There are a number of reasons why property investment is such a popular strategy, and many people set owning a rental property in the future as one of their main goals. If you have been considering property investment, answer these questions and see whether you are ready to delve into the profitable world of property investment.
Have you got enough in savings?
There are a number of different ways you can start out in property investment, and you definitely don’t have to be a millionaire before buying your first buy to let property. However, it is important to make sure that you have enough in savings to cover you in case of any financial issues in the future. It is crucial that you have a good grip of your finances and are definitely able to afford to invest in property.
Moreover have a look at your previous financials, set yourself a realistic budget and make sure there is extra cash you can access if you need to. If you choose to take out a buy-to-let mortgage it is essential that you can make the monthly payments and that the rental income will cover these. You will also need some extra money available, so you pay any fees or extra costs that are involved in your investment.
Have you done your research?
One of the most important things when it comes to property investment is doing your research and understanding the market. The UK property market often experiences significant changes, and it is important that you make the best investment available to you. Certain areas of the UK are experiencing far higher growth than others.
As in November 2018, house prices had risen by an average of 3.3% in the UK Cities House Price Index. However, in Manchester, prices rose by 6.6%, Birmingham has seen price rises of 6.3%, and Liverpool saw a rise of 5.3% over the last 12 months. Compare this with London prices which fell by 0.1% and Cambridge property prices which fell by 1.1% and you will see how much difference location makes to the profitability of an investment.
Have you considered all of your options?
Other factors like considering off-plan developments, looking into student accommodation and finding a property with the best rental yields are vital parts of your research. Therefore property investment specialists RW Invest have a wide range of property investment opportunities, perfect for first time investors who are looking for rental yields and growth potential.
Do you need access to your money?
Property investment provides both the opportunity to gain rental income and to sell the property on for a profit in the future, so if you have a set amount of money available to you, it is a great way to make your money grow and beat inflation. However, investing in property means that your money is tied up in the property, and for really significant capital appreciation, it is worth keeping the property for a number of years.
Are you willing to wait?
The best returns on property investment come from taking a long-term approach. Buying a cheap property and flipping it for a massive profit isn’t as viable now, because the property market will see slower growth rates and fewer properties on the market. If you need quick access to your money, property investment probably isn’t for you as you will need to sell the property, pay fees and it can be a long process.