While we are living in a digital era which allows us to invest in more ways than ever before, the purchase of property remains one of the most popular, and stable choices when it comes to investment across the globe.
However, for those who are considering options, we explore why property may make the best investment for your money.
Property as an alternative to other investments
For many investors, the allure of investing in property is that acquisition of a “real” bricks and mortar asset. Investing in property gives an opportunity to generate immediate cash flow via rental income while also offering long term growth through capital appreciation.
In comparison with choosing stocks and shares as an investment vehicle, property offers easily accessible and digestible historic information, such as property trends and market growth, making it easier for investors to judge when, and where to enter the market.
Learn more about property vs other investments.
Investing in property for retirement
Research undertaken by the ONS in its Wealth and Assets Survey shows that investing in property is still seen as one of the most stable ways in which to build a nest egg for retirement, particularly among the self-employed, where 42% of respondents saw property investment as the safest way to save for retirement.
The best type of property in which to invest depends on your circumstances and depending on how far into retirement you are, what you hope to gain from your investment.
For many of those planning for retirement, it’s often the case that property investment may be seen as an alternative to pensions.
A big benefit to investing in property is the potential for diversification. Real estate has a low and in some cases negative, correlation with other major asset classes. This means the addition of real estate to a portfolio of diversified assets can lower portfolio volatility and provide a higher return per unit of risk.
And there is a wealth of opportunity to diversify your property portfolio, be it by investing in different locations, countries, or by acquiring a mix of property types.
One of the key advantages of property over other investments is the opportunity to leverage the asset. Banks lend against property at the level that they do because it is seen as having a fundamental “bricks and mortar” asset value, with historic records of growth.
No other asset class offers the same opportunity for borrowing against the “stock” as property does, giving those investing a wealth of options when it comes to re-investing in further income-producing assets.
Many individuals choose to invest in real estate to be able to leave a tangible and easily shared asset for their children. An obvious benefit is that those who inherit property have a range of choices when it comes to how to continue – they can sell the home, let the property to generate a revenue stream or even choose to live in it.
Whatever your reasons for investing in property, Benoit Properties are on hand to assist you. We can offer an end to end service, including property sourcing, buying advice, lettings and management. Our experts are consistently researching the market to find the best value deals that will suit your investment strategy.