Keen to invest in London property but can’t afford it? You’re not alone. The average house in London now costs £514,000 whilst an average two bedroom flat in Chelsea will set you back £1.65 million.
Average house prices in the capital are now well beyond the reach of many people, let alone those aspiring to invest in prime areas.
This unaffordability is one of the reasons shared ownership schemes have started popping up offering buyers the chance to pool their resources and get on the property ladder with other buyers.
One such model has just been launched by private equity property fund specialist Rocksure. Its new London Fund takes one-off capital sums of as little as £122,500 and puts these together with others to provide co-ownership of a portfolio of four prime London residences.
The properties, expected to be located in Kensington, Chelsea, Westminster and Covent Garden, are all owned by the shareholders, who can use them for between 10 and 18 nights each year, depending on their level of investment.
The fund will liquidate after 10 years, at that point all properties will be sold and the proceeds together with any capital gain will be distributed amongst shareholders.
Of course, while capital gains in London are sky high right now, they aren’t guaranteed. Unforeseen events in the global economy, while one property firm predicts London will see no price growth in 2016.
But Rocksure chief executive David Rogers says with Rocksure set to buy the properties in Spring next year, slowing price growth in London is actually a good thing as it sets the company up to enjoy better price growth over the 10 years of the investment.
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