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Bluezone International
Purchasing Structure
Purchasing Structure
Bluezone International purchases residential buy-to-let properties in the UK at a minimum of 15% below market value. This is because we have access to pre- and post-auction properties where a discounted rate has been negotiated with selected auctioneers. Rental income in such instances reach 130% of mortgage payments, while all purchased properties have a guaranteed rental income year on year.
Due Diligence
To determine whether or not a project is a worthwhile investment, Bluezone carefully researches, amongst others the following:
- location
- socio-economic data
- population density
- employment
- credit risk
- personal viewing (Bluezone representative)
- checking legal pack
- comparables
The greatest advantage of this structure is the fact that Bluezone utilizes a maximum of 75% gearing on all offshore-purchased properties. Having to raise only 25% of the total purchase price of the property increases the potential growth exponentially, as the total income raised from tenants is poured into the remaining mortgage.
The discounted purchase price of these properties, coupled with a steady growth in property prices, makes it possible for clients to double their investment amount every 3 to 5 years.
Risk Management
Bluezone manages the risk for the client in the following ways:
- rental income is insured
- investors retain controlling interest in the property company (100%)
- valuations done by the Royal Institute of Chartered Surveyors (UK) (FRIKS)
- low number of shareholders per property
- no penalty for withdrawal after 2 years
- properties managed by a specialized UK property group
- term of investment only 3–5 years
- contingency fund.
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