Investing in the UK: how to “get it right”
Richard Penny, manager of TM CRUX UK Special Situations, tell us about the funds two main buckets:...
I’m sure someone, somewhere has done some research proving that moving house is stressful. It’s not only physically challenging, but emotionally too. And moving in a pandemic – with a new dog – just magnifies the anxiety! But moving house also represents a new start. So, what better time than following months of lockdown looking at the same four walls?
‘Home is where the heart is, even if you can’t remember which box you packed it in.’ — Anonymous
If, like us, you entered lockdown without a garden, chances are you wished on more than one occasion for some outdoor space. This definitely triggered some online browsing and we weren’t the only ones: Rightmove, a new holding in ES R&M UK Recovery fund, reported demand for rental property being up 33% compared to this time last year*, with Monday 18 May reporting the highest level of rental demand ever recorded in one day. Antidotally we sent our first inquiry into a new flat on the 19 May…
Purplebricks, a holding in VT Seneca Diversified Income, is another popular online destination for property hunting. Co-manager Mark Wright told us in his podcast how in a recent survey “it was deemed a more relevant brand than the likes of Apple and TripAdviser.” Looking to move, especially in London, is extremely fast paced – even during a pandemic! Social distancing and virtual viewing did not slow down the turn-over for sort-after locations and companies like Rightmove and Purplebricks are key to finding that perfect place.
There are very few moments when I’ve truly felt like a ‘grown up’, but buying my very first sofa and mattress ticked that box. From the moment we signed the lease on our new home, the design side of my brain was spinning: a blank slate to decorate and design, all with the added challenge of renting: no nails, no paint, no major renovations.
Determined to stay far away from generic Ikea products which have filled all our past rentals, I opted for primarily smaller names such as Oliver Bonas, West Elm and even some boutique shops I found online, which unfortunately are all privately owned and a dead-end for would-be investors.
Not everything is privately owned though. Dunelm, is one of the largest homeware retailers in the UK, with over 150 stores. And, for millennials on a budget it’s remarkable affordable. Dunelm is a top ten holding in both Edentree Amity UK** and AXA Framlington UK Mid Cap**. Next is another popular option in this space. From bedding to furniture and decor, it can quickly become a one stop shop (although an expensive one). Jupiter Distribution** has a holding in the company’s bond in their top ten – the managers can consider my purchases a payment on that IOU!
Since announcing our move, both friends and family have felt the need to tell me “you don’t have to buy it all in day”. But it turns out that, in an unfurnished rental, I do. Not just a sofa, bed and mattress, but also a kitchen table and – due to today’s WFH climate – a desk! And that’s all on top of the hefty deposit and additional moving costs I need to fund.
So, when given the option, I was more than happy to take up the 0% financing offers on the big stuff. Barclays, a top ten holding in TM CRUX UK Special Situations**, Schroder Global Recovery** and Merian UK Alpha**, was a popular choice for e-commerce brands. Being able to spread the cost of our bed, for example, over even just 6 months with no interest was a welcomed relief, not only us but our maxed-out credit card too.
*Source: TM home investor, May update
**Source: fund factsheet, 31 May 2020