Property Investment

Name: Property Investment
Rating: 4.8

Expert property investment solutions for investors and developers.

Investment Property Partners is a leading independent property investment specialist serving clients throughout the UK and internationally. Our experienced property teams focus on delivering exciting investment opportunities that encompass most property asset types including commercial property, buy to let, buy to sell, sale and lease back, overseas property and development land.

Every property investment acquisition or disposal is unique and by drawing upon a wealth of experience found in each of our property disciplines we are able to provide innovative and tailored real estate solutions to enhance our clients’ investment goals and objectives.

Investing in Property

The process of investing, including property investment could in simple terms describe the process of purchasing or putting money into an asset with the expectation that it will gain in value at some point in the future to return a profit when that asset is eventually sold.

There are a diverse range of investments to choose from, such as stocks and shares, gold, fine wines, stamps, antiques, works of art, jewellery, classic cars, and property… to name but a few.

Your attitude to risk, access to finance, experience and personal preferences are just some of the factors that will dictate what investment vehicles you decide to select.

Long Term Value of Property

Property has historically proved to be a good investment for many.

Throughout history property has provided astute investors with handsome returns, with many of the World’s wealthiest people having made their fortunes in property.

Although the past few years have shown a decline in property values, the underlying historic trends would suggest that this is a temporary blip, and that the long term trend is for rising property values.

Property does not go out of fashion, unlike fine wines or antiques, and there is a rising demand for it driven by scarcity, whether as homes for people to live in or as commercial property to support industry and commerce.

Property is solid and substantial, and less subject to rapid market fluctuations such as the stock market, where a crash can seriously impact or even wipe out the value of an investment.

Property values do fluctuate however, but the value of the land on which it is built is a tangible asset.

Advantages of Property Investment

Property investment has several advantages over other types of investment opportunity;

Asset Security
Property, be it commercial, residential or overseas is a tangible asset that is unlikely to lose all its value in a recession or stock market crash and so provides investors with a form of asset security.
Property Finance
Finance to purchase property can be available at lower interest rates, spread over a long term in the form of a residential or commercial mortgage. However, an initial cash deposit will usually be required by the lender.
Financial leverage
The important principle of financial “leverage” can be applied to purchasing property. This means that once you have purchased one property, you can borrow money against the asset value to obtain a mortgage for another property, until a number of properties are acquired. This principle is often referred to as “buying property with other people’s money” and can be a very useful technique. A large number of ordinary people have used the principle of leverage extensively to create substantial property portfolios.
Knowledge
Many people already understand the basics of buying, renting, and selling property from their personal experiences in acquiring their own home.
Demand
In the UK there is a large, well established buy-to-let market, in which properties are bought to let to tenants (students, young professionals etc.) where there is good demand in large cities, university towns etc. Specialist mortgages are available for residential buy-to-let properties, and the intention is that the rents received pay for the mortgage and any running costs, with a surplus for profit. If the property increases in value over time (capital growth) they can then be sold at some point in the future for a profit.
Tangible Asset
Property is a tangible, bricks-and-mortar asset, and is versatile in that you can rent it, live in it, renovate it or redevelop it.
Design
A property can be customised to your own requirements. You can have the pleasure of seeing a property go from run-of-the-mill to an object of beauty.
Tax Efficient
A residential property can be used as your own home until you sell it, this is a useful approach as it helps to minimise capital gains tax bills, which with property can sometimes be considerable.
Holiday home
If located in a good, sought-after area, you can use your investment property as a holiday home for part of the year, and rent it out in the times you don’t use it.

Disadvantages of Property Investment

Property investment is not all about the up-side, there are also a number disadvantages that the prudent property investor should clearly understand;

Significant Deposit
Investing in property often requires the investor to deposit a considerable sum of money, as property finance is unlikely to be available for 100% of the acquisition.
illiquid asset
The money invested in property may not be easy to access if you need to release your cash quickly, as property sales can often take some time to complete. Property is sometimes referred to as an “illiquid asset” and should be seen as a medium to longer term investment proposition.
Complexity
Buying and selling property can be a complicated process, involving several different stages and additional costs. These can include a range of professional fees, selecting the most suitable forms of property finance, and the use of lawyers and various agents, engineers and surveyors.
Property Tax
When a property is sold, capital gains tax becomes payable on the profit element, that is unless you can demonstrate that the property was your primary residence. Property tax is a complex area and we recommend you consult with a suitably experienced accountant or specialist property tax advisor.
Proactive Management
Property is an asset that requires proactive management to safeguard its value and income streams. Regular tenant management, building maintenance and updating is required to minimise rental voids and prevent the building fabric from deteriorating.
Leasehold
When buying leasehold properties, as opposed to freehold, it is important to remember that you are not buying the property itself but are only leasing it for a specified number of years. When the lease expires, the property reverts to the leaseholder. However, many leases are for a considerable period of years and there is little difference from buying a freehold property. Most apartments are sold leasehold.

Managing your Property Risks

On balance, many people decide that property is superior to many other forms of investment, mainly because it is a tangible “bricks-and-mortar” asset, it is subject to fewer market fluctuations, and most people have some experience of it.

However, any investment involves risk, and it is important to understand that property values can go up as well as down.

It is also well to remember that understanding and managing your risks, and getting good professional advice will have a significant impact on your prospects for success as a property investor.

The more knowledge and experience of property dealings and investments you have acquired, the more manageable your risks are likely to be.

Our Property Investment Capabilities

Our property investment capabilities encompasses the following classes of property:

Commercial Property

This hands-on property investment training course examines aspects around property valuation and investment performance.

It reviews various valuation tools and techniques including discounted cash flow (DCF) and net present value (NPV), the identification and management of project finance and expenditure; it reviews common property valuation techniques, investment performance evaluation; and concludes with a review of opportunities for property investors in overseas property and emerging markets.

Commercial property →

Buy to Let Property

This popular property training course reviews the main principles of property law and legal matters affecting property transactions.

The course also examines the main types of property finance and sources of funding used by investors and property developers. It also looks at a number of useful financial modelling techniques used by investors and developers; and concludes with a comparison of buy-to-let, buy-to-sell and property development strategies.

Buy to Let Property →

Overseas Property

This popular property training course reviews the main principles of property law and legal matters affecting property transactions.

Overseas property →

Student Property

This advanced property investment training course examines issues around property ownership, investment risk management and asset diversification.

This training course explores the important aspects of direct and indirect property ownership models and what this means to an investor, it examines the process of securitisation of real property assets, property derivatives and the opportunities they present for investors.

The course concludes with an in-depth review of investment risk management and the application of portfolio theory and asset diversification in a property context.

Student property →

Holiday Homes

This advanced property investment training course examines issues around property ownership, investment risk management and asset diversification.

The course concludes with an in-depth review of investment risk management and the application of portfolio theory and asset diversification in a property context.

Holiday homes →

Development Land

This advanced property investment training course examines issues around property ownership, investment risk management and asset diversification.

The course concludes with an in-depth review of investment risk management and the application of portfolio theory and asset diversification in a property context.

Development land →

Expert Property Investment Solutions

As leading independent property investment specialists Investment Property Partners offer expert advice and support to clients across our specialist areas of expertise helping them to achieve their investment objectives.

If you are a property investor or property owner seeking to acquire or dispose of property assets, or enhance the value of your existing property portfolio contact our property investment team today to discuss how Investment Property Partners can help you.