Equity Share
Investors
EquityShare is a neat way of gaining exposure to residential property without the up-front costs and management headaches associated with direct property investment.
Compared to direct investment in property: This entails heavy startup costs, running expenses, and (if you are a landlord) an awful lot of regulatory compliance. For this you may get a rental yield of 3% if lucky.
Compared to savings: You can get about 3.5% on fixed term deposits, if you keep moving the money around. The capital doesn't grow.
Compared to pensions: Annuity rates vary from 3% to 9% depending on age. This includes the progressive return of capital, so that at the end of the period there is nothing left.
What's different about EquityShare? Well, ask yourself: where else can you get a return of 5%, while watching your capital grow in line with house prices. Since 1973, house prices have grown at an average of 8% a year? This means that if the trend continues, your aggregate gross return could be around 12 - 13%. You have to pay tax on this, of course, but part of it is a capital gain and so is taxed at 18%.
Is there a catch? You have to appreciate that house prices can go down as well as up. So you could lose money, especially if there is a double dip recession. But most people consider, and with good reason, that bricks and mortar are a pretty reliable investment.
Where do I start? Speak to your financial adviser who will talk to us. We do not sell this type of investment direct, but only through IFAs or mortgage brokers.
What is a good sum to invest? Entirely up to you, but we set a threshold of £10,000. Investments of £25,000 are popular. Larger investments of £100K or more may attract bonuses.