7 Things Every Property Investor Should Know

Historically, property as an investment has outstripped all other forms of investment, mainly because an investor feels they have more control over it. The property market in the UK will continue to grow for reasons like; demand is currently higher than supply; the UK is experiencing high birth rates and divorce rates, immigration numbers and property investment is now seen as a good alternative to a pension.

TV shows and the general publicity around property development has depicted the industry as an easy way to make money but if you enter the industry blind sighted then this most certainly isn't the case. Before jumping in with both feet, it's essential that property entrepreneurs do their research and don't just rely on what agents and sellers say - remember it's their job to sell!

Currently property hotspots in the UK include Hull, Ramsgate, Bradford and Brighton. According to Halifax Bank, Brighton is the city that has shown the strongest house price growth per square metre over the last ten years, some 280% increase. This is mainly due to its large student population and its appeal to the young professional - it is within commuting distance of London and its location is near the sea.

The property industry is a difficult one to crack so here are my top tips for getting started:

ONE:
Don't get drawn in by marketing hype, carry out all research yourself on the property, the area, the rental market and resale values. The internet is a valuable research tool to find information on local areas and property price trends.

TWO:
Always set out your property investment goals at the beginning, that way you can plan on how you're going to achieve them.

THREE:
Never get emotionally involved in a property, always remember you're investing to make money and not to live in the property yourself. Keep the decor neutral, keep the carpets dark - they will last longer and just because you would not want to live there, it doesn't mean others wouldn't.

FOUR:
Always look for a positive monthly cash flow as well as capital growth. Capital doesn't always happen overnight. Speak to local agents, especially letting agents and find out how much rent they can achieve and demand for this kind of property. Find out from the agents what types of tenants it will attract, and then ask you does this make a sound investment. Make sure you are aware of the letting laws/regulations in the area, ie. does the property need to have work done to it to meet regulations such as licensing, as this can be costly.

FIVE:
Never overstretch yourself and allow a contingency budget for unforeseen costs such as maintenance, void periods and most importantly interest rate changes.

SIX:
Transport links are very important, people will always need to travel and as house prices are on the increase people will look to commute and therefore transport is key. Look for bus stops, motorway links and train links.

SEVEN:
Good local amenities such as shops and schools are important, as the opportunity to nip to the local shops or be within a short distance of your local school for your child can be very important and people are attracted to these areas more than remote locations. Not everyone has cars and therefore the closer they are the better.

If wannabe developers follow these simple rules then the property industry can provide a lucrative return on investment.

To find out more about Property Investment visit www.propertyinvestmentportfolio.com