If you’re considering making any type of investment, it’s always key to do your research beforehand. There’s a number of things you need consider before investing in property to ensure your venture is as lucrative and effective as possible.
Location is key when it comes to property investment. Before making an investment, make sure you properly research the property market and find the best areas. In the United Kingdom, there’s been a recent shift away from London and towards the north, with cities in the north-west becoming top property hotspots. Liverpool and Manchester provide some of the best property investment opportunities, with high rental yields, strong levels of demand, positive capital growth and a growing population.
More people have recently started leaving the capital to move up north, with a record-breaking influx of London leavers moving to Manchester in 2017. Manchester and Liverpool, along with being highly affordable cities, have plenty to offer in terms of business opportunities, culture, and quality of life. Property investment companies like RW Invest offer apartments based in the north-west, with high yields and stylish, modern designs.
Investing in the north-west region is also one of the best moves if you want a big return on investment in terms of capital growth. This region has the highest predictions for house price growth in the UK, with 18.1 percent growth predictions by 2022. Regeneration projects in these areas are set to give the region a boost throughout the coming years, with projects such as Liverpool Waters which will bring a new city center neighborhood and multiple new jobs to the city.
Once you’ve chosen an area to invest in, you need to think about the type of tenant you want to rent your property out to. If you’re investing in the city centre, it’s likely that your property will appeal more to young professionals or students who want to rent a place that’s close to their work or university campus. Alternatively, if you want to appeal to families or older couples, a more suburban area might be best.
For buy to let investment, students are often the most desirable tenants. Student property is always in demand, particularly in popular university cities like Manchester, Liverpool or Leeds. The purpose-built student accommodation market has grown from £4.5 billion in 2016 to £5.3 billion by 2017, with more luxury and high-end apartments rising in popularity. Buy to let investors who choose high-quality student accommodation in prime UK areas should expect some of the highest rental yields and most regular demand compared to other investments. Similarly, with young professional tenants creating a steady demand for rental properties, city-centre apartments are another key investment option.
Really try and get into the mindset of your potential tenants before putting your property on the market. Certain tenants are drawn to properties with particular features, such as high-speed internet or an onsite gym, so do your research and decide whether there’s anything you could do to attract more interest in your property.
Last but not least, one other key thing to think about before investing is the financial side of the investment and the costs involved. If you don’t think you have the right amount of funds to pay for an investment up front, consider whether you’ll need to take out a buy to let mortgage to help you.
Buy to let mortgages can be effective in helping you pay for an investment, but there are some limitations. Some property investment companies only allow you to make upfront payments without a buy to let mortgage, so it’s worth thinking about whether you need a few years to save before making the right investment for you.