Other investments are no competition against property investments as property is the only asset class that produces two different types of return; capital appreciation and rental yields. Property provides complete control, but only if you want it to. If you chose to invest in property you have the choice of management, and choice is something rarely provided in other assets like stocks and shares which is why proves such a popular option.
Rental income pays better dividends, if you assess the potential income from a property investment it accelerates far past those achieved from stocks and shares, and government bonds or cash accounts. Often, cash in the bank can incur a loss after losing out to inflation, which is how property can often be portrayed as a much more reasonable choice.
You have full autonomy on setting rent on your property, if it is in line with the market and in the right location, your property is predicted to prosper. In Britain, the best buy to let area is in Liverpool with the highest rental yield situated in the L7 postcode at 11.79%, whereas the current highest paying dividend stocks offer yields starting from around 4% and has remained well below this figure for most of the last 25 years.
There is always a demand for property leading to an undersupply all around the world, but the UK has become particularly affected. However, even when the market is in a state of crisis or suffering a period of instability, the property market always remains resilient and in comparison, the stock market produces fantastic opportunity for capital gains. Choosing to invest in stocks can leave you suffering capital loss, losing all the money you’ve invested in an unpredictable market.
Another compelling point drawing people to the property market is investing in something tangible. Stocks, are essentially in the same vein as cryptocurrencies like Bitcoin, that are ethereal assets that lack definite dimensions. When a shareholder dies the right to their interest in the shares will pass to whoever inherits them in the will, but this is only earning value in one form – unrealised gains, as the gain can only obtained when the stock has sold. Property investment however is still gaining capital appreciation, on top of the great rental yields that are achievable and obtainable.
RW Invest, property specialists based in Liverpool, offer a range of buy to let opportunities across the UK that focus on maximising capital appreciation in areas with excellent rental yields. Click here to view a full range of their diverse portfolio: https://www.rw-invest.com/uk-property-investments/.
When investing in property there is a term called gearing, which simply boils down to borrowing money to invest, which has hugely magnified total returns. In theory, the engine power is the same, but when you move up a gear, it must work hard to move the car faster. Let’s look at this closer, if you are investing in the stock market with £20,000, and the market rises by 10% you make £2,000. Whereas, if you use to same £20,000 as a deposit and borrow £80,000 to buy a £100,000 property and the property rises by 10% you end up making £10,000, equivalent to a 50% return. Highlighting property investment as a robust asset class of unparalleled potential.