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Antony Antoniou – Luxury Property Expert

UK Buy to Let Market

There are many different strategies out there to increase your cashflow and portfolio. However the first decision you would have to consider is the angle i.e. strategy you will embark on within property. For instance you may want to purchase a property that requires renovation with the objective of renovating and either letting it out or reselling it for a profit. This would require ensuring that you are aware of the market value and then purchasing at significantly below market value to ensure you have enough for the costs of the renovation and your profit margin. However one of the first pointers that property investors are provided with initially is to consider buy to let.

Buy to let property is where you purchase a property but you have the intention of renting the property out. This is a great option as depending on the value of the property you will not need a considerable deposit and also it would not require much management as there will just be a single tenant or family living at the property. Therefore from a managerial perspective it would not be too demanding. If you are currently considering how to invest in property do not ignore this option. Although this is not the best option for achieving a high level of cash flow you can slowly build your portfolio on this. You have to also take into account that a benefit of such a strategy is that there is also not a high level of management required in comparison to running a HMO. So if you are starting out or are currently in the process of building your portfolio never ignore this particular strategy.

During recent times there have been tax implications and other regulations that have made it more difficult to purchase property in the UK. However if you have the right structure and system in place you are able to still utilise property as a good income stream. As the demand for UK property particularly rental is still high despite Brexit, the need for high quality rental accommodation is ensuring a steady stream of tenants. The rental returns particularly if you have utilised finance for your purchase is not as high as what you would achieve if it was a HMO but you also need to take into account the potential capital appreciation return you will achieve. Therefore if you are looking for just cashflow you can purchase cheaper properties in areas where there is unlikely to be much capital appreciation that achieve a high yield of 15+%. However if you are looking to achieve capital appreciation as well as cash flow you need to ensure you purchase a property in the right location. This is where you see from your market research that in the next 5-10 years prices are likely to appreciate in that particular area.

Remember the number of people in the UK living in rental accommodation is higher than ever, with major increases in the last few years. Therefore utilise this to your advantage and do not overlook this simple strategy of buy to let with all the other great strategies as well. Ensure you diversify in order to minimise your risk.

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