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Why invest in Property? – Property Investment

Posted by Jehan Anis on September 12, 2022
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Introduction to property investment-why invest header

There has never been a higher demand for housing. Between 2019 and 2020, the population increased by approximately 500,000, reaching about 67.22 million. If this trend continues, the population will surpass 70 million by 2026, and they will all need a place to live.

 

It is also likely that the number of single-person households will increase by 159,000 per year, causing the United Kingdom to become the most densely populated nation in the EU3.

 

UK Housing Demand is Increasing

 

The government reported that at least 232,000 new homes must be built annually in England to meet demand. 

 

Property investment is commonly viewed as safer than other asset classes (such as stocks and shares) due to the constant demand for housing. Even though the economy can and does affect housing prices, it remains the safest asset class for medium- and long-term investments.

 

Why Invest in Property?

 

There are numerous ways to invest, including converting your current residential mortgage into a buy-to-let mortgage and investing in a property fund. In this blog, we will discuss seven reasons why investing in property is a good idea.

 

1 20% of The UK Population Will BBooking to Rent Property By 2023

 

Increasing numbers of people are being forced out of the housing market, increasing demand for rental property. This demand has nearly doubled since 2002, and rental properties comprise 11 percent of the housing stock. In addition, population growth is at record levels, making buy-to-let the ideal investment opportunity.

 

2 Bricks and Mortar Always Has Been Safe as Houses’

 

As with all clichés, “safe as houses” contains an element of truth; property investment will always be a stable asset class, especially for long-term investors. Despite an unstable political climate in the United Kingdom, a world economy that is frequently shaken by global events, and an uncertain foreign policy, property investment remains the safest investment option.

 

3 It is Easy to Get Started

 

In contrast to other asset classes, you do not necessarily need specific knowledge to begin a career in property investment. Often, an increase in the value of your property is all that is required to encourage you to investigate this method of making money further.

 

An entire industry is devoted to offering assistance, advice, brokers, and consultants to help private investors maximise their wealth.

 

4 Real Estate is Simpler to Comprehend Than Stocks and Shares

 

Indeed, if you have the time and inclination, you can learn sufficient information about investing in stocks, shares, and bonds. But there is no doubt that understanding the complexity of the trading world is complex and requires a great deal of time, effort, and commitment. On the other hand, investing in property is easier to comprehend with some online research and sound advice.

 

5 It is Relatively Easy to Obtain Financing

 

In general, lenders prefer to lend for real estate investments, be it a mortgage or another type of investment. All banks offer mortgages as a central component of their business models, and they are always more likely to lend on residential property than on other assets. Generally, they will lend a much more significant proportion of the property’s value and at much lower interest rates than other asset classes, including commercial real estate.

 

6 Leverage Can BUseful

 

Using real estate instead of a stock portfolio as security allows you to take out loans. Lenders will typically let you borrow up to 95 percent of a property’s value but only 60 percent or so of a stock’s value. If you can borrow more money, you can profit from the asset’s capital appreciation. One of the most compelling reasons to invest in property instead of stocks and shares is greater leverage.

 

7 Property Investment is Your Adaptable Ally

 

There are numerous investment strategies available, so you should be able to find one that fits your objectives. For example, depending on whether you’re seeking a cash infusion in the near future or a retirement fund, you may consider long-term capital growth, profitability, or value creation.

 

 

Conclusion

 

Conduct extensive research before investing in property! You can find a wealth of helpful information online, and numerous advisors are available to assist you. Ensure you gather as much information as possible and consider which type of investment best fits your needs and objectives.

 

It’s an excellent time to get in on the action. Happy Investing!

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