The Axis Smart Guide:
Property Investment
in Scotland





(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 1

---

Pr
by op
Ro
ed Thormtyas F InCA vestment In Scotland
Why Scotland?
If you live in England, you could be forgiven for thinking that Scotland is a different country and a long way
away. Of course if you live in Scotland the reverse is true.
When appraising property investments in Scotland,
Axis investigates the long term value of the property,
the local demographics and their impact on potential
property prices.
So what exactly is the attraction of Scotland as an
investment destination for smart property investors?
Let's consider the eight main reasons to invest in
Scotland:
Pricing stability
With some exceptions, Scotland has not suffered from huge price increases or severe price falls. For an
investor valuing steady growth and stability, that's a good background for investment.
Rental Demand
Scotland has a thriving rental market with a higher proportion of renters than in England. Again, for a buy to
let investor, this is good news.
Rental Yields are Good
We only offer rental yields with a minimum gross return of 7.5% pa and often higher; 8.5% is relatively
common. This contrasts with England where only this afternoon I am weighing up whether to offer property
to our investors with a yield between 4.7% and 6.5%.
The high rental yields mean that you can be confident of positive cash flow and peace of mind.
Deals Actually Happen
If you are investing in England, mortgage valuations continue to be a source of anxiety and deal failure with
considerable risk in the transaction progressing to completion. Typically 30-40% of transactions in England
currently fail. In Scotland the success rate is far higher - 90% or more which is great news for investors.
(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 2

---

Regular Stock
If you are intending to build a portfolio, Axis can offer you a regular stream of property across Scotland.
Resale Property
Most of our deals in Scotland will be resale property. That means very competitive pricing and no saturation
of the local market that can happen with new build property. You can also gain a higher percentage of
mortgage funding with resale property.
Low Money Down
We offer the complete package in Scotland including bridged deposit, resulting in Low Money Down
property purchases.
Easy Legals
Most investors know that the legal system in Scotland is different from England. We describe the process in
this Smart Guide. The bottom line is that it's easier to buy in Scotland and there is less likelihood of the deal
falling through.


(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 3

---

What Type of Property Does Axis Offer In Scotland?
The majority of our investment properties offered in Scotland are what we call Type 2: Resale properties.
Each property offered is individual, either an apartment or a house and generally located in one of Scotland's
four major cities.
What you can be sure of is:
a) All properties will be substantially discounted from true RICS (Royal Institute of Chartered Surveyors)
current valuation. Typically in the region of 25%.
b) All properties will have a generous rental yield - typically a minimum of 7.5% gross.
c) All properties will be fully packaged for a Low Money Down deal using assisted deposit finance. Typically
this means that the total investment required, including all fees and costs, is in the range of £5,000 to
£10,000.
d) Most properties wil come with the Axis Five Star Guarantee, including a 12 month
rental guarantee! Check it out at http://www.axispropertyinvestment.com/five-star-
guarantee.html

What Kind Of Investor Is Scottish Property Appropriate For?
Most properties, as we have mentioned, are Axis Type 2 Resale Property. This investment strategy is perfect
for investors who prefer to avoid large developments and new property.
Resale property tends to have higher rental yields and it is easy to compare both market price and rental
value. For these reasons the risk is lower and this suits investors with a conservative approach but still
requiring good rental returns.
If we now add Scotland into the mix, our view is that investments here are a little more conservative and
reliable than the rest of the UK. Prices didn't go up as high in the recent boom, nor have they suffered so
much in the 'bust'. Investors can reasonable expect fair growth and solid performance - which is a very
positive attribute for property investors.
If you want minimum hassle, low risk, a good choice of well priced property with excellent discounts and
high rental yields, then Scotland should be on your shortlist of 'first choice' property locations.


(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 4

---

Sample Properties
These pages il ustrate the type of properties available which change on a continuous basis. Please call us for
the current list of property or download from http://www.axispropertyinvestment.com/uk.html.
Blythswood St, Renfrew, PA4 8NU

Property Type: 1 Bedroom Flat
Accommodation compromises of:
Hall, Lounge, Kitchen, Bedroom 1 and Bathroom

Structure of deal:

v Market value £75,000
v Investor price £56,250
v Discount from market value 25%
v Immediate equity £18,750
v Purchase price on contract wil be ful Market Value price
v Estimated rent £350 pm
v Rental yield of 7.46%
v 75% LTV Mortgage available subject to status
v 25% deposit provided through bridging facility
v Reservation of £1,000 required to secure purchase (final balance reduced by £1,000)
v Investor to use recommended solicitor
v Lettings and management service available

