Investing in UK property is regarded as one of the safest forms of investment. Typically, property values tend to stay the same or rise, which means buyers are unlikely to lose money through loss of capital; plus the rental yield adds a welcome monthly income.
However, as with every form of investment, there are some risks involved. The good news is, if you understand the risks and know how to manage them successfully, you should enjoy good success from investing in property in the UK.
Here’s a quick guide to show you how.
- Changes in location. Buy in the right area, and you should enjoy strong capital growth. Buy in a location that’s stagnating or becoming less popular, and the reverse could be true. The best way to manage this risk is to familiarise yourself thoroughly with the area; assessing how properties perform in the neighbourhood, and checking whether there are any important changes due to take place in the future – e.g. new transport links or regeneration plans.
- Problems with the property. Nothing eats into your profit margins as badly as issues with the property. Whether it’s replacing a dodgy boiler or making structural repairs, it all costs money – and this can spiral out of control if you’re not careful. Before buying the house or apartment, make sure you view it, plus get the necessary surveys carried out. This will minimise the chances of you being hit with any unpleasant surprises.
- Troublesome tenants. Difficult tenants are not only a headache to deal with, but can adversely impact your profit margins too. For example, if you get a tenant who damages the property but refuses to pay for it, this can leave you out of pocket. Likewise, if you have to go through the eviction process, this can be costly (not to mention stressful). The solution? Vet tenants carefully before any contracts are signed. A good property management agent can help with this.
- Wrong price. If you purchase a property at the wrong price, you might find yourself waiting a long time to generate any capital growth from it. A good property investor always looks for houses and apartments that are competitively priced, in order to maximise ROI. Buying a house at auction is a great way to find a bargain property, or alternatively, talk to a property investment agent, who will have houses on their books that aren’t available on the general market.
The Buy2Let Shop Limited
UK property investment is one of the most effective ways to generate profit – with plenty of opportunity to make money from rental yield and capital growth. However, it’s important to approach the investment process wisely, to ensure maximum ROI. A good property investment agent will help you find the right buy-to-let property for sale, then offer advice throughout the purchasing process.
The Buy2Let Shop team are professional property investment agents in London, with years of experience in the industry. If you’d like to learn more, simply visit The Buy2Let Shop website today.