Tag: UK

NFIB and WIA to Provide Better Protection for Wine Investors

Millions of Britons enjoy drinking it and many now see it as a long-term investment. Unfortunately, fine wine has also become a focus for fraudsters who trick investors into buying wines or vineyards that bear little resemblance to what they see in the prospectus, or may not even exist. The increasing number of such rorts in Britain has led to calls for action to be taken to protect investors and to increase consumer confidence in fine wines. In the upshot, the UKs National Fraud Intelligence Bureau (NFIB) is joining forces with the newly-formed Wine Investment Association (WIA) to tackle the problem.

On 14 February 2013, the NFIB and the WIA jointly announced the launch of the new self-regulatory body which will aim to transform the growing wine investment industry by providing better protection for investors in the UK. The WIA has been formed by leading figures from the fine wine investment industry and seeks to support the sector’s growth through voluntary regulation, establishing best practices and setting up processes to identify fraudulent activity.

Director of the NFIB, Det. Supt. Dave Clark, said: “Fraudsters will always follow the money, wine investment is just the latest in a long line of investment opportunities that are being exploited and corrupted to the detriment of the industry as a whole. He added that the NFIB sees the creation of an auditable framework of self-regulation as a step towards maintaining and increasing consumer confidence, while also identifying investment companies which do not operate in accordance with the required high standards.

New Code to Tackle Wine Investment Frauds

Following an extensive consultation period, the WIA has set out the standards and procedures with which its members must comply to remain in good standing. Under the new code of conduct to be drawn up, wine investment firms will undergo stringent audits by accountancy firm Mazars. These will include checks on systems such as stock rotation and to make sure that purchase orders and invoices tally. The director of the WIA, Peter Shakeshaft, revealed that companies which successfully complete the independent audit process commissioned by the newly-formed regulatory body will bear a WIA logo offering consumers a trustworthy safety kitemark. Shakeshaft added: Our industry has been held back far too long by unscrupulous practitioners and issues around fraud. The WIA will really hold the industry to account.

Any investment diversification strategy should involve undeveloped land.

Dont trust the national numbers on housing values as the final word on all real estate investment. Regional differences are significant and opportunities abound.

The conundrum for investors who are intrigued with UK land and real estate is, with a growing population and so little building in the past decade, why arent more houses being built?

After all, Census 2011 showed a growth rate of about 7 per cent since 2001, a much healthier addition of population than most countries found in the Eurozone. England and Wales in particular are a strong draw for immigration, and the birth rate has remained relatively strong even through the financial recession of the past six years. Exacerbating this further, pensioners are living longer and in greater health, keeping granny from moving out of her granny flat.

Savills research offers some data and analysis that suggests some fundamental ways in which housing will be built in the years to come. It offers a different perspective to anyone involved in land development, as investment on UK strategic land and raw acreage is most adaptable to market needs before buildings are constructed.

Specifically, the firm offers the following data points:

Regional differences mask home prices Overall, homes in Britain have seen an average value increase of 6.4 per cent since 2007. Which is all well and good, except it masks the differences between North and South: in the South East and London, increases in home values are in the ballpark of 10 to 20 per cent. In the North of the country, values have fallen. This is not to say a land investment in those areas will not make sense, as real estate is sometimes tied to hyper-local factors. But the larger point is that in London and the South East, better opportunities are likely to be found.

Generation rental Of greater significance is the shifting of ownership to rental for many middle class families. Savills reports the value of Britains private rented stock has risen by 42 per cent over the past five years and an extraordinary 250 per cent in the past ten years. The 4.8 million private homes that are rented today represent 17 per cent of all dwellings, when just ten years ago to-let housing was a mere 10 percent of the national inventory. What has caused this? Increasingly, working families are unable to afford the necessary deposits required for purchase, and tighter lending standards by banks also make it more difficult to get mortgages.

Best opportunities for those with cash to invest All those rental homes still need to be built, begging the question: Who will finance them? According to the director of Savills research, There is now a real opportunity for investors with cash, particularly those ready to invest for income, because capital value growth will be muted over the mid term.

Real estate developers are on the front lines, constructing the right buildings for the market. But before they can do that, land investment companies identify parcels nearest to where building of one type or another should take place. This often is where employment is growing, or for any other reason the population is sufficient to fill new housing. Strategic land development will usually involve property zoned for agriculture or commercial or industrial purposes which local planning commissions will identify as more appropriate for residences, factoring for local economic conditions and growth opportunities.

Individuals who want to participate in land development and investing in real asset classes should first work with a qualified, independent financial advisor to be certain they are working with legitimate players and that the investment fits their overall financial goals.

Howard Hughes was, and Donald J. Trump still is, one of the richest men in the world, and they have one thing in common:

They bought land, in the right location and made fortunes from it!

You dont need to be Rich to Get Started!

If you have never considered investing in land, you should do. Its affordable and there are many specialist companies catering for inexperienced investors who have never invested before.

Theres no better low risk way to build long-term capital gains – as Donald Trump once said:

“I just love real estate. It’s tangible, it’s solid, and it’s beautiful.”

Howard Hughes was another who firmly believed in land investing as one of his high return investments, buying huge swathes of under developed land in California that came to be worth billions.

Where is the Best Place to Buy Land?

UK land offers an outstanding low risk, high return investment opportunity over the medium term. UK land has out performed most asset managers and asset classes – including investment trusts, unit trusts, equities and bonds.

Solid Long Term Gains

The facts speak for themselves:

Overall prices of farmland have increased by up to 30% in the last 12 months and 130% since the early 1990s with an average 920% growth in the last 20 years.

If you compounded a $50,000 investment, at last years average growth you would get a return of over $1.25 million dollars in just 12 years!

Of course, theres no guarantee, but with the growth rates weve seen over the last 20 years such gains are possible.

The future supply and demand situation points to higher growth in UK land values for many years to come heres why:

Population Growth – The UK is one of the most densely populated countries in Europe and its population is growing fast.

Immigration – In terms of immigration, 170,000 people are entering the UK every year. This figure represents over 60% of the annual population growth. At current rates of growth, the UK can expect to see at least 3.4 million more inhabitants within the next 20 years.

Social Trends – There is a rising divorce rate in the UK, and a declining marriage rate. This means there is a need for more homes as the family unit declines.

The UK government are already taking action to address the chronic shortage of housing, and are making house building a priority.

The Land Banking Opportunity

Land banking involves the acquisition of land, which does not enjoy planning consent, in advance of expanding urbanization.

The price of an open space plot, not immediately subject to urban development pressures can be bought cheaply. When urban expansion occurs the land rises in value as planning consent is granted.

This then allows investors to sell at a significant profit.

Get started with Just $10,000

Today, there are many companies advising international investors on how to profit from UK land.

They look at the best locations and give all the facts, so an investor can make an informed decision on whether to invest. A typical minimum investment normally starts at just $10,000.

High Return Investments and Low Risk

High return investments with low risk dont come around very often, but we feel land is such an opportunity.

If you are considering high return investments, then land is ideal for the longer-term investor seeking significant capital growth potential.