Overseas Property Investment

Example, off plan property investment and capital growth example.
The Global Property Group - The GPG
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Overseas Investment Properties

Overseas Property Capital Growth Example

Many investors and purchasers of holiday homes abroad are attracted by the high capital growth that is possible.

This example show the difference investing in property can make to net worth over a period of time.

It is a very simplified example and all figure are for illustration purposes only and are not a guarantee of future performance.

In these examples the existing mortgages are not paid off.


Mr & Mrs Smith

Current House Value £150,000
Remaining mortgage £50,000
Equity available £100,000
   
Decision - do not invest in overseas property
   
Assume 10% growth per year
   
After 5 Years  
Own House Value £241,577
Mortgage £50,000
Equity £191,577
   
Equity After 10 years £339,061

 

It is easy to see from this example that long term property investment can make a dramatic difference to a persons net worth.

 

Mr & Mrs Jones


Current House Value £150,000
Remaining mortgage £50,000
Equity available £100,000
   
Decision - Invest in Overseas Property
   
Invest in two properties at: £150,000
   
Required 30% deposit with costs = £50,000 each £100,000
   
Total value of investment property: 2 x £150,000 £300,000
   
2 years build time  

@ 5% UK interest only mortgage on the required £100,000 equity released from current house

(just £165 each for a couple).

£330pm
2 years interest payments £7,920
   
Capital appreciation 20% year during 2 year build 40%
Value after 2 years (£216k each) £432,000
Equity in investment property £132,000
   

Don’t sell at completion

(could invest in 2 more properties using new equity)

Rent out to cover mortgage - in reality rental income should provide an income but in this example we only assume covering costs.
 
Assume 10% growth per year
After 5 Years  
Investment property value
£574,992
+ own house £241,557
 

£808,649

Mortgages £350,000
Equity £458,649
   
Equity after 10 years £965,092


Please contact us if you would like more information

 

All figures are for illustration purposes only and are not contractual.

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