Financial details:
Based on BM Solutions 75% LTV 4.70% interest rate. 2 year tracker

v Loan amount of £57,937 (including 3.0% arrangement fee)
v Monthly payments based on 4.70% interest rate of £227
v Rental income of £350 pm
v Cash positive rental income of £123 pm
v Total cost to purchase c. £6,000
(


c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 5

---

Hattonrig Rd, Hamilton, ML4


Property Type: 1 Bedroom Flat
Accommodation compromises of:
Hall, Lounge, Kitchen, Bedroom and Family Bathroom

Structure of deal:

v Market value £67,000
v Investor price £50,250
v Discount from market value 25%
v Immediate Equity ££16,750
v Purchase price on contract wil be ful Market Value price
v Estimated rent £350 pm
v Rental yield of 8.35%
v 75% LTV Mortgage available subject to status
v 25% deposit provided through bridging facility
v Reservation of £1,000 required to secure purchase (final balance reduced by £1,000)
v Investor to use recommended solicitor
v Lettings and management service available

Financial details:
Based on BM Solutions 75% LTV 4.70% interest rate. 2 year tracker

v Loan amount of £51,757 (including 3.0% arrangement fee)
v Monthly payments based on 4.70% interest rate of £202
v Rental income of £350 pm
v Cash positive rental income of £148 pm
v Total cost to purchase c. £6,000


(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 6

---

Pond Walk, St Helens

Property Type: 3 Bedroom semi detached
Accommodation compromises of:
Ground Floor: Hall, Lounge/Diner, Kitchen. First floor: Bedroom 1, Bedroom 2,
Bedroom 3 and Family Bathroom

Structure of deal:

v Market value £85,000
v Investor price £63,750
v Discount from market value 25%
v Immediate Equity ££21,250
v Purchase price on contract wil be ful Market Value price
v Estimated rent £450 pm
v Rental yield of 8.47%
v 75% LTV Mortgage available subject to status
v 25% deposit provided through bridging facility
v Reservation of £1,000 required to secure purchase (final balance reduced by £1,000)
v Investor to use recommended solicitor
v Lettings and management service available

Financial details:
Based on BM Solutions 75% LTV 4.70% interest rate. 2 year tracker

v Loan amount of £65,662 (including 3.0% arrangement fee)
v Monthly payments based on 4.70% interest rate of £257
v Rental income of £450 pm
v Cash positive rental income of £193 pm
v Total cost to purchase c. £6,000


(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 7

---

Wallace Place, Kirkmuirhill, Lanark, ML11

Property Type: 3 Bedroom Semi detached
Accommodation compromises of:
Ground floor:- Hall, Lounge, Kitchen and Dining Room
First Floor:- Bedroom 1, Bedroom 2, Bedroom 3 and Family Bathroom

Structure of deal:

v Market value £93,000
v Investor price £69,750
v Discount from market value 25%
v Immediate Equity £23,250
v Purchase price on contract wil be ful Market Value price
v Estimated rent £450 pm
v Rental yield of 7.74%
v 75% LTV Mortgage available subject to status
v 25% deposit provided through bridging facility
v Reservation of £1,000 required to secure purchase (final balance reduced by £1,000)
v Investor to use recommended solicitor
v Lettings and management service available

Financial details:
Based on BM Solutions 75% LTV 4.70% interest rate. 2 year tracker

v Loan amount of £71,493 (including 2.5% arrangement fee)
v Monthly payments based on 4.70% interest rate of £280
v Rental income of £450 pm
v Cash positive rental income of £170 pm
v Total cost to purchase c. £6,000


