Why property investment?

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Property investment is so lucrative due to the number of ways it creates wealth and allows investors to use their capital. 

1.  Rental returns alone are as high as returns from major index funds
2. Property prices double again and again over lifetimes
3. Unlike other investments, banks lend on property, meaning investors can leverage their money
4. Unlike other investments, property assets can be bought below market value & the price can be forced upwards from renovations

You can expect rental returns on money invested into a buy-to-let of 7-10%, similar to the rate of returns expect from an index fund. We only pass on deals with estimated minimum rental returns of 7%. Returns of 10% can be achieved in certain areas of the country such as Liverpool, our 2023 investment hotspot. 

Even higher returns can be achieved on more creative strategies such as buy-refurbish-refinance. This involves buying a property below market value, with room to add more value through renovations, before pulling most or all of your cash out of the investment after refinancing at a higher price.

People in property have relentlessly heard the claim 'House prices double every 10 years'. But is this really true? Well, the real answer is captivating - on average property prices have doubled every 8.5 years since 1952, according to data from Nationwide. 

It demonstrates asset appreciation is a hugely powerful force for wealth creation, which on top of rental income, puts property at the top of a lot investors' list of favoured asset classes.

However, growth is not always linear. Remarkably, the quickest period of time it took for UK property prices to double was 3 years (between 1971-1974) and the longest was 14.25 years (from 1989 Q2 to 2003).

Banks lend money for you to buy property through a mortgage. This allows you to take control of an asset worth far more than the money you are putting down.

This allows you to leverage your money and make greater returns through more sources of cashflow and long term asset growth. 

Say you have £100,000 to invest, instead of buying one terraced house, you can buy four, by putting down four deposits of £25,000.

If house prices were to double in a ten year period, you would then have a property portfolio worth £800,000, rather than one home worth £200,000. 

We find property deals off-market, negotiated a great price. Buying below market value means you are adding instant equity at the point of purchase. 

What's more, is that you can add value to the property price through refurbishments. The ability to force the value of your asset up is a unique and exciting feature of property investment.

Finally, you are then in a position to pull out most, or sometimes all of the money you put in the deal through a refinance. Or simply sell the property for a profit (commonly called a flip).