UK Property investment has long been viewed as a potentially lucrative investment, especially with so many investors opting to invest in bricks and mortar as an alternative to the more risky stocks and shares. Even with recent changes in tax regulations in the UK, there is still plenty of scope for investors to make good returns from investing in both residential and commercial buy to let properties. As a result, it is important that anyone planning to venture into this type of property investment is fully aware of all the associated pros and cons. The investment strategy involved will also have an impact on the possible returns. Buy to let investment properties can vary significantly in terms of location, size and quality of property, making them unsuitable for all but the most serious investor. However, there is a sector of the market which can offer both equity and capital gains, making it an attractive proposition for those who are willing to take on a bit of risk.
Residential property investment in the UK has traditionally focused on the higher yield potential offered by the more exclusive area’s which are typically located within the more affluent sectors of London, the South-east and the Cities. Over recent years there has been a shift towards the outskirts of the UK where investors have been able to find affordable deals which offer a greater degree of security. It is now common place for private owners to invest in homes and gardens in the suburbs of London and the surrounding areas. This is another reason why residential UK property investment types have been on the rise over recent years, as the demand for living options beyond central London has increased substantially.
Another sector which has benefited from recent property price increases is the Commercial sector. Many UK properties are leased out to commercial businesses which allows a greater degree of control over the future profits. This has helped to raise the value of UK property prices across the board and attracted a number of foreign investors to the UK property market. One of the main factors behind this is the relatively low rate of unemployment which has meant that more people are able to make the transition from full-time employment to become self-employed or run their own business. The lower rate of unemployment combined with an increase in disposable income has also encouraged foreign investors to take advantage of the UK property market. The fall in the exchange rate against major currencies has also made UK property prices more affordable for international investors.
One of the most popular UK property investment types is the buy-to-let investment. Buy-to-lets allow home owners to either rent out their property themselves or allow tenants to live in them. In many cases they will act as a small form of investment for both the home owner and tenants. However there are some buy-to-let investors who will use the property as a regular source of income. Some people choose to rent out their houses and apartments as an investment property and earn rental income on their tenants. Others will sell their homes and apartments for a profit and choose to rent out the property as their main source of income.
There are several different methods that you can use to earn money from your buy-to-let investment properties. The rent that you pay each month should be enough to cover your mortgage payments plus any other outgoings such as insurance. Another method of earning money from your buy-to-let property investments is to allow tenants to use communal areas and facilities. You can choose to do this through the utilization of appliances and amenities or leasing these out from time to time.
There are many UK property investment pros and cons that potential investors need to consider before investing. One of the key issues that any investor must take into consideration is how much risk they are willing to take. Most investors will find that it is easier to invest in residential properties as compared to commercial ones. Residential properties will provide the investor with a fixed return and security. However, this can also come at a higher cost as most mortgages will be higher as compared to commercial ones. Another factor that must be considered by any investor is that the returns should be more than enough to cover any initial investment costs.
It is always important for investors to conduct proper research in order to determine which type of investment will suit them best. When looking to invest in UK property, it is wise to follow the advice of experienced investors who can help you find the right investment opportunities. Many foreigners are flocking to the UK due to its favorable investment climate. In fact, Foreign Direct Investing (FDI) has made a considerable contribution towards the increasing house prices in the UK. Foreign investors are buying up houses as their main investment options and are succeeding in driving down house prices across the UK.
However, many investors are worried about the future of UK house prices as they have seen many overseas investors move onto the country’s property market after seeing house prices drop in the US and other European countries. However, experts believe that the fall in house prices in the UK is temporary as there are many factors that are influencing the market. One such factor is the arrival of many foreign investors into the country, especially from Asia, who are looking to take advantage of the current investment climate in UK. Another reason for the fall in house prices is the increase in demand for housing by UK citizens who have taken action and bought a home. Overall, experts believe that the UK property market will only see positive developments in future.