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Month: June 2019

Building Your Property Investment Portfolio

Building your property investment portfolio can be a daunting task. There are a lot of horror stories out there about people who have ended up in debt instead of getting the returns they wanted. If you are unsure about how to start building your portfolio, there are a few steps that you should take.

Identify Your Goals

Having a plan is important and the best way to start creating your plan is to know what your goals are. There are different types of property that you can look at based on the goals that you have. Investors looking for capital appreciation will need to look at different properties to someone wanting rental income. Of course, it is possible to want a combination of the two.

Your goals will help you choose the first property that you buy. It will also create a roadmap for the rest of your portfolio. After all, you are not going to buy a property that does not help you achieve your goals.

Start Small

A lot of people make the mistake of thinking that they should get as many properties into their portfolio as they can as quickly as possible. Unless you have endless funding, this is likely to be unsustainable and could cause serious issues. It is better to start small and work your way up to a full portfolio.

Buying one property that helps you meet your goals is the first step. Once you are comfortable with this property and have the funding to buy another, you can start looking again. It is important that you go at a pace that suits you because everyone has different investment speeds.

Keep An Eye On Your Cashflow

Having a property portfolio that puts you into a negative cash flow will not be an investment and you need to keep an eye on this. It is very easy for the figures to get away from you if you are not careful. This is why you need to take the time to create metrics for your financials and review them regularly.

One of the key metrics is ensuring that the income you get from the properties covers your mortgage expenses. Of course, as an investor, you will want the property to provide you profit over and above this. If something is not working financially, you need to consider why and what can be done about this.

Do Not Forget Your Tenants

When you are growing your portfolio it is possible to forget about your tenants and what they need. While you are checking your portfolio and looking for the next property, you need to ensure that your current tenants are happy. The success of your investment will rest on this because you do not want your property sitting empty.

A property investment portfolio can be a great idea, but you need to start it correctly. Taking your time to map out your goals and your metrics is important. You also need to keep a close eye on your cashflows to ensure that everything is running smoothly.

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UK Property Investment For Newbies

The Newbie’s Introduction To Property Investing

Property investment in the UK can be a surprisingly complex and rewarding experience. There are a number of ways that a newbie might get involved with property investment. They can be separated into two primary categories. The first is residential property investment and the second is commercial property investment. Both of them have their strengths and weaknesses. A potential third option is to invest in stocks and funds, such as Real Estate Investment Trusts.

Residential Property Investment

The most common form of residential property investment is known as buy-to-let. This is where you purchase a residential property and then rent that property to tenants. Buy-to-let investing is generally considered a safe investment. Property values will undoubtedly fluctuate over the years, but property as a whole is still a smart investment in the long term. And make no mistake about it, buy-to-let is an investment opportunity with long-term rewards.

A successful buy-to-let investment requires renting out a property for the perfect amount. The income needs to be enough to cover the mortgage and fees associated with the property as well as provide some profit. Most properties will reach this point in time, but your goal should be to achieve this milestone as soon as possible. That requires finding the best possible homes for the best possible deals. No easy task.

Commercial Property Investment

Commercial investing essentially takes the game to the next level. The capital required is larger, the risk is larger, and the rewards are larger. The good news is that any property can be considered a good investment after enough time has passed. That applies to residential as well as commercial property. Of course, that doesn’t mean you should throw your money at the first opportunity that comes your way.

Successful property investment, especially when it involves expensive commercial properties, is best done with the advice of a professional. Working with accountants, real estate agents, and investors who have experience in the market can make all of the difference. That’s what will take you from newbie-status to successful investor.

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