Read the original article published by International Living here.

In the 1990s and the first half of this decade there was a roaring party going on in the UK’s cities and large towns. It was called “buy to let”. This basically means rentals. The term was misleading. For the last few years of the boom (at least), letting didn’t come into it.

Here’s how it worked. Brownfield sites are development lots in prime urban areas that have historically had some kind of industrial use. Docklands or linen mills, for example, in Northern England. A developer would get planning permission (permits) to build shiny new condos on a brownfield site.

Once the party had started, credit was flowing freely. All the developer had to do to get the cash to build was to show his pre-sales to a bank. Banks would compete for the business once the pre-sales were in place. They wouldn’t do any due diligence on the buyer’s capacity to complete the contract. They didn’t care. Their boss from head office had told them they need to lend twice as much this year as the previous year.

The developer would pitch these condos to investors. Investors could get in with as little as 5% down and nothing due until completion. On completion, 80%-85% (or more in many cases) finance would be available. Thing is: Investors could get 80%-85% of the “value” of the condo. Annual prices were rising well into double digits. On completion investors could flip or just get a mortgage for more than they paid for their unit and pocket the difference. Low transaction costs in the UK helped facilitate this type of speculating.

The party was so good it attracted more and more revelers. More off-plan projects and more salesman ploys to ensure greed overruled good sense. Then, in the middle of this decade something happened. Supply outpaced demand, UK interest rates rose and banks tightened their lending policies. The UK is a diverse market so this happened at different times in different parts of the UK. The party was over before the current financial and economic crisis hit. The crisis made sure that the last few stragglers were shown the door.

Developers have been left with unsold units and banks looking to recoup what they can. There are deals to be done. There is an extremely active rental market in many of the UK’s cities and towns. Today, we can go back to playing the “buy to let” game. Our friends from the party have a hangover and won’t be showing their faces for some time. You need to be careful however and always follow my three golden rules of crisis investing:

1. Buy quality (location, construction, amenities and fit-out)

2. Don’t take on any construction risk…buy completed units

3. Don’t take on any project risk…make sure the condominium is functioning

This is why I like deals like “Project X,” a deal I shared recently with members of Real Estate Trend Alert. The building is located in a prime location in the UK’s second city…the units are complete…the construction is high-end…and the condo is functioning. We don’t need to speculate about how good the construction quality will be—it’s there, it’s real.

The rental market and yields in this area today are strong. Buying at a 52% discount gets you gross yields pushing double digits with the strong prospect of capital appreciation. Your neighbor will most likely have paid twice what you pay. He bought pre-construction three years ago. With only 11 units still available there isn’t a risk that the building will lie empty or become run down. Prices start at £65,000 ($107,000).

If this is something that interests you, join Real Estate Trend Alert now and get all the details.