Why residential property investment is a good bet for 2022
Despite economic challenges like Brexit and the COVID-19 pandemic, the UK property market is still an enticing option for new and seasoned investors. According to some real estate statistics, the market increased during the pandemic and is worth around £68.6 billion.
People are clearly very cautious about their investments due to the rising cost of living. Still, that doesn’t make real estate investments any less viable or attractive to retail and hedge fund investors.
Still, why exactly is 2022 a good year to get on the property investment ladder? The following explains more:
Soaring house prices
The first point to consider is how house prices continue to climb and have done so for several years. Even during economic strife, where house prices have plateaued or dipped, they continued to grow.
The average house price in the UK is currently around £273k as of January 2022, up from around £215k just five years ago. That equates to an increase of £58k or £11.6k per year.
Another reason to invest in residential property is how the UK’s population is continually rising. Latest estimates from the Office for National Statistics show that the population is at 67 million people – up from 65 million in 2015.
It comes as no surprise that an increasing population directly correlates to an increased need for housing, especially rental properties, as new families form and children become adults and wish to move out of home.
Ease of property management
There’s no denying that managing multiple properties in a portfolio can be challenging for most people. Dealing with maintenance issues, new tenants or buyers, and legal contracts are just some things that make managing property portfolios a full-time job in itself.
Thankfully, residential property management companies and technology aid portfolio owners in managing their properties and have a more streamlined approach. There’s now no reason to avoid having two or more properties as part of any investment portfolio.
Thriving rental markets
Due to factors like a rising population, demand for rental housing is soaring each year.
A recent report commissioned by the National Residential Landlords Association states that the supply of homes for the rental market must increase because of the growth of owner-occupied and socially-rented properties.
The report suggests that the North West, Yorkshire, and West Midlands regions are particularly affected by the shortage of rental properties.
A tried and tested investment option
Property investments, whether they are to buy and sell for profit or to keep for rental income, are not new ideas. It’s something that people worldwide have been doing since records began.
Investing in bricks and mortar is a more cautious yet tried and tested way of growing money compared with risky ventures like cryptocurrency or peer-to-peer lending.
Whether property values remain the same or dip slightly, the truth is that house prices always increase over time. Property investments are excellent ideas for people looking to raise their net worth using a tried and tested method.