The answer is simple, yes. Residential property is still the best investment?
It’s always a good time to invest in residential property. Especially because property consistently increases in value over the years. It’s a safe investment that you can benefit from your entire life. Still not convinced? We’ve listed a few more reasons to invest in real estate below:
Real estate vs stock market
The stock market is vulnerable to short-term fluctuations and there isn’t much room to leverage your investment. When you invest in a residential property you can invest just 10% of the asset’s value and own it with the help of a loan while at the stock market you’d have to pay the full price. Under the right circumstances, real estate is a great alternative to stocks, offering lower risk, yielding better returns, and providing greater diversification.
Regular cash flow
If you decide to rent out your residential property, you get to generate a good cash flow since money will keep flowing into your account on a monthly basis. It’s a great way to finance your retirement or have some extra money in the bank. Sure, it takes time and good management to find quality tenants but the investment can turn out to be very rewarding.
Increase your home value
While a residential property investment tends to increase in value naturally, you can also force the value up in short term by making renovations and repairments. Work with an appraiser or real estate agent to find out what your property lacks and decide on the most valuable renovations. Especially kitchen or bathroom renovations tend to increase your home’s worth drastically, so you can make money in the short term.
Be financially secure
The housing market has its highs and lows but usually bounces back if you hold onto your investment long enough. If you invest in residential property you are guaranteed to profit in the long run and it is considered a safe investment compared to the stock market. You can decide to rent out your property for a monthly income or sell it once you retire to make a profit. If you don’t decide to sell, you are still putting a roof above the head of many generations to come.
It’s easy
You don’t need to be an expert when it comes to investing in residential property. Anyone can invest in real estate in one form or another, even if you only have a small budget to start. After all, if renting it out doesn’t sound appealing to you, there are other ways of investing in residential property. You may consider fix and flip homes, becoming a wholesaler or investing in Real Estate Investment Trusts.
Expand your property portfolio
Investing in your first residential property could be the start of your property portfolio. By using an investment property’s equity, you can refinance the mortgage on it, take out the £50,000, and use it as a down payment on your next property. This way, you can earn even more regular returns while the value of the property increases.
Tax benefits
Since investing in residential properties and renting them out makes you a business owner, you get to enjoy many tax write-offs. This ranges from mortgage interests to maintenance expenses and more. You’ll lower your tax liability and increase your profits just by owning a property, though you should always consult with your tax advisors to verify if you can use these tax advantages.
If you have any further questions regarding whether you should invest in residential properties or not, contact our consultants today– they are ready to answer any questions.
Or, read more of our informative blogs here
