If you regularly read the news, you’ll know that stories constantly pop up around lettings laws and landlord taxes. It’s enough to put you off investing in property. However, for those considering their options, property remains a solid choice.
With the private rental sector growing by the year, properties provided by landlords are in high demand. And, if you’re more of a figures person, you’ll know that the capital gains and rental yields provided by property rival even the most lucrative asset classes.
In this piece we’ll explain why property continues to offer one of the most significant returns of any investment.
High demand from tenants
Let’s start with the basics: there are millions of people in the UK that need a home to live in. Many of these people either have to or wish to live in private rental housing. The number of private tenants is also on the rise, which means that there is high demand for rental properties in many parts of the country.
With so many people seeking rental homes to live in, you’ll likely face few void periods and achieve a strong rental income every month.
Your options are endless
Continuing this thread, your options as an investor are endless when it comes to property, as there is a wide variety of tenants looking for homes. The standard model of buy-to-let does not apply any more; you can still invest in turn-of-the-century terraces or two-bedroom flats, but you also have family homes, retirement properties and short-term lets to consider.
Tenants are no longer just single students or young professionals, so you really can decide for yourself what type of property you want to base your portfolio around.
House price growth in hotspots
Although some house price statistics may be a little gloomy (especially when compared to several years ago), there are many pockets of the UK that continue to boast strong house price growth. If you can pinpoint these hotspots, you’ll be well on your way to making a solid long-term investment.
It’s the biggest cliché in property, but location really is key, so make sure to find up-and-coming areas to ensure high capital gains.
Rent prices on the up
At the same time, rent prices are continuing to rise, due to that all-important tenant demand that we spoke about earlier. If you invest in an area popular with renters that is due to experience strong house price growth, your returns will come easily.
Coupled with solid capital growth, a competitive rent price will deliver a secure monthly income that supplements your long-term investment plans.
Profits are still strong
As mentioned above, buying in the right location and setting the correct rent price can deliver healthy profits for landlords that rival all other asset classes. Nevertheless, you must be aware of the legal and financial changes that can dampen an investor’s income.
Providing you keep track of your finances, and understand all of the laws and taxes that you must comply with, it is certainly still possible to make a comfortable profit from property investment.
Whether you’re already a property investor or are new to the idea, it’s important to step back and think about how and why you’re looking to invest in this market. With some thorough research and a definitive plan, it’s clear that property can still be a solid investment option.
Written By: Just Landlords, an award-winning provider of Landlord Insurance: https://www.justlandlords.co.uk/landlord-insurance