Property Investment Guides: UK
Find the Best Property Investment Locations in the UK:
With house prices and rents expected to increase over the course of the next five years and beyond, 2023 is the perfect year to expand your property portfolio. With this in mind, we have taken a look at some of the UK’s leading buy-to-let locations to help you decide where your next investment will be.
Below you will find all of the property investment advice you need and information you need for locations such as Manchester, Liverpool and Sheffield. If there is somewhere specific we haven’t talked about please do not hesitate to get in touch, our team of specialist Property Consultants will be happy to help.
- 14%
House prices are forecast to increase by 14.0% in the next 5 years (JLL, 2023)
- 22.8%
Rents are forecast to increase by 22.8% in the next 4 years (JLL, 2023)
What is an Investment Property?
Put simply, an investment property is a property either purchased at a low price with the intention of being renovated and sold or the purchase of a property with the intention of renting it out to the Private Rented Sector (PRS) instead of living there as an owner-occupier.
Why Invest in UK Properties?
Property has always been one of the most popular asset classes to invest in as it is a tangible product that the investor can have full control over. Property is also most likely to experience steady growth in value over time. Additionally, there is a huge demand for rental accommodation in the UK and more people are renting for longer periods of their lives, making UK property investment an incredibly lucrative investment option.
Benefits of Property Investment
Investing in property is an excellent way to diversify your income whilst also protecting your wealth. The UK market in particular has seen exponential growth in recent times and continues to remain a strong place to invest.
A Guide to the Best Property Investment Locations in the UK
There are so many factors to consider when it comes to investing in UK property, one of the main ones being where you want to invest. With this in mind, we’ve put together a selection of property investment guides to look at the best buy-to-let areas in the UK.
Best Areas for Property Investment in the UK
Manchester Property Investment Guide
Sheffield Property Investment Guide
Liverpool Property Investment Guide
How much can you make from property investment?
How long is a piece of string? On the face of things, how much you make from property investment depends largely on how much rent you’ll charge, however, there are so many other factors that come together to make the potential earnings almost infinite. Whilst you predominantly earn through rental income, you can also make money through capital appreciation when re-selling your property. This sale and/or saving up rental income can allow investors to diversify and expand their portfolio to create an extremely varied, income-generating property portfolio. So really, the possibilities are endless.
How much do you need to get started in property investment?
The price of getting started in property investment varies depending on your own personal investment strategy as well as the location in which you invest. For example, student properties are, on average, much cheaper than residential properties and make for a good entry point. Whilst residential properties are more expensive, there are opportunities for lower costs in cheaper markets or even by buying off-plan. The best thing to do would be to get in touch with a property consultant and talk through your current financial status and goals for investing in property.
Property Investment Types
Choosing an investment type is dependent on each individual investor as they all come with their positives. New-build city centre apartments tend to receive higher rental incomes when compared to suburban properties, however, the latter can often increase in price at a quicker rate. Student property, on the other hand, offers much higher rental yields, however, there is not usually a markup on these types of properties. In the end, it really comes down to an investor’s individual goals. Take a look at our comparison of the two here.
Risks of Property Investment
Like all investment ventures, property investment has a few risks that you will need to consider before you invest. First and foremost, the housing market is not protected against external negative factors – for example, if there was a financial crash, this would have a huge impact on the property market and the value of your property may fall. You will also need to rely on high demand from tenants to receive a steady income.
What to Look for in an Investment Property
Your personal investment strategy will determine what you need to look for in an investment property, so before deciding, you need to do some thorough research. You will need to research; what areas you would need to invest in to get the best returns, what kind of tenants you would want and how you would manage your properties – whether you manage them yourself or you enlist a management company. Once you have decided on all of these factors, you must then look for an investment property that meets these needs.
Property Investment FAQs
What are the costs associated with property investment?
There is no definitive answer to this question as there are several factors that you will need to consider such as whether you want to manage your property yourself, whether you will have mortgage repayments and whether you’re buying a freehold or leasehold. However, there are some fixed costs that you can definitely expect – these include Stamp Duty for residential properties and solicitor’s fees. It is also advisable to put aside contingency money for maintenance on your property and void periods.
What is a NET yield and how do I calculate it?
Yields are the return on investment per year expressed as a percentage. A NET yield is the value when all the associated costs have been deducted. As an example, a property could be achieving annual rents of £10,000 (gross rental returns) but when ancillary costs are deducted like ground rent and service charges, the actual rent is more likely to be around £8,000 (NET rental returns).
What does it mean by ‘assured NET yields’?
Assured NET yields are a rental assurance that developers offer landlords for a specified fixed period. This means that rental income will be assured on the property for the specified period. A number of our current investment opportunities are offering NET yields at the moment. Take a look through them all here.