Property Investment Advice - Avoiding investment mistakes
Published on 25th April 2008 by Andrew Ward
Looking at investment property decisions in the same light as your home can lead to some potentially disastrous mistakes. The things we take into consideration when buying our home are not the same as the practical financial calculations we use to assess investment property.
Sound property investment decisions ALWAYS come from the head and not the heart.
Property - Prices may fall
As shown earlier, the worst the market got was in 1992 when the property prices saw less than a 4% reduction in one year and the average was still able to double every 8.2 years in the long term. Because Ward & Co provides, genuinely discounted property, the short term market fluctuations can be absorbed. Therefore, property investment is a medium to long term process and should always be looked at that way.
Long term housing market growth is steady, short term fluctuations can be absorbed due to genuine discounts.
Demand - Will it continue to outstrip supply?
It is easy to feel that the past will not be repeated in the future and that what has been profitable for others will somehow change because we have decided to try it. It is essential therefore to look at statistical evidence to confirm future housing needs. In order to view the decision to enter the property investment market in a rational context, we draw your attention to the following information from the Office of the Deputy Prime Minister and the building industry:
ODPM says that we need 2,000,000 new homes over the next 5 years. That is a demand for 400,000 new houses every year, but we only build around 200,000 new properties per year.
We cannot keep up with the demand for housing!
Rental voids - What if I can't get a tenant
Many new landlords wonder if there will be enough tenants out there to rent their property. The Office of the Deputy Prime Minister tells us that :
"About one in 10 households in England rent their accommodation from a private landlord……… . accounting for about 2 million households."
We will not run out of tenants!
Rental voids are the greatest fear when starting out as a landlord; losing a tenant unexpectedly, especially if they leave without paying, can seriously affect cash flow. Not being able to get a tenant means loss of income and a stretch to cover mortgage repayments. We can help you to put insurance in place to avoid the effects of these void periods.
Ward & Co Property Investments can help to reduce risk.
Andrew Ward
Set up Ward & Co so that ordinary people could secure their financial futures through Property Investment. Pensions, ISA's, endowments, stock & shares have failed to deliver this and yet at the same time property in the UK and in some Overseas locations has continued to rise steadily.
