The demand for housing is on the rise as never before due to the increasing population. If the population keeps proliferating at such a pace, then by 2026, it might rise beyond the mark of 70 million, as reported by the Office for National Statistics.
Apparently, people need some place to take shelter, perhaps a place they can call their home. As the demand for housing will increase subsequently, we can predict a bright future for property investment in the UK in the forthcoming years.
Brookings confirms that “renting is the most common tenure among people with the lowest incomes and this constitutes around 59.2% of the population”. So, if we look at the statistics, the time is perfect to buy a rental property in the UK.
What are the different types of private real estate investments?
You can search for investment property for sale in the UK, including buy-to-let investments, property developments, and abroad investments.
Buy-to-let property investments
As the name suggests, people purchase buy-to-let property with an intent to let it out after purchasing whilst generating regular rental income and revenue covers. Landlords expect to make rental yields and capital growth, while someone else pays off the debt. So, if you are eyeing to acquire an investment property in Birmingham, London, Manchester or any other city, then buy-to-let properties are the best resort.
Bear in mind that it’s the Landlord who is responsible for the maintenance of the structure unless the tenant has caused damage via negligence, so you’ll have to shell out extra pounds as every property requires upkeep, irrespective of it being for rental purposes or living purposes.
Commercial property investments
There are various types of commercial property opportunities, including tenanted offices, industrial warehouses, retail space, etc. As an investor, once could either buy the building/space, or if you don’t have appetite for the extra responsibility and you’re happy making a lower return, with less risk, then you could invest in funds managed by shareholders, providing different benefits than residential properties.
The other options for commercial property investments include direct investment, direct commercial property fund, property stocks and shares and indirect property funds.
Buying off-plan and buying off-market
Buying off-plan refers to buying properties before the completion of their development whereas buying off-market carters to the private sales that are not advertised online or in marketing assets. The benefit to buying off-plan, would be that you should essentially be buying at today’s price and only complete and start paying in 1 to 2 years’ time, when the development is completed. The objective here, to make that speculative margin, being the capital appreciation accruing during the build time.
Apart from the seemingly bright future that such investments predict, the benefits of investing in real estate private equity seem quite alluring.
Buying at an auction
Theoretically, one should be able to acquire below value properties at an auction, but there’s associated risks involved. You don’t get the same time allowances to conduct research and check your numbers and secure your finance, so you must be certain and know what you’re doing, or very expensive mistakes can be made.
Buying up parcels of carefully selected land is also a great opportunity, but you need to conduct your research. Ideally you want to buy land where there’s regeneration about to occur, or where the land is key to some specific business/industry in the area or possibly moving to the area.
Land investment can require more capital input, as it might not be abler to generate any income prior to having structures built on it, which will also require capital input for planning and developments and takes a little longer to generate cashflow.
The fringe benefits of private property investment in the UK
- The fringe benefits of private property investment in the UK
- The initial process of investing in real estate is simple and convenient.
- It is one of the easiest to comprehend classes of investment assets.
- You can leverage your property to borrow up to 95% of the property value from lenders.
- The control remains in your hands after the property is in your ownership.
Weren’t the above pointers enough to lure you towards considering real estate investment as a worthy option, provided the soaring percentage of individuals who choose real estate investing in the UK?
How to check if the buy-to-let property is right for you?
However, buy-to-let properties are the new trend; they’re not like buying residential properties and come with a lot of responsibilities attached to them. Considering investment property in London, Manchester, or anywhere across the UK is a good idea if you’re looking for something tangible.
So, are you ready to be a landlord? You can check out our website, Capex Properties and get some ideas of investment property for sale, London, Manchester and all across the UK. Before buying such properties, always keep in mind that mortgages are different for buy-to-let and are not as convenient to acquire due to the potential risks involved with renting the property out to tenants.
But, don’t let this deter you because we all know that property is one of the most promising investments as the value keeps on increasing in the long term. Proper maintenance and management of a buy-to-let property will definitely foster higher returns.