Property Investment Strategies
Are you interested in investing in property? Here are three strategies you should consider pursuing:
There are two key ways to make money as an investor in property - capital growth and rental yields. Looking at ways to earn on both provides you with the fantastic opportunity to make money in the short and long term.
The Best Investment Strategy For You
Property has always remained the most reliable investment to deliver strong returns, and there are many avenues to go down when it comes to making money from property:
Buy-To-Let
The leading type of property investment is buy-to-let. This is where an individual will buy a residential or commercial property with the purpose of letting it out to a tenant, who will pay rent to occupy the property for long periods. The rental period will typically be a year or more. A buy-to-let investment is considered a relatively safe investment as by looking at the recent rental market and trends it is fairly easy to predict the rental income you can achieve, as well as calculating the return investment this will provide.
We are seeing a consistent rise in the number of renters in the UK, as a result the demand for rental properties looks to increase too. However, it is important to note this does not mean you are guaranteed to find a tenant for your property, this is unfortunately one of the risks of a buy-to-let investment. When considering the investment into this market it is important to think about the location of the property and make sure the property will appeal to your target tenant. Check out our blog on: Buy to Let Investments, where we go into this in further detail.
Holiday Let
Another type of property investment to consider is holiday let. This is the process of buying a residential property and letting it out for shorter periods of time, typically between one night to one month, to a number of different tenants.
We have seen this type of investment become more popular, partly in response to the COVID-19 pandemic. Holiday makers turned to holidaying within the UK in times when international travel was restricted. The domestic tourism market spiked and still remains popular with those who have found a love for a new way of holidaying.
Holiday let properties have the potential to achieve a higher rental yield than a traditional buy-to-let. If your holiday let is in the right location, with a good turnover of tenants you are able to charge more per night. However, it requires a lot more work to ensure the property continues to stay occupied and you may experience periods where it remains empty outside of the peak holiday season.
Buy-To-Rent
A third type of investment is build-to-rent, where-by an investor will buy land to build a property/ properties with the intention of them being let to tenants. For investors who keep informed in the latest rental market trends this investment makes an excellent choice. Using this market information increases the opportunities to capitalise on. For example, since the start of the pandemic we saw a shift in the features of a property renters are interested in. Properties with gym amenities and shared office spaces can attract premium prices. Build-to-rent investors can construct their properties with these trends in mind to build properties with the most rental appeal. Further to this, properties that create a sense of community through shared spaces tend to encourage longer rental periods, which in turn delivers an increased return on investment for you, the property developer.
Discuss Your Mortgage Options
The type of property investment that suits you best will depend on a number of factors, including your budget, experience, strengths and skills.
Property investment provides a great opportunity to create a reliable income and to provide financial security - it offers a range of benefits, being both rewarding and profitable. However, it is important to find the right property and to secure the correct mortgage that suits your personal circumstances.
The professional team at Transparent Mortgage Services are highly experienced in this area, working with first-time property investors to experienced investors. We are here to discuss your mortgage options - please contact us today on 01424 444 597 or email us at info@tms-fs.co.uk
