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A new way to invest in
residential property in 2019

What is HOP?

HOP (Home Owning Partnership) is a new way to invest for hassle-free, long-term inflation linked-income of around 4.5% net of costs.

With HOP you can invest in residential property alongside a buyer, who will occupy the property on a long-term HOP lease; sharing capital growth and downside risk.

What is the HOP lease deal?

  • HOP finds a suitable property, chosen by a potential buyer, who would like to occupy that property under the HOP lease deal.
  • You invest in property (maybe a freehold house or normal flat lease) and sell a 125-year lease to the buyer for 10% or more of its value, with a rental to give you a 5% gross annual return based on the 90% value you retain.
  • This rent increases each year by 0.5% above the inflation, as measured by Retail Price Index (RPI), with a cap at 5% increase each year.
  • All repairs and maintenance responsibilities are passed to the tenant who also reimburses insurance costs, so there are no costs or hassle for you.
  • HOP manages the deal and charges 7.5% of rents plus VAT.
  • All provisions of the HOP deal are set out in the HOP lease, on which you are advised to take independent legal advice.

Investor Benefits

HOP increases your net yield; there are no letting fees, no voids, no maintenance and repair costs and no insurance costs.

Reduce hassle and risk of being a landlord – HOP sources, purchases and manages the homes and arranges for long-term leases to buyers.

Your net income yield of around 4.5% increases contractually by 0.5% plus RPI each year (capped at 5% each year).

Buyers have invested in their homes and tend to look after them better than rental tenants.

No voids – 100% occupancy for 125 years until sold!

No maintenance, repairs or insurance costs – buyers look after the property at their own cost and reimburse insurance costs.

Buyer investment interest in the property is at risk in default or non-payment – a much larger sum than is normal in renting – so your recovery of arrears is more likely.

Residential asset-backed exposure and house price inflation – with shared upside.

The right product to tackle the affordable housing crisis – providing home ownership for people who are stuck in the rented sector.