Owning a property or multiple properties is a popular way to invest for the future. Not only is it likely to make a profit if you choose wisely and then sell, but it can also provide you with a steady rental income throughout the ownership of the property. So how exactly do you future-proof your property investments?
Before purchasing a property there are many factors that you need to consider. Location, demand and use are three of those.
The location of the property will likely determine the demand and the use. If your property is set in an idyllic rural location it may be perfect for a short term holiday let. If the property is mid-terrace in a busy town, it could work well for a busy professional for long term living.
The use, again, is going to go hand in hand with the location. Travel restrictions to go abroad were introduced during the uncertainty of COVID 19. This meant many people turned to the ‘Staycation’ option for their holidays. As the virus seems to be here to stay, and with many not looking to travel for their holidays, this could be an option for your property. Knowing where your property is situated, and tailoring to the demand can help to secure your future investment.
Demand is something that could change over time but you can start by looking at the rental market in the area you’re looking to buy. Research online, looking at the area and what the community needs. By looking at the needs you’ll get a better idea of where the demand is. Higher demand will almost certainly guarantee you tenancy from the get-go.
At the moment there is a high demand for rental properties with outdoor space. This trend is likely to continue during the ongoing pandemic, as more and more people are working from home long- term, and therefore placing a higher value on their space.
Another thing to consider when looking to invest in property is the length of time you offer tenancy. Contracts can range from short term (like holiday lets) to long term (a permanent tenant). Whilst most landlords offer an initial contract of between 6-12 months, there are a rising number offering long term tenancies. This helps people looking for longer-term lets to feel secure and make your property their home.
If you already own a property, consider looking at the facilities you offer. One survey suggested that 24% of tenants would be happy to pay a higher rent if they were provided with better kitchen facilities. A further 20% of people said the same but for a new bathroom.
Giving your rental property a bit of TLC and concentrating on the rooms that are central to modern life, can help you to achieve a higher monthly yield. This can often benefit you in the long run too. Other considerations might be adding a utility space, or even more popular a home office. Any of these ideas could see you achieving a higher rental price, as well as being more likely to achieve a higher price when you eventually look to sell.
To summarise, our top tips for future-proofing your property investment are:
- Taking time to purchase – make sure you get the right kind of property for your area and demand.
- Think about use – is a short term holiday let going to be a better option?
- Invest more to get more – Keeping facilities up to date and fresh looking, will help you gain in the short and long term.