In spite of the unsettled political and financial period of late, investing in property is still seen as a relatively ‘safe bet’ with scores of professionals choosing to invest in bricks and mortar over alternative investment opportunities.
However, as anyone with investment know-how will tell you, the key to success is to avoid putting all your eggs in one basket. In other words – diversify!
And when it comes to property, there are multiple ways to spread your risk and improve your return on investment (ROI) year on year. Diversification within your portfolio is crucial as there can be such fluctuation in how each of your assets behaves, and they tend to head in different directions at different times.
2018 will see the rise of several relatively new and exciting property investment opportunities. Gone are the days of limiting your portfolio to buy-to-lets; a truly diverse portfolio will consist of a range of property strategies. Here is our guide to some of the investment types we predict to be BIG in 2018:
House in Multiple Occupation (HMOs)
For the uninitiated, a HMO is an entire house or flat which is let to three or more qualifying people who are not all members of the same household (e.g. a family unit).
Many people think HMOs have lots of pitfalls - this is often to do with the bad press they receive. However managed properly, they can be a serious property investor’s best friend. Here are just some of the benefits:
It’s a massive growth market - We’re smack bang in the midst of a housing crisis and the Government is actively promoting communal living as a way of creating affordable places to live. Demand is high for people with a quality property to let.
Fantastic ROI - You’ll make significantly more money out of a quality HMO than you ever could for a single let. Fact!
Less risk from voids and non-payment - More tenants actually means the risk of non-payment or void periods is reduced, however be mindful that HMOs come with more overheads in the first place.
At Progressive Lets we specialise in HMO investments. Speak to one of our passionate property professionals about the range of benefits HMOs can offer today.
Being hotly tipped as ‘the new buy to let’, serviced accommodation typically consists of high quality, individual units that come with fully equipped kitchens, well-appointed living areas and somewhere comfortable to sleep for one person or more. They offer hotel-like benefits, such as fresh linen and towels, washing facilities, cleaning service and in some cases access to pools and gyms, but are much more flexible than hotels.
Business and leisure travellers will both benefit from using serviced units and demand for this type of accommodation is growing at a fast rate.
An increasing number of property investors are turning to commercial property as a way to diversify their portfolios. One of the main attractions is the secure income stream that comes from having high-quality tenants on long leases.
In addition, commercial property tenants are usually responsible for the vast majority of expenses such as repairs and insurances - this means much less day to day hassle for the landlord!
Investing in and managing commercial properties is completely different to residential properties and requires a degree of specialist knowledge. However, more and more investors will be taking the plunge this year, and reaping the rewards as a result.
Talk to the Experts
It’s unlikely you’d attempt to invest in art or antiques without first consulting experienced specialists who would be able to give you’re their expert opinion. Yet, we’re always amazed at the number of people who invest in property without seeking the same kind of advice.
We pride ourselves on being the most personal property agent in the UK and would love to chat to you about your portfolio and future property investments, and help you with your diversification plans to protect and maximise your investments.
Call: 01733 293900
Or catch us on socials.