the years, where for a variety of reasons, projects did not turn out as expected and the recent pandemic also exposed some developers working on overly thin margins.

So what should anyone with a chunk of savings earning little in their bank account be considering if the options of direct investing via buy to let now hold less appeal? Well, one option would be to partner up with a developer and part fund a project but the issue with that is that you could have all your funds locked in with one scheme.

And what are the options if you want to access the higher returns that can be achieved from successful property development projects but are wary of ‘putting all your eggs in one basket’?

Well one company seems to have found a solution and with a 25-year history in property development they appear to have refined a winning formula in recent years through working with private investors on multiple development projects all around the UK. 

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