With typically more stable growth than some of the more volatile asset class options out there for investors, property investment is a popular option for those wanting to invest in something long-term. If you’re interested in learning more about the property investment market, here are three key steps that you might want to consider in 2021.
Ensuring that you have the capital
As with any investment strategy – you need to understand that your capital will be tied up into the asset. Consider your existing financial situation, the commitments you have, and how much you can feasibly afford to put into an investment. Remember that when researching investment methods you should also factor in your own personal financial situation, as everyone is different.
With property investment specifically, being a typically long-term investment, you need to be aware of the fact that your money is going to be tied up in a physical asset for the foreseeable future, with hopes of steady growth and return on investment down the line. Of course, if you want to make a consistent return from your investment in the form of a secondary income stream, you might decide to invest in property for buy to let purposes, as this will allow you to make consistent returns when your rental property is tenanted.
Considering the best factors
There are a multitude of different contributing factors that will overall affect the value and success of your property investment going forward. Here are some of the key components that you’re going to want to keep in mind:
- Area growth – Investing in an area that has sustained growth and trends towards the positive in the years to come will ensure that the price of your property rises, too. Look to cities that have a varying amount of regeneration projects ongoing, and that have sustainable demand.
- Rental yields – Again, if you’re investing in property for buy to let purposes and want to make a secondary income, rental yield averages are extremely important. Look at the types of property and the areas that have the highest average rent percentages.
- Tenant demand – Think about the tenant market with regards to your property, and make sure that there is demand there. Otherwise, you might end up with void periods if investing in a buy to let property. Element Developments are a good example of a company offering specific features and facilities to entice tenants, including eco-friendly heating, lighting and more.
Making the most of online tools
Over the past twelve months as investors and property companies have had to adapt to new living circumstances and remote work (due to the pandemic), many online investment tools and services have risen to the surface, allowing investors to continue to get in on the best opportunities and markets from the safety and comfort of their own home.
If you want to start investing in property but feel unable to investigate specific areas due to area restrictions in place, take a look at some of the different digital tools and technologies available to you that you might be able to take advantage of. RWinvest, for instance, an award-winning property investment company based in Liverpool, have been offering both virtual meetups and tours to clients with information on the specific property and area, along with virtual reality tours that allow clients to get a first-person perspective on a property from the comfort of their own home.