(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 8

---

Your Questions Answered
I'm concerned about managing the property when it is so far away!
This is a major decision for all investors. Do they invest locally or further afield? The best answer I can give is
based on my own experience. I have a specific investment strategy which I cannot achieve where I live
(Brighton, South Coast). Properties are too expensive and yields are too low. So almost all my portfolio is in
the North West. I haven't visited my properties for 4 years - in fact not even the properties closest to me!
The issue is simple. Once you have good management in place then you don't need to visit - it will all be
handled for you. Some investors like to micro-manage everything and I respect that. For these investors
buying at a distance wil never be comfortable. Other investors are only too happy to delegate the
management and don't care if they invest the other side of the world.
You need to decide which camp you fal into and whether you are comfortable with the distance. Like most
things, familiarity makes things easier and so your first investment will always be the most difficult.
What equity will I have in the property?
You will have 25% equity in the property, calculated from a RICS valuation, not some 'guestimate'! So you
will buy a property with a true value of (say) £100,000 for £75,000, giving you £25,000 instant equity.
What costs are involved?
There are various fees and costs as there are in any property transaction:
· Legal fees
· Bridging fees
· Mortgage arrangement fees
· Axis finders fee
· Disbursements etc
Typically these will amount to around £5,000 to £10,000 depending on the property. The Axis approach to
"Low Money Down" ensures that this is way below the £30,000 or more that you would have to contribute
to a traditional purchase transaction, and you also benefit by the substantial equity due to our negotiated
discount on your behalf.
How long does it take to complete a purchase?
Typically 6-12 weeks. The entire process takes longer than it used to.
What do I need to qualify for a mortgage?
This varies according to lender but a good start would be:
1. Own your own property and have no mortgage arrears
2. Earn at least £25,000 per year, provable for three years
3. Excellent credit score. No CCJ's, no defaults
4. UK Resident
If you think you could be borderline we can arrange to have a Decision in Principle done prior to you
reserving a property.
(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 9

---

Do I rent unfurnished or furnished?
The great majority of properties will let unfurnished. Landlords prefer this - less wear and tear and less
hassle - and many tenants have their own furniture.
Tenants with furniture tend to stay longer as you might expect.
However, contract workers, students and young people usual y require furnished accommodation and
where appropriate it is worth furnishing cheaply to gain the maximum rent.
Where will the investment property be located?
We have property finders in all major city locations.

Clearly the discount we can obtain and the real rental yield obtainable determine location to a great extent.
Properties in Paisley, Irvine and Kilwinning tend to be less expensive to buy than those in Ayr, Troon and
Prestwick - yet rental levels are either slightly below or equal to the more expensive housing areas.
Over the last thirty years there has been a boom sales market in London and investors have used the ‘next
station along’ principle when speculating in property. This ripple effect can be seen in Glasgow’s West End,
Kilmarnock and Ayr. The current upgrading of the A77 and continued expansion of Prestwick Airport is
having a very positive effect on house prices throughout Ayrshire.
In general properties are sourced from the Glasgow-Edinburgh corridor and down the West coast to Ayr. We
tend to avoid cities further north where rentals are less certain and rental yields lower. Dundee and
Aberdeen are occasional exceptions to this.


(
c) 2010 Axis Property Investment. Al rights res rved worldwide
Page 10

---

Document Outline

• Why Scotland?
  • /Pricing stability
  • /Rental Demand
  • /Rental Yields are Good
  • /Deals Actually Happen
  • /Regular Stock
  • /Resale Property
  • /Low Money Down
  • /Easy Legals
• What Type of Property Does Axis Offer In Scotland?
• What Kind Of Investor Is Scottish Property Appropriate For?
• Sample Properties
• Your Questions Answered
  • I'm concerned about managing the property when it is so far away!
  • What equity will I have in the property?
  • What costs are involved?
  • What do I need to qualify for a mortgage?
  • Do I rent unfurnished or furnished?
  • Where will the investment property be located?
• Glasgow (pop 1,179,000)
• Edinburgh (pop 467,950)
• Aberdeen (pop 192,000)
• Dundee (pop 151,800)
• What Next?
• Step One
• Step Two
• Step Three
• Contact Details
  • Legal Disclaimer
  • Misrepresentation Act 1967 Notice
  • Copyright Notice Warning
    • This brochure comprises and contains copyrighted materials.
    • YOU MAY NOT DISTRIBUTE, COPY, PUBLISH OR USE THE TEXT OR IMAGES OR ANY PART OF THE TEXT OR IMAGES IN ANY WAY WITHOUT EXPRESS PERMISSION OF THE COPYRIGHT HOLDER. YOU MAY NOT ALTER, MANIPULATE, ANY PART OF THE TEXT OR IMAGES WITHOUT PRIOR WRITTEN CONSENT.
    • Copyright for all images remains with Actium Property Ltd.
    • Al enquiries regarding use of and purchasing prints and image use rights must be directed to the Copyright holder. All rights reserved. All images included herein this publication are the copyright and property of Actium Property Ltd. All images and t...

---