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    1. Off-Plan or Completed Properties?

    Off-plan properties are simply properties not built yet, whereas completed properties are developments that are either pre-existing or have recently finished construction. There are many benefits of off-plan and completed properties, which all depend on the investor’s preferences.

    The further off-plan properties are from finishing, the lower the potential purchase price. These developments can offer prices 10-15% below market value and generate immediate equity for the investor upon completion. Because of this, off-plan properties have the potential to be high-yielding investments.

    While off-plan opportunities are great property investment strategies for further down the line, properties already built can be more fast-paced and immediate. Investors, for example, can immediately generate rental income if the property is already tenanted. Many BMV properties offer prices far below market value and can be more beneficial to cash buyers, as sellers desire a quicker sale.

    2. Mortgage or Cash?

    Following the fluctuating house prices, rising mortgage rates, and affordability pressures of 2023’s property market, contemplating how to purchase property quickly turned from 100% mortgages to buying upfront.

    Buy-to-let properties come with a 25% deposit, which, if house prices this year continue to fall, becomes more affordable for investors. However, with the current base rate, monthly mortgage payments are more of a concern for buyers. Rising rents counteract this, though, and can offer great ROI in reflection. Investors must consider all options and lenders to find the most profitable option for their circumstances. You can download our BTL Mortgage Guide to learn more.

    If investors have enough capital to buy the property upfront, it is recommended to do so. Cash buying can be a quicker process to securing a property, without needing to wait for mortgage applications, and avoids interest payments. This is a great way to purchase a smaller property or secure further funds towards a bigger portfolio, using the likes of BMV opportunities or bridging loans. Cash buyers are even predicted to make up 40% of property sales this year.

    3. AST or STL?

    Following the rise of short-term rentals from the pandemic, more and more landlords have been considering an assured shorthold tenancy (AST) or short-term let (STL).

    Short-term rentals, like holiday homes, can be more flexible and straightforward for landlords. They are fantastic options for tourist areas and seasons but are also beneficial in areas close to the likes of airports, hospitals, and popular amenities.

    While short-term lets require higher levels of costs and maintenance, they can often offer higher income than traditional buy-to-lets. However, they are seen to be riskier due to potential void periods between new tenants. Because of this, landlords and investors still opt for assured shorthold tenancies.

    Traditional long-term buy-to-lets are safer, more secure investments. Less management is needed and furnishing the property is not necessary. With longer contracts, investors can even retain tenants by improving the energy efficiency of the property, which also increases its value. What is more, single lets (one-bedroom properties) cost less, see higher demand, and are the most profitable.

    4. North or South?

    While London is a clear front-runner for population and tourist numbers, and demand to match it, it however holds the current lowest rental yield in the country: 4.92%. Its affordability pressures are the highest in the UK.

    The fluctuating house price growth in 2023 defined the ever-widening North-South Divide. The average tenant in London tenant spends 40.2% of their income on rent, which is an average of £2,627 PCM (Rightmove). This is compared to the UK average of 28.4%. Despite this vast difference, renting is remarkably cheaper in London than monthly mortgage repayments there. The complete opposite is found in the North, which is the main reason why prospective tenants, homeowners, and businesses are moving North.

    Some of the best areas to invest this year are in the Northern Powerhouse due to its affordability and growing desirability. Because of this, the North is home to the best rental yields in the UK.

    The Best Property Investment Strategies

    CityRise Verdict

    As we head into the 2024 property market, knowing the best way to approach your property investment strategies is paramount. Investors should consider the points discussed above and decide the best route to reflect their preferences and circumstances.

    Using an investment agency like CityRise can be the best form of guidance through your investment journey, whether it is your first or third property.

    Schedule a call with our Investment Consultants to discuss your first step this year!

    Useful links:

    Your Guide to Investing Off-Plan

    BTL Mortgage Guide

    Top 5 Investment Hotspots

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