Of course, the main factor that suggests you’re ready to make any type of investment is your financial status. You need to be able to afford the property investment, plus any extra costs involved, so be sure to work out whether you’re on the right track financially.
Know Your Long Term Goals
If you’ve recently started a new, higher-paying job, received money from an inheritance or got a promotion and a pay rise in your current role, these could be signs that you’re ready to take the jump. Rather than splurging on items like a new car or a holiday, you could put the extra cash you’ve acquired go towards investing in your financial future.
Another way to decide if property investment is right for you is to look at your long term financial goals. If you have specific financial goals that you hope to achieve, such as saving up enough money for early retirement or saving money towards your children’s education, property investment provides an effective way to achieve these goals.
Location, Location, Location
The type of properties that offer the most financial potential is largely dependent on the location you choose for your investment, so it’s important to do your research. Liverpool and Manchester are moving up the ranks as the UK’s best property investment hotspots. Not only are these cities experiencing major economic growth which can generate strong capital appreciation, they also boast some of the UK’s highest rental yields. Some postcodes in Liverpool have yields that average a huge 11.79%, and both cities have average rental yields that far outrank that of London. The fact that these northern cities are so affordable plays a big part in the high rental returns on offer. The average price to buy property in Liverpool, for instance, is £130,677. When compared to London’s average property price of £484,173, it’s easy to see why it’s so important to research different cities and find out where you can afford the most.
Knowledge Is Power
If you feel financially stable, you’ve done your research, and you feel knowledgeable enough on how to achieve your goals, you should think about what happens after making your investment. If you’re investing in property to become a buy to let landlord, you need to be aware of the responsibilities involved. Finding the right tenants can be difficult, as you want to rent your property to someone who’s trustworthy and reliable, but many landlords use a property management company for this. Then, once you find the ideal tenant, you’ll need to respond to any queries and handle maintenance issues promptly to keep the tenant happy. Before making your buy to let investment, think about whether you’re prepared for these responsibilities. If not, it might be worth considering alternative investment routes, or simply wait until you feel ready.