UK Interest Rate remains at record low
IN the next month, we will see the fourth anniversary of the UK Interest Rate remaining at the record low of 0.5 per cent. It is also commonly accepted that this situation is unlikely to change in the short to mid-term future due to the potential negative effect of a rate rise on our very fragile economy.
For the average individual this stagnation of low Interest Rates either means potentially borrowing and mortgage finance (if you can get it) or more negatively, a poor return on cash deposits and savings.
The start of 2013 has seen an impressive rally in the UK Stock Market. A soaring rise, gaining over £100 billion puts the FTSE100 Index back to levels not seen since mid 2008.
Of course, this is good news for pension investors, but for many the volatility and intangible nature of the stock market as an asset class is still off putting.
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Of all the assets, property investment has had the most stable and sustained long-term growth and performance. In the current market, even relatively secure property investments are rewarding investors with yields several times over what they can expect to achieve with cash in the bank.
Reports from South Devon commercial property agents Bettesworths continue to illustrate how this translates into active demand in the Property Investment Sector and they have recently released two local commercial property investments to the market.
The Keep, is an office premises which lies adjacent to the former Castle Chambers close to the Magistrates' Court on Union Street in central Torquay.
The property has for many years been the Torquay office of local Chartered Architects Baldock Benns and Highway. The firm currently occupies the property on a 15-year lease from 2001 at a rent of £13,000 per annum.
With business of the tenant entirely unaffected, the investment is available to buy at off an asking price of £150,000. The property comprises approximately 1,750 sq ft of office space.
In Teignmouth, 7 and 8 Somerset Place comprises two retail shops both let on commercial leases, producing a healthy and sustainable rental income in an excellent trading location in the town centre.
7 Somerset Place is let to YMCA (Charity) on a lease from November 2003 (which is currently being renewed for a further term of 10 years) at a rent of £10,750 per annum.
8 Somerset Place is let to Face Electrical, an independent electrical retail supplier. The tenant has been in occupation for approximately six years (on a new lease from 2012) at a rent of £8,500 per annum.
With a combined rental income of £19,250 per annum from a Charity Covenant and an established local electrical operator (who has recently committed to another 10 years occupation), this investment offers a strong return on capital with offers being sought for the purchase 'In the region of £250,000.'
Both of these investments would be ideal for a SIPP (Self Invested Personal Pension). N.B These investment sales do not affect the trading business of any of the tenants.
For more information on these two properties, and other investment opportunities or general investment advice, contact Paul Bettesworth or Stephen Lofthouse of Bettesworths (01803 212021).
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