Reasons why you should invest in property
Six reasons why you should invest in property

Six Reasons Why You Should Invest in Property

There are many ways that you can invest money but here are six reasons why you should invest in property.

6 Reasons why you should invest in property

1. BE THE BOSS

You are in charge and can choose:

  • which properties you are going to invest in,
  • which tenant to rent to,
  • how much rent you want to charge and
  • how the property is managed.

You can also choose how how hands-on or hands-off you want to be. Some investors choose to be very hands-on and manage their portfolio themselves while many others have full-time jobs and trust investment companies to manage their investment from sourcing the right property to finding the right tenants and supervising ongoing maintenance and repairs.

2. LEVERAGE

Investing in property means that you can secure leverage, a loan or mortgage in order to maximise your own investment. You are unlikely to be able to secure a loan from a bank in order to increase the amount of money you have to invest in shares.

3. INCOME

The return you receive from property investment is split into capital appreciation and cash flow.

Capital appreciation is the increase in value of the property itself and cash flow is the profit you make each month from rent. If you are investing wisely, as well as improving the value of the property over time, you should also receive a positive monthly income. Even taking into account void periods, this income is steadier than other forms of investment.

4. INSTANT GAIN ON YOUR INVESTMENT

If you purchase property at below the market value you can, in many cases, instantly add equity to your investment simply by buying cheap.

5. INCREASING VALUE

Unlike other investment vehicles, by investing money into your property you can increase the value of the investment significantly. If you’re creative and spend wisely you could add considerably more than you spend.

6. INFLATION

Investing in property is a way of hedging against inflation. With high inflation, your rental income and property value would increase significantly. As the cost of living goes up, so will your cash flow.