IS IT STILL THE RIGHT TIME TO INVEST IN PROPERTY?
As the expense of living continues to grow, the term “inflation” is all across the news headlines. The year-on-year estimate of inflation climbed by as much as 5.5 percent in January, bringing it to its highest level in more than three decades.
Landlords are not exempt from inflationary worries, surveys show that rising property prices are simply increasing the attraction of real estate as an investment.
A recent survey was conducted on hundreds of property investors, the results of which were published recently.
It explored their feelings on the present high inflationary circumstances and how they thought it would affect their personal property holdings.
The findings are shared below.
The fear or growing concern that rising inflation would have a negative impact on the ability to continue to invest effectively in the rental market was voiced by more than four out of every five respondents (83 percent).
Rising energy bills, which have been an increasing source of concern for UK homeowners, as well as rising mortgage prices, were two particular sources of concern for respondents.
However, it was shown that these worries had only a little influence on the future intentions of landlords and investors in relation to their portfolios.
While inflation was at an all-time high, less than one-third (29 percent) of landlords intended to scale down their operations during this period.
On the contrary, more than a quarter of respondents said that they planned to expand their investing activities in the future.
Approximately one-third of those surveyed said that they would neither raise nor reduce their investing activity going forward. By itself, this demonstrates how many people are optimistic about the long-term prospects of their holdings.
The above statistics suggest a sense of security within the lettings industry.
Property will remain an attractive investment option until investors discover a superior inflation-eating return from another asset, which is unlikely.
This is because the housing market is incredibly robust and is set to remain strong over the course of 2022.
With the continuing shortage of property within the UK, landlords who invest in popular regions will have access to an abundance of options for tenancy.
As a result of shorter void periods and greater rental revenue, this will be music to the ears of many property investors.
In fact, according to a prominent property expert, the typical estate agency branch today has access to over 100 prospective purchasers on their books, despite the fact that there are only around 19 houses available for sale.
This strong demand is reflected in the lettings market, where rental values have risen by an average of 10% in comparison to the same period the previous year.
According to industry experts, this will assist to alleviate some of the pressure on landlords who are experiencing rising maintenance expenditures.
However, although we believe that the most landlords would not raise their rates every time they have the opportunity, there are methods in which we can assist landlords in taking advantage of the present market circumstances.
Many of our investors seldom take a short-term perspective on fluctuations in profitability in the real estate investment industry.
If you are experiencing some concerns, we hope that the information provided above has helped you to concentrate on the long-term possibilities for the present economic circumstances.
Overall, property continues to be one of the most successful investments available.
If you are trying to maximise your profits and expand your portfolio under the present market circumstances, please contact us.