If you’re thinking of making your first property investment, now is the perfect time to get on board. Throughout the last few years, the buy to let market has had increasing levels of interest due to growing populations in a number of UK cities, high demand, affordable opportunities, and impressive rental yield rates. Before making that first step, take a look at these tips on some of the things you should consider before you make your first property investment.
The location you choose for your investment is a major factor, so make sure to do your research before making any big decisions. In recent years, there’s been a big shift location-wise when it comes to buy-to-let investments, moving away from London and looking towards the North. Cities like Liverpool and Manchester have seen high levels of buzz around the property, gaining a name for themselves as some of the UK’s property investment hotspots.
There are a number of factors that make Liverpool and Manchester fantastic options for your first property investment. A growing population in both cities means demand for high-quality property is higher than ever. More people are moving to cities like Manchester, taking advantage of the wide range of business opportunities, rich culture, and fantastic quality of life, along with more affordable prices compared to London.
New developments are underway under the Northern Powerhouse initiative which will see interest in Liverpool and Manchester grow even further. Major regeneration projects include Liverpool Waters, a £5.5 billion development that will transform the Liverpool waterfront and create housing, investment opportunities, workplaces and more. Other developments include the UK’s first-ever sub-national transport body, Transport For The North. This project aims to improve transport between Northern cities and offer increased frequency and higher capacity for the North’s rail networks. It is developments like these that ensure Liverpool and Manchester will provide plenty of opportunity for capital growth, both now and in years to come.
Whether you’re an experienced investor or this is your first venture, the cost of the property you’re choosing to invest in is always a factor to consider. For the first time buy to let investors, it’s important to go for a property with a good price and high rental yields. Northern cities like Liverpool and Manchester are known for their impressive prices and rental returns, with property investment companies like RW Invest offering the lowest priced property investment in the UK based in Liverpool, with prices from £45,450 with an 8% net rental return. The cost and location of your property investment have a big correlation, with average house prices in London standing at around £671.412, whilst Liverpool house prices have an average of just £158,299. There are also other costs that you have to take into account like maintenance and potentially the cost of property guardians to look after your property.
The Target Market
The type of property you choose to invest in is a deciding factor in the type of person you’ll attract as a tenant. Before making your first investment, you need to think about who you’d like your target market to be. Investing in properties such as residential apartments or houses means you’re likely to attract families or young professionals — the latter particularly if your property is based in a prime city center location.
The student property market is another great option to consider, especially for first-time investors. Demand for student property is growing year on year, thanks to a big student population throughout the UK. Purpose-built student accommodation is a particularly popular market right now, growing from £4.5 billion in 2016 to £5.3 billion by 2017. This type of student accommodation caters to the changing attitudes of students who will no longer settle for the underwhelming university halls of the past, providing students with a more high-quality, luxury style of accommodation.