Should I still be looking at Investment Property?

Should I still be looking at Investment Property?

15 reasons keep your investment property plans

Nearly every industry in the world has taken a hit due to the economic shake up caused by COVID-19. As a result many countries have been attempting to precariously balance health and economic interests, and as the problem blazes on, many are changing their financial priorities. But what does this mean for the property market? Simply put, is it safe to buy an investment property right now?

There have already been signs that the COVID-19 situation has led to an even higher confidence in property investing. In fact, property is a much safer investment than you might think during this crisis. Here’s why:

1 Stable – Much more stable than other forms of investment

2 Physical tangible asset – even if the overall value depreciates, you’ll still be left with a physical asset

3 Low Savings Rates – Central banks continue to announce they will be lowering interest rates and interests on savings accounts.

4 Invest directly online – the rise of the digital age has meant investment property can be sourced online directly. As well as virtual viewings making it virtually easy!

5 ‘Boris Bounce’– After Boris Johnson was elected as PM in December 2019, the UK saw what experts had coined the ‘Boris Bounce’. Due to a boost in market certainty, the UK property market experienced a lot of growth. By January, for instance, average house prices in the UK had leaped by 2.3% since 12th December.

6 UK market’s resilience – During the 2009 swine flu outbreak, house prices in the UK continued to rise by 10.1% from March 2009 to March

7 Lockdown life – Renters priorities have changed. A boost in demand for apartments and investment properties with balconies or shared gardens/terrace areas, and high-speed internet to facilitate remote working, as many renters were looking for accommodation that was better suited to ‘lockdown life’. 

8 Discounts – Developers began offering enticing deals for investment property soon after the beginning of the pandemic.

9 Repayment holiday – UK banks are offering those with a residential or buy to let mortgage the chance to take a ‘repayment holiday’ for up to three months. 

10 Volatility of other Assets Yields on other assets have massively dropped.

11 Scarcity of financial products Banks offering fewer high-loan-to-income mortgages. The best opportunity to take advantage of these products is now.

12 Household income preservation – Governments have been striving to preserve household incomes. Handouts through wage subsidies, furlough schemes and expanded welfare benefits amount to 5% of gdp

13 Disposable incomes Households’ disposable incomes in the g7 group of large economies were about $100bn higher than they were before the pandemic, even as jobs disappeared by the millions, this figure stayed high.

14 Economic rescue plans Governments are slowly winding down their economic-rescue plans – the time to act is NOW!

15 Flexibility The resilience of the UK property market has shone through 3 national lockdowns.

 

Conclusion

Despite uncertainty, the UK property market has exceeded expectations, and has been thriving throughout the pandemic. Even though the overall market has slowed down, property is the only investment which has seen minimum down trend, and has held its forte. Compared to the other investment options, property still remains the safest and the most reliable asset.

The pandemic has certainly made many people think about how and where they work and live. The gloomy locked-down days have had tenants mulling over their prospects. The boost in demand for apartments and investment properties with a sense of opulence and grandeur, has given many savvy investors constant rental demand. Glossy buildings, with balconies or shared gardens/terrace areas coupled with high-speed internet to facilitate remote working, have become a priority for tenants. Purpose-built, off plan investment property provides an excellent opportunity to take advantage of this lucrative market, and owning one of these is going to prove to be a flourishing asset, in both the current economic climate and the future.

To talk to us about your investment property plans, Contact us.